Research & Forecast Report GREATER AREA INDUSTRIAL MARKET

First Quarter 2019 Table of Contents

Market Summaries GTA Market Overview...... 3 GTA Central...... 4 GTA East...... 5 GTA North...... 6 GTA West...... 7 Notable Transactions & Key Statistics...... 8

Glossary...... 10 GTA Market Overview

Q1 2019 Market Trends

The GTA industrial market continues to reach new heights, Market Indicators Market Q1 Market Q1 YoY Trend breaking records set last quarter. Q1 2019 concluded Relative to prior period 2018 2019 with record industrial asking rental growth rate of 22.5% Availability Rate YoY, historic low availability of 1.2%, and continued sales 1.7% 1.2% momentum carrying over from 2018. Net Absorption (SF) 895,175 1,838,603

The historic low availability of 1.2% is unprecedented. At Under Construction (SF) 4,115,597 7,613,784 the height of the market back in 2007, availability rate Average Asking Rent (PSF) $6.41 $7.85 reached 5.3%. Strong tenant demand will continue to put upward pressure on rents. Average Sale Price (PSF) $134.75 $160.42

There is currently 7.6 million SF of industrial property under construction in the GTA, the majority of which is expected to arrive in Q3 2019 (23%), and Q4 2019 (21%). Strong tenant GTA Direct Availabilities Breakdown pre-commitment on these projects means availability of space is unlikely to improve and alleviate current demands. 50 GTA Direct Availabilities Breakdown $7.67 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 45 < 18' 26 $9.63 40 18'-21' 45 $7.67 • Q1 2019 concluded with record industrial growth in $7.55 35 22'-25' 34 $7.55 rental rates, historic low availability and continued 30 $9.63 26'-29' 18 $7.35 30'+ 10 $7.24 sales momentum carrying over from 2018. 25 20 $7.35 15 $7.24 10

• Industrial rental rates across the GTA increased to Availabilities of Number 5 $7.85 PSF from $6.41 PSF in Q1 2018 reflecting a 0 < 18' 18'-21' 22'-25' 26'-29' 30'+

22.5% YoY rental growth. Clear Height Range

NumberNumber of of Availabilities Availabilities Net AskingNet RentAsking ($PSF) Rent ($PSF) • Historic low availability and strong tenant demand 14 $9.49

will continue to put upward pressure on rents. 12 GTA Central Direct Availabilities Breakdown $6.66 $6.89 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 10 < 18' 13 $9.49 18'-21' 10 $6.66 8 Historical Performance10.0% and Forecast 800,000 22'-25' 10 $6.89 6 26'-29' 1 $6.00 3,500,000 7.0% 30'+ 2 $5.62 9.0% 4 3,000,000 6.0% 600,000$5.62 2 $6.00 8.0% Availabilities of Number 5.0% 2,500,000 0 7.0% < 18' 18'-21' 22'-25' 26'-29' 400,00030'+ 2,000,000 4.0% Clear Height Range 1,500,0006.0% 3.0% Number of Availabilities Net Asking Rent ($PSF) 200,000 1,000,0005.0% 2.0% 4 1.2% 1.1% 500,000 1.0% - 4.0% $6.37 $6.76 3 GTA East Direct Availabilities Breakdown 0 0.0% Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 3.0% (200,000)< 18' 1 $6.00 $5.81 18'-21' 2 $5.81 -500,000 2 -1.0% 2.0% Availability Rate (%) 22'-25' 1 $6.50 26'-29' 3 $6.37 Absorption/New Supply (SF) Absorption/NewSupply -1,000,000 -2.0% (400,000)30'+ 3 $6.76 1.0% 1 -1,500,000 -3.0% 0.0% Availabilities of Number (600,000) -2,000,000 0 -4.0% < 18' 18'-21' 22'-25' 26'-29' 30'+

-2,500,000 Clear Height Range -5.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2011 Q1 2011 Q3 Q1 2013 2011 Q4 Q1 2014 2011 Q2 2012 Q1 2010 Q1 Number of Availabilities Net Asking Rent ($PSF) 2013 Q3 2013 2013 Q4 2013 2012 Q3 Q2 2013 2010 Q3 2012 Q4 Q2 2014 2012 Q2 2010 Q4 2010 Q2 2009 Q32009 2009 Q42009 2009 Q22009 2015 2016 2017 2018 2019 2020 2021 12 $10.14 NetNet Absorption Absorption (SF) New SupplyNew Supply (SF)Availability Rate Vacancy Rate (%) 1,500,000 10 3.0%

