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Fundamentals remain unchanged, increasing vacancy continues to pull rates down
Montreal’s industrial market performance remained stable in Q4, closing out 2024. Vacancy within the Greater Montreal Area (GMA) rose by 160 basis points (bps) year over year, with the most notable increases occurring in the Vaudreuil-Soulanges submarket. Core submarkets like the South Shore, West Island and North Shore all posted decreases in vacancy from last quarter, at 70, 60, and 30 bps, respectively. Rental rates in the GMA continued their slow decline, dropping 1.4% from the prior year. Rates are now at their lowest levels since Q3 2022, two quarters before the all-time high recorded in Q1 2023. Despite the rapid rate increases during that period, downward pressure from rising vacancy is lowering rents at a slower pace. The decline in 2024 has been much slower than in 2023, suggesting rents are beginning to stabilize.