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Understanding the Niagara Industrial Real Estate Market

Posted by Greg Chew on Jan 12, 2017 9:41:51 AM

industrial leasing in niagara

The Niagara industrial real estate market is in a unique position, with some of the most affordable gross lease rates in Ontario. However, there are very few industrial buildings on the market for lease or sale and the incentive to build for investors does not always make sense from a competitive perspective.   

 

Industrial Leasing in Niagara

Average lease rates within Niagara have fluctuated around the $5 mark since 2013, currently industrial lease rates across Niagara average $5.05 per square foot. This is a slight increase and is reflective of the improvements industrial property owners are making to their respective buildings. St. Catharines and Niagara-on-the-Lake command the highest average lease rates, with Niagara Falls commanding the lowest at around $4.30.

Lease rates may continue to rise for improved industrial buildings. As of August 31st 2016, industrial lease asking rates were averaging $6.04 per sq. ft. in St Catharines and $6.50 sq. ft. in Niagara-on-the-Lake. Continuing lease rate increases should help to improve incentives to invest in industrial property in Niagara.


What Niagara Needs from an Industrial Property Standpoint

There is a need across Niagara for industrial buildings with large square footage. In particular, buildings between 10,000 - 50,000 sq. ft. As members of the Niagara industrial industry grow, a need to expand out rises. Unfortunately, however, there is not enough leaseable space available on the market.

A number of cities, along with the Niagara Region, offer incentives to build industrial warehouses and properties. However, unless the company is large and requires extensive space customization, it can be more cost effective to buy already established buildings.

On another note, due to competitive incentives offered by local governments, Northern Gold Foods and GE are notable companies who have recently purchased industrial land and have built new, customized factories in Niagara.


Incentives Available for Industrial Development in Niagara

The most noteable incentive program offered within the Niagara Region is the Gateway CIP Incentive program; a geographically situated investment program that addresses development charges and a tax rebate. The Gateway program is available in five select municipalities within their designated employment lands.


If you are a Niagara industrial property owner, who has a large industrial building in your portfolio, I have buyers that are actively interested in acquiring property, click here and let's talk.

industrial warehouse space for lease

Topics: industrial real estate

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