8 GTA North Direct Availabilities Breakdown Clear Height Number of AvailabilitieNet Asking Rent ($PSF) < 18' 5 $9.07 6 1,000,000 Research & Forecast Report | Q1 2019 | Greater Toronto$9.07 Area / Industrial $ 8|. 17 Colliers $International7.432.0% 318'-21' 11 $10.14 22'-25' 5 $8.17 4 1.2% 26'-29' 5 $7.43 $6.45 30'+ 2 $6.45 2 0.9% 500,000 Availabilities of Number 1.0% 0 < 18' 18'-21' 22'-25' 26'-29' 30'+

0 Clear Height Range 0.0%

Number of Availabilities Net Asking Rent ($PSF)

25 -500,000 $7.11 -1.0% Availability Availability Rate (%) GTA West Direct Availabilities Breakdown

Absorption/New Supply (SF) Absorption/NewSupply 20 $7.76 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) < 18' 7 $10.66 -1,000,000 15 -2.0% 18'-21' 22 $7.11 22'-25' 18 $7.76 26'-29' 9 $7.86 10 $7.86 $10.66 30'+ 3 $7.56 -1,500,000 -3.0% 5 $7.56

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2Availabilities of Number Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 20180 2019 2020 2021 < 18' 18'-21' 22'-25' 26'-29' 30'+

Clear Height Range 800,000 6.0% Number of Availabilities Net Asking Rent ($PSF)

600,000 3.6% 4.0%

400,000 1.8% 2.0%

200,000 0.0%

0 -2.0% Availability Availability Rate (%) Absorption/New Supply (SF) Absorption/NewSupply

-200,000 -4.0%

-400,000 -6.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021

1,500,000 6.0%

1,250,000 5.0%

1,000,000 4.0%

750,000 3.0%

500,000 2.0%

250,000 0.8% 1.0%

0.1% Availability Rate (%)

Absorption/New Supply (SF) Absorption/NewSupply 0 0.0%

-250,000 -1.0%

-500,000 -2.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021

3,000,000 6.0%

2,500,000 5.0%

2,000,000 4.0%

1,500,000 3.0%

1,000,000 2.0% 1.6%

1.2% Availability Availability Rate (%) 500,000 1.0% Absorption/New Supply (SF) Absorption/NewSupply

0 0.0%

-500,000 -1.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021 GTA Central

GTA Central market reported the second lowest availability Summary Statistics rate in the GTA at 0.9% in Q1 2019. Due to the lack of Q1 2019 Regional Industrial Market 2018 Q1 2019 Q1 YoY Trend available space, average asking net rents reached a new high of $7.73 PSF with rents growing at 34.0% YoY. Availability Rate 1.1% 0.9%

About 370,000 SF of new supply was leased at 1395 Net Absorption (SF) -75,471 166,717 Tapscott Road in by H. Paulin & Co which 50 GTA Direct Availabilities Breakdown Under Construction (SF)$7.67 1,034,588 1,424,357 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) signed a 10-year lease. A total of 1.4 million SF is currently 45 < 18' 26 $9.63 under construction in GTA Central, a significant ramp-up in 40 18'-21' 45 $7.67 $7.55 activity compared to recent years. Between 2013 to 2018, Average35 Asking Rent (PSF) $5.77 $7.73 22'-25' 34 $7.55 30 $9.63 26'-29' 18 $7.35 30'+ 10 $7.24 an average of only 50,000 SF of new supply was added to 25 the Central market each year. Average20 Sale Price (PSF) $126.38 $7.$144.8635 15 $7.24 10

Number of Availabilities of Number 5 0 Trends 3,500,000 < 18' 18'-21' 22'-25' 26'-29'7.0% 30'+ GTA Central Direct AvailabilitiesClear Height Range Breakdown >> The GTA 3,000,000Central market remains tight at 0.9% in Q1 2019, the 6.0% lowest availability rate in the GTA. Number of Availabilities Net Asking Rent ($PSF) 2,500,000 5.0% 14 >> The lack of available space has seen average asking net rents $9.49 2,000,000 12 4.0% GTA Central Direct Availabilities Breakdown reach $7.73 PSF with a rental growth of 34.0% YoY. $6.66 $6.89 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 1,500,000 10 3.0% < 18' 13 $9.49 18'-21' 10 $6.66 >> A total of 1.4 million SF is currently under construction in GTA 8 1,000,000 2.0% 22'-25' 10 $6.89 Central, a significant ramp-up in activity compared to recent 1.2% 26'-29' 1 $6.00 6 1.1% years. 500,000 1.0% 30'+ 2 $5.62 4 $5.62 0 2 $6.000.0% Number of Availabilities of Number

