The Canadian economy is contending with a trifecta of issues: rising interest rates, rampant inflation, and sluggish growth. Despite the trilemma of challenges, commercial investment in the Edmonton real estate market has been strong – and the latest data suggest that it will not come to a screeching halt anytime soon.

In the first quarter of 2023, the Edmonton commercial real estate market recorded one of its strongest first quarters ever as it relates to investment activity. Recent statistics show that overall sales volume surged close to $800 million, driven by a 76-per-cent increase in industrial sales and a 45-per-cent boost in land sales on a year-over-year basis.

The commercial real estate market has seen diverse sectors experience tremendous growth, led by the industrial sector (distribution, logistics, and warehousing). Of course, other asset classes were up, too, such as retail, multi-family land, and office, albeit at a slower pace.

So, let’s look at some of the different commercial property categories to determine how well things are and where they are heading.


Work-from-home policies are expected to be the new normal moving forward. As a result, the province established the Investment and Growth Fund (IGF). This initiative aims to provide incentives, attracting businesses and investments from other regions seeking competitive land prices, lower development costs, and a well-educated, younger workforce. In addition, businesses pledging at least $10 million in capital investment will be extended a 12-per-cent provincial tax credit. As the population continues to climb, more growth is anticipated in Edmonton.


Retail in Edmonton’s surrounding areas continues to be robust and resilient, enjoying gains from population growth and higher disposable incomes across the province.

On the data front, Edmonton saw 26 sales in the first quarter, a 28 per cent increase from the same time a year ago, with most of the transactions concentrated in shopping centres and strip plazas. This might be surprising because of Nordstrom’s departure, but there has been notable interest in the space. In total, sales volumes more than doubled to above $106 million. The average price per square foot is between $28 and $38.

This will not be the end of the bull market either. Loblaw plans to invest $2 billion to launch or renovate 38 stores. At the same time, other retailers are in the market for locations with smaller footprints to bolster efficiency and optimize space throughout the city.

Office Space

The office sector has been bombarded with incentives amid a sharp slowdown in the first quarter. Here is a breakdown of the data: availability rates were roughly flat at 20.4 per cent, vacancy rates are incredibly high, and conversions from commercial to office spaces have been limited since core buildings are difficult to repurpose. Surprisingly, suburban office spaces have been relatively stable in this type of commercial real estate market.

“Vacancy rates remain high, even with the traffic the Ice District, a mixed-use sports and entertainment district surrounding Rogers Place and Ford Hall, that includes office, condominium, hotels, restaurants and retail brings to the core,” RE/MAX stated in a report. “Construction is underway on a 500,000-square-foot office tower in the city core, slated for completion in 2025, with Canadian Western Bank as its lead tenant. There has been a flight to quality, prompting landlords in B and C class buildings to enhance their lobbies, hallways, and retail space.”

Edmonton’s CRE Will Maintain Strength

Overall, Edmonton’s commercial property market is projected to add to its strong January-to-March numbers for the rest of the year amid moderating inflation and stabilizing construction costs. With supply failing to keep up with demand, commercial real estate will continue to be one of the best asset classes in the future, although office space is not expected to grow as much due to shifting market conditions.

Scott Hughes, an Edmonton-based broker and owner of RE/MAX Commercial Capital, told the Edmonton Journal that the pandemic-era financial constraints are poised to loosen, despite the Bank of Canada (BoC) raising interest rates.

“We’ve had really good momentum in the Edmonton investment market,” said Hughes. “That, for the most part, was led by a very strong industrial sector.”

With population growth, desirable land pricing, and minor development costs, Edmonton continues to attract investment and businesses from across the country. Ongoing construction projects, revitalization efforts, and incentives provided by the provincial government contribute to the city’s commercial growth. As the economy recovers from the COVID-19 public health crisis and work-from-home policies evolve, Edmonton’s commercial real estate market is expected to thrive in the coming years.