A practical, business-owner-focused snapshot of what is happening in industrial and office leasing, plus where Durham’s next growth nodes are forming.
Key Takeaways (for busy owners):
- Industrial lease renewals are resetting higher than the 2020–2021 cycle, and smaller bays (under 50,000 sq ft) are the tightest part of the market.
- Office leasing is showing an early recovery driven by demand for quality space and a stronger return-to-office trend.
- Transit and healthcare infrastructure projects are reshaping land values and development potential in Oshawa, Pickering, Courtice, and Bowmanville.
Industrial (Leasing + Occupier Demand)
Industrial remains the most expensive major asset class to rent and to buy. A mix of supply timing and global trade uncertainty continues to keep occupiers focused on efficiency and flexibility.
| Industrial Net Rent Benchmarks (approx.) | Rate |
| 2020–2021 cycle | $12 / sq ft |
| Current market | $16 / sq ft (about +37%) |
| Peak (recent) | Around $18 / sq ft |
- Vacancy rate is around 6%, driven by a delivery spike in 2025 Q1 and Q2.
- Supply is expected to be the lowest since 2018 as development slows.
- Trade tensions, tariffs, and geopolitical risk are supporting more warehousing demand in Canada, keeping industrial space priced at a premium.
- Demand for space under 50,000 sq ft is the most intense; higher rents have led many occupiers to downsize.
- Landlords are increasingly willing to subdivide larger units to meet smaller-bay demand.
- Market participants generally expect vacancy rates to fall over the next few years as absorption improves.
What this means for your business (industrial users):
- Plan early: if your lease expires in the next 12–24 months, renewals are pricing higher than the last cycle.
- If you only need a portion of your current space, ask about subdivision options or rightsizing into a smaller bay.
- If you are growing, secure expansion options now (first right / adjacent bay) while you still have choice.
Office (Early Recovery + Quality Space Demand)
- Entered an early recovery mode in Q4 2025, reaching a clearer “turning point” as demand for quality office space rises.
- The return-to-office trend gained strength during the quarter.
- Tenants are increasingly willing to make long-term commitments, especially when they can secure quality space at today’s favourable rates.
- Net rents have grown by approximately 17% year-over-year.
- Tenants targeting high-quality downtown space should begin negotiations well ahead of lease expiry to preserve choice before conditions normalize.
What this means for your business (office users):
- If you want better quality space, negotiate early and lock in incentives while pricing is still favourable.
- Use your renewal window to upgrade: layout efficiency, meeting rooms, and employee experience now matter more than ever.
- If you are unsure about headcount, explore shorter terms, expansion rights, or swing space strategies.
Durham’s Big Growth Nodes (Where Land Values Can Move)
Infrastructure and planning changes often create “gravity” for investment—higher densities, more foot traffic, and stronger demand for services. Below are the areas to watch closely.
1) Transit-Oriented Communities (TOCs) — Bowmanville GO Extension
- Station areas: Thornton’s Corners East, Ritson Road, Courtice, and Bowmanville.
- Expect mid- to high-density mixed-use around the stations, stronger land value appreciation, and intensified employment/residential uses.
- Extends the rail network about 20 km with 4 new stations, enabling two-way, all-day service and unlocking transit-oriented development potential.
2) PMTSA — Downtown Oshawa (Protected Major Transit Station Area)
- Zoning has been updated to increase densities by roughly 2x to 10x in certain areas.
- Amendments can permit up to 20-storey buildings across the downtown core and 8–12 storeys in shoulder areas.
3) Oshawa Official Plan — 407 East Innovation Corridor (Employment Lands)
- Oshawa’s Official Plan was amended in 2025 to bring the 407 East Innovation Corridor into the Major Urban Area boundary and designate the area Industrial in conformity with the Durham Regional Official Plan (Envision Durham).
- Zoning By-law 60-94 was amended to permit a range of employment uses in the area (zoned PI-A(2) and SI-A(20)/GI(5) — Prestige Industrial and Select Industrial/General Industrial).
- Frontage: Ritson Road N, Winchester Road E, Harmony Road N, and Hwy 407.
4) Pickering 407 Innovation Corridor
- Amendments would allow a broad range of uses including hotels, mixed-use buildings, offices, high-density residential, light manufacturing, institutional uses, and public facilities such as hospitals.
- Also allows select low- and medium-density residential uses and commercial areas—supporting a full live-work ecosystem.
5) Healthcare Anchors — Whitby, Uxbridge, Pickering, Bowmanville & Oshawa
- New/expanded hospital infrastructure can create sustained demand for medical offices and support services (clinics, imaging, physio, pharmacy, and housing for staff).
- A multi-site investment includes a new hospital in Whitby, a post-acute care centre in Pickering, and expansions in Bowmanville and Oshawa—creating powerful economic anchors.
How we can help
Whether you are renewing a lease, expanding into a second location, or evaluating a purchase, the goal is the same: secure the right space on the right terms—with fewer surprises.
Reach out for: lease renewal strategy, site selection, industrial/office comparisons, landlord negotiations, purchase analysis, and due diligence support.
Saman Habibi | DR Real Estate Group | 647-849-0996 | THEDRGROUP.CA
Note: Figures and statements above are based on recent market observations and should be treated as directional, not a guarantee of future performance.
Prepared by Saman Habibi REALTOR® , CPA, CA | 647-849-0996 | THEDRGROUP.CA