-500,000 0 -1.0% < 18' 18'-21' 22'-25' 26'-29' Availability Rate (%) 30'+

Absorption/New Supply (SF) Absorption/NewSupply -1,000,000 Clear Height Range -2.0%

Number of Availabilities Net Asking Rent ($PSF) -1,500,000 Number of Availabilities Net Asking Rent-3.0% ($PSF)

4 -2,000,000 -4.0%

$6.37 $6.76 -2,500,000 3 -5.0% GTA East Direct Availabilities Breakdown Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) < 18' 1 $6.00 $5.81 18'-21' 2 $5.81 2015 2016 2017 20182 2019 2020 2021 Historical Performance and Forecast 22'-25' 1 $6.50 26'-29' 3 $6.37 10.0% 800,00030'+ 3 $6.76 1,500,000 1 3.0%

9.0% Availabilities of Number 0 600,000 1,000,000 8.0% < 18' 18'-21' 22'-25' 26'-29'2.0% 30'+ 7.0% Clear Height Range 400,000 Number of Availabilities Net Asking Rent1.2% ($PSF) 500,000 6.0% 0.9% 1.0% 12 $10.14 200,000

5.0% 10

0 8 0.0% - GTA North Direct Availabilities Breakdown 4.0% Clear Height Number of AvailabilitieNet Asking Rent ($PSF) < 18' 5 $9.07 6 3.0% $9.07 $8.17 $7.43 18'-21' 11 $10.14 (200,000)22'-25' 5 $8.17 -500,000 4 -1.0%

Availability Availability Rate (%) 26'-29' 5 $7.43 2.0% $6.45 30'+ 2 $6.45

Absorption/New Supply (SF) Absorption/NewSupply 2

Number of Availabilities of Number (400,000) 1.0% 0 -1,000,000 -2.0% < 18' 18'-21' 22'-25' 26'-29' 30'+ 0.0% (600,000) Clear Height Range

Number of Availabilities Net Asking Rent ($PSF) -1,500,000 -3.0%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q325 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2011 Q1 2011 Q3 Q1 2013 2011 Q4 Q1 2014 2011 Q2 2012 Q1 2010 Q1 2013 Q3 2013 2013 Q4 2013 2012 Q3 Q2 2013 2010 Q3 2012 Q4 Q2 2014 2012 Q2 $7.11 2010 Q4 2010 Q2 2009 Q32009 2009 Q42009 2009 Q22009 2015 2016 2017 2018 2019 2020 2021 GTA West Direct Availabilities Breakdown 20 $7.76 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) NetNet Absorption Absorption (SF) New SupplyNew Supply (SF)Availability Rate Vacancy Rate (%) < 18' 7 $10.66 800,000 15 6.0% 18'-21' 22 $7.11 22'-25' 18 $7.76 26'-29' 9 $7.86 10 $7.86 $10.66 30'+ 3 $7.56 4 Research600,000 & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International 3.6% 4.0% 5 $7.56 Number of Availabilities of Number

0 400,000 1.8%< 18' 18'-21' 22'-25' 26'-29'2.0% 30'+ Clear Height Range

Number of Availabilities Net Asking Rent ($PSF) 200,000 0.0%

0 -2.0% Availability Availability Rate (%) Absorption/New Supply (SF) Absorption/NewSupply

-200,000 -4.0%

-400,000 -6.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021

1,500,000 6.0%

1,250,000 5.0%

1,000,000 4.0%

750,000 3.0%

500,000 2.0%

250,000 0.8% 1.0%

0.1% Availability Rate (%)

Absorption/New Supply (SF) Absorption/NewSupply 0 0.0%

-250,000 -1.0%

-500,000 -2.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021

3,000,000 6.0%

2,500,000 5.0%

2,000,000 4.0%

1,500,000 3.0%

1,000,000 2.0% 1.6%

1.2% Availability Availability Rate (%) 500,000 1.0% Absorption/New Supply (SF) Absorption/NewSupply

