Winnipeg’s commercial market in 2026 has been marked by cautious optimism, with pent-up demand emerging as those who deferred decisions in 2025 have started to make their moves. While economic uncertainty and geopolitical concerns have remained top of mind with investors, overall activity has been slightly ahead of year-ago levels.
Industrial anchors Winnipeg’s commercial market activity
Industrial has continued to lead commercial activity by a wide margin, now that prior disruptions in the trucking industry have largely subsided. Although job shortages, international tariffs, and a freight-driven downturn posed challenges for Winnipeg’s industrial sector in 2025, the market proved resilient, supported by sustained demand for logistics and distribution space.
National market continues to evolve
REMAX Canada’s national 2026 Commercial Real Estate Report examined first-quarter activity across 12 major Canadian markets and found that the commercial property market has continued to evolve with improved absorption, particularly in the office sector, where return-to-office mandates are supporting increased leasing activity in premium space. Industrial demand has remained durable nationwide, with inventory challenges persisting. Retail fundamentals have continued to outperform expectations, supported by population growth and infrastructure investment, reinforcing long-term demand. While capital deployment has been measured in most markets analyzed, improving financial conditions have prompted renewed interest in well-located, income-producing assets.
Owner-occupiers accounted for nearly 50 per cent of industrial sales, followed closely by logistics and trade users. Industrial vacancy rates have held at approximately 3.5 per cent for nearly seven consecutive years. Inventory has remained at an all-time low, with limited land available for development within the city. Although industrial parks have been emerging on the city’s periphery, most sites are already developed, restricting tenant and buyer input.
Older industrial buildings are being repositioned, but not all industrial properties are well-suited for conversion. Building age, ceiling heights and structural limitations can make redevelopment cost-prohibitive, particularly when compared with newer, amenity-rich product offering better clear heights. Some vacancies have persisted in smaller industrial buildings with lower bay heights, where functional obsolescence has remained a constraint. Yet, demolition is generally not a preferred option, as well-located properties, particularly those near the city centre and airport, are earmarked for optimization.
REITs, institutional and private investors have been exceptionally active within the industrial asset class, heavily consolidating and optimizing industrial space in the city. PRO Real Estate Investment Trust (PROREIT) is one such investor. As the third-largest landlord in the city, its latest acquisition (an almost 25,000-sq.-ft. single-tenant, cross-dock facility in St. Boniface Industrial Park) brings the number of properties in its portfolio to 23, with a total of 1.3 million sq. ft. as of December 2025
Multi-residential demand in Winnipeg holds firm amid solid returns
Stable cash flow realized by the city’s multi-unit residential product has also attracted REITs, institutional and private investors looking to build their portfolios. Affordability, relatively low vacancy rates at 2.8 per cent according to Canada Mortgage and Housing Corp. (CMHC) data as of mid-2025, and a steady demand for rental units provide an ideal entry point. Purpose-built rentals have continued to come on stream in the city, with most financing provided by the CMHC MLI Select program. In addition to favourable terms, the program allows for a flexible timeline to complete occupancy if the rental is not fully leased upon completion. Potential amendments to Winnipeg’s rent control guidelines point to new inventory coming from buildings being repositioned or new construction. Properties ripe for rehabilitation should trade at higher cap rates if the guideline amendments are passed.
Retail resilience, downtown repositioning
The retail asset class has continued to be surprisingly strong, given the overall success of online shopping. Neighbourhood retail pockets throughout Winnipeg’s suburban areas, encompassing health, wellness and beauty, pharmacies, dental and medical offices, specialty boutiques and fitness studios have generally performed well. Business remains brisk in retail plazas anchored by grocery, food and liquor, with investor demand especially strong for this product.
Retail in the downtown core has continued to struggle, although a recent pilot program to “reimagine Graham Avenue” over the summer, and potentially long-term, saw empty storefronts, surface parking lots and under-utilized street spaces, reimagined with street furniture, art installations, planting, picnic tables, ping pong tables, benches and lighting features through various community organizations. Sporting events and concerts have already proven to be a draw to the downtown core. Retail shops and restaurants would be the next logical step. Bolstering foot traffic and building a vibrant culture will be key, with the Graham Avenue initiative demonstrating the potential of innovative events, experiences and activations to entice suburbanites back to the city’s core.
Many companies that are returning to the on-site office work from remote or hybrid models are expected to help populate the downtown core, generating commerce and increased safety.
Office stabilization underway
Winnipeg’s office sector could be part of the solution, with availability rates trending downward to 14.6 per cent in the fourth quarter of 2025 down from 15.7 per cent one year earlier, according to Altus Group. In addition to the solid demand for A-class buildings, some right-sizing has occurred in the market as B- and C-Class assets use innovation to re-invent their space. At least two or three buildings are now in the process of conversions made possible with tax grants from the municipality to create residential housing in vacant buildings.
Winnipeg enters 2026 on firmer footing, with improving momentum across key asset classes and growing alignment between investor expectations and market realities. While caution remains warranted in the near term, the city’s underlying fundamentals including tight industrial supply, stable rental demand, and ongoing urban reinvestment have continued to support a healthy outlook. From a broader perspective, Manitoba is expected to track in line or slightly ahead of the Canadian GDP average, supported by population growth, infrastructure investment and relative affordability. The city’s landscape is changing and the excitement is palpable. Against this backdrop, Winnipeg commercial real estate is well-positioned for the future, as stable fundamentals and renewed confidence carry the market forward.
