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“Location, location, location” replaced by “COVID, COVID, COVID”

Author(s): Paul Morassutti

Dec 8, 2020

The fairly robust performance of the Canadian real estate market in 2019 continued into 2020 … and then the COVID-19 pandemic hit. COVID-19 impacted each sector of the real estate market differently, each for different reasons. While retail real estate was severely and detrimentally affected, industrial real estate appears relatively unscathed. The jury is still out regarding the effect of COVID-19 on the office sector.

Retail real estate

Hardest hit was the retail sector. Retail real estate was already showing signs of softening before the arrival of COVID-19 due to a slowing of new entrants into the Canadian market and a continuing migration by shoppers to e-commerce. COVID-19 dramatically and almost instantly hurt the retail real estate sector, as governments ordered retail centres across Canada to close in March. Some provinces allowed them to re-open in May, others not until July. These closures had a number of significant and immediate impacts...