0 0.0%

-500,000 -1.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021 3,500,000 50 7.0% GTA Direct Availabilities Breakdown $7.67 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 45 3,000,000 6.0% < 18' 26 $9.63 40 18'-21' 45 $7.67 $7.55 2,500,000 35 5.0% 22'-25' 34 $7.55 30 $9.63 26'-29' 18 $7.35 GTA East 30'+ 10 $7.24 2,000,000 25 4.0% 20 $7.35 The GTA East’s largest investment transaction in Q1 2019, 15 1,500,000 Summary Statistics 3.0% $7.24 by both size and dollar volume, took place in Whitby. Bentall Q1 201910 Regional Industrial Market 2018 Q1 2019 Q1 YoY Trend

1,000,000 Availabilities of Number 5 2.0% Kennedy purchased 185 William Smith Drive, approximately 1.2% Availability0 Rate 0.9% 1.1% 1.8% 220,000 SF500,000 property for $27.5 million. This is the second < 18' 18'-21' 22'-25' 26'-29'1.0% 30'+ consecutive quarter a property exceeding 200,000 SF sold Clear Height Range 0 Net Absorption (SF) 76,277 0.0%-32,862 for $25 million plus taking place in Whitby. Number of Availabilities Net Asking Rent ($PSF) -500,000 -1.0% Availability Availability Rate (%) 14 $9.49

Absorption/New Supply (SF) Absorption/NewSupply Under Construction (SF) Carttera -1,000,000is developing two buildings at 1652 Tricont Avenue 20,600 -2.0%700,000 12 GTA Central Direct Availabilities Breakdown totalling 370,000 SF with completion expected by Q4 2019. $6.66 $6.89 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) -1,500,000 -3.0% This is the first speculative development in the GTA East Average10 Asking Rent (PSF) $5.90 $6.39 < 18' 13 $9.49 18'-21' 10 $6.66 8 since 2016.-2,000,000 Also expected to be completed by the end -4.0% 22'-25' 10 $6.89 6 26'-29' 1 $6.00 of 2019 is-2,500,000 the Gordon Food Services’ new 330,000 SF Average Sale Price (PSF) $73.83 -5.0%$116.44 30'+ 2 $5.62 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 4 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 distribution centre at 200 Salem Road North in Ajax. $5.62 2 $6.00 2015 2016 2017 2018 Availabilities of Number 2019 2020 2021 0 < 18' 18'-21' 22'-25' 26'-29' 30'+ 1,500,000 3.0% Trends GTA East Direct AvailabilitiesClear Height RangeBreakdown Number of Availabilities Net Asking Rent ($PSF) >> After two consecutive quarters of decreasing rental rates, the GTA East’s1,000,000 asking net rental rate increased by over $0.50 and 4 2.0%

now sits at an all-time high of $6.39 PSF. $6.37 $6.76 3 1.2% GTA East Direct Availabilities Breakdown 0.9% Clear Height Number of AvailabilitieNet Asking Rent ($PSF) >> GTA East500,000 has only 10 direct availabilities over 15,000 SF in 1.0% < 18' 1 $6.00 $5.81 18'-21' 2 $5.81 2 existing building stock. The lack of availabilities resulted in 22'-25' 1 $6.50 less than 100,000 SF of direct vacant space for the first time 26'-29' 3 $6.37 $6.00 $6.50 30'+ 3 $6.76 in nearly two 0years. 1 0.0% Number of Availabilities of Number

0 -500,000 < 18' 18'-21' 22'-25' 26'-29'-1.0% 30'+ Availability Availability Rate (%) Clear Height Range Absorption/New Supply (SF) Absorption/NewSupply

Number of Availabilities Net Asking Rent ($PSF) Number of Availabilities Net Asking Rent ($PSF) -1,000,000 -2.0% 12 $10.14

10 -1,500,000 -3.0% 8 GTA North Direct Availabilities Breakdown Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) < 18' 5 $9.07 6 $9.07 $8.17 $7.43 2015 2016 2017 2018 2019 2020 2021 18'-21' 11 $10.14 Historical Performance and Forecast 22'-25' 5 $8.17 4 10.0% 800,00026'-29' 5 $7.43 $6.45 30'+ 2 $6.45 800,000 2 6.0% 9.0% Availabilities of Number 0 600,000 < 18' 18'-21' 22'-25' 26'-29' 30'+ 8.0% 3.6% 600,000 Clear Height Range 4.0% 400,000 7.0% Number of Availabilities Net Asking Rent ($PSF)

400,000 6.0% 25 1.8% 2.0% $7.11 200,000 GTA West Direct Availabilities Breakdown 5.0% 20 $7.76 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) - < 18' 7 $10.66 200,000 4.0% 15 0.0% 18'-21' 22 $7.11 22'-25' 18 $7.76 26'-29' 9 $7.86 10 $7.86 3.0% $10.66 (200,000)30'+ 3 $7.56 0 -2.0% 2.0% 5 $7.56 Availability Availability Rate (%) Number of Availabilities of Number

Absorption/New Supply (SF) Absorption/NewSupply (400,000) 1.0% 0 -200,000 < 18' 18'-21' 22'-25' 26'-29'-4.0% 30'+ 0.0% Clear Height Range (600,000) Number of Availabilities Net Asking Rent ($PSF) -400,000 -6.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2011 Q1 2011 Q3 Q1 2013 2011 Q4 Q1 2014 2011 Q2 2012 Q1 2010 Q1 2013 Q3 2013 2013 Q4 2013 2012 Q3 Q2 2013 2010 Q3 2012 Q4 Q2 2014 2012 Q2 2010 Q4 2010 Q2 2009 Q32009 2009 Q42009 2009 Q22009 2015 2016 2017 2018 2019 2020 2021 Net Absorption New Supply Availability Rate 1,500,000 Net Absorption (SF) New Supply (SF) Vacancy Rate6.0% (%)

1,250,000 5.0% Research & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International 5 1,000,000 4.0%

750,000 3.0%

500,000 2.0%

0.8% 250,000 1.0%

0.1% Availability Rate (%)

Absorption/New Supply (SF) Absorption/NewSupply 0 0.0%

-250,000 -1.0%

-500,000 -2.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021

3,000,000 6.0%

2,500,000 5.0%

2,000,000 4.0%

1,500,000 3.0%

1,000,000 2.0% 1.6%

1.2% Availability Availability Rate (%) 500,000 1.0% Absorption/New Supply (SF) Absorption/NewSupply

0 0.0%

-500,000 -1.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021 3,500,000 7.0%

3,000,000 6.0%

2,500,000 5.0%

2,000,000 4.0%

1,500,000 3.0%

1,000,000 2.0% 1.2% 1.1% 500,000 1.0%

0 0.0%

-500,000 -1.0% Availability Availability Rate (%) 50 GTA Direct Availabilities Breakdown $7.67 Absorption/New Supply (SF) Absorption/NewSupply Clear Height Number of AvailabilitieNet Asking Rent ($PSF) -1,000,000 45 -2.0% < 18' 26 $9.63 40 18'-21' 45 $7.67 -1,500,000 $7.55 -3.0% 35 22'-25' 34 $7.55 30 $9.63 26'-29' 18 $7.35 -2,000,000 -4.0% 30'+ 10 $7.24 25 $7.35 -2,500,000 20 -5.0% 15 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 $7.24 10

2015 2016 2017 2018Availabilities of Number 5 2019 2020 2021 0 < 18' 18'-21' 22'-25' 26'-29' 30'+ 1,500,000 3.0% Clear Height Range

Number of Availabilities Net Asking Rent ($PSF)

1,000,000 14 $9.49 2.0%

12 GTA Central Direct Availabilities Breakdown $6.66 $6.89 1.2% Clear Height Number of AvailabilitieNet Asking Rent ($PSF) GTA North 10 0.9% < 18' 13 $9.49 500,000 1.0% 18'-21' 10 $6.66 8 In Q1 2019, close to one million SF was absorbed in GTA 22'-25' 10 $6.89 Summary6 Statistics 26'-29' 1 $6.00 North, greater than any other GTA markets. Give & Go Q1 2019 Regional Industrial Market 2018 Q1 2019 Q1 YoY Trend 30'+ 2 $5.62 0 4 0.0% Prepared Foods leased two buildings in Vaughan, 150 $5.62 Availability2 Rate 1.3% $6.00 0.8% Gibraltar Road and 7245 Highway 50, for a combined total of Availabilities of Number over 600,000 SF. 0 -500,000 Net Absorption< 18' (SF) 18'-21' 22'-25' 26'-29' -1.0% 30'+ 98,947 990,940 Availability Rate (%) Clear Height Range Direct availabilities(SF) Absorption/NewSupply in the GTA North are predominately in the 18’ to 21’ clear height range, representing over 39% of all Under ConstructionNumber (SF) of Availabilities 1,241,180Net Asking Rent 1,021,329($PSF) -1,000,000 -2.0% availabilities. Ozery Bakery purchased 11 Director Court in 4 Vaughan for over $11.5 million in February 2019. Average Asking Rent (PSF) $6.73 $8.70 $6.37 $6.76 3 GTA East Direct Availabilities Breakdown -1,500,000 -3.0% Clear Height Number of AvailabilitieNet Asking Rent ($PSF) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2AverageQ3 Q4Sale Q1PriceQ2 (PSF)Q3 Q4 Q1 Q2$150.41Q3 Q4 Q1$197.83 < 18' 1 $6.00 $5.81 18'-21' 2 $5.81 2 2015 2016 2017 2018 2019 2020 2021 22'-25' 1 $6.50 Trends 26'-29' 3 $6.37 30'+ 3 $6.76 1 >> Average 800,000asking rental rates increased by over $1.00 QoQ in the 6.0% GTA North, the largest increase of all the GTA markets. This Availabilities of Number GTA0 North Direct Availabilities Breakdown was spurred by Vaughan’s net rental rates increasing by 21.1% < 18' 18'-21' 22'-25' 26'-29' 30'+ 3.6% QoQ. 600,000 Clear Height Range 4.0% >> The level of positive absorption in the GTA North has increased Number of Availabilities Net Asking Rent ($PSF) 1.8% for four 400,000consecutive quarters, the most when compared to 12 $10.14 2.0% other GTA markets. Industrial space continues to be taken 10 up at an increasing rate due to the submarkets proximity to 8 GTA North Direct Availabilities Breakdown existing 200,000highways and central location. 0.0% Clear Height Number of AvailabilitieNet Asking Rent ($PSF) < 18' 5 $9.07 6 $9.07 $8.17 $7.43 18'-21' 11 $10.14 22'-25' 5 $8.17 4 26'-29' 5 $7.43 0 -2.0% $6.45 30'+ 2 $6.45 2 Availability Availability Rate (%) Number of Availabilities of Number

Absorption/New Supply (SF) Absorption/NewSupply 0 -200,000 < 18' 18'-21' 22'-25' 26'-29' -4.0% 30'+ Clear Height Range

Number of Availabilities Net Asking Rent ($PSF) Number of Availabilities Net Asking Rent ($PSF) -400,000 -6.0% 25 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3$7.1Q41 Q1 Q2 Q3 Q4 Q1 GTA West Direct Availabilities Breakdown Historical Performance2015 and Forecast2016 2017 201820 2019 2020$7.76 2021 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) < 18' 7 $10.66 1,500,000 15 6.0% 18'-21' 22 $7.11 10.0% 800,000 22'-25' 18 $7.76 26'-29' 9 $7.86 10 $7.86 9.0% $10.66 30'+ 3 $7.56 1,250,000 5.0% 600,000 8.0% 5 $7.56 Number of Availabilities of Number 1,000,000 7.0% 0 4.0% 400,000 < 18' 18'-21' 22'-25' 26'-29' 30'+ 6.0% Clear Height Range 750,000 3.0% 200,000 5.0% Number of Availabilities Net Asking Rent ($PSF) 500,000 2.0% - 4.0% 0.8% 250,000 3.0% 1.0% (200,000)

2.0% 0.1% Availability Rate (%) Absorption/New Supply (SF) Absorption/NewSupply 0 0.0% (400,000) 1.0% -250,000 0.0% -1.0% (600,000)

-500,000 -2.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2011 Q1 2011 Q3 Q1 2013 2011 Q4 Q1 2014 2011 Q2 2012 Q1 2010 Q1 2013 Q3 2013 2013 Q4 2013 2012 Q3 Q2 2013 2010 Q3 2012 Q4 Q2 2014 2012 Q2 2010 Q4 2010 Q2 2009 Q32009 2009 Q42009 2015 Q22009 2016 2017 2018 2019 2020 2021 NetNet Absorption Absorption (SF) New SupplyNew Supply (SF)Availability Rate Vacancy Rate (%) 3,000,000 6.0%

6 Research2,500,000 & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International 5.0%

2,000,000 4.0%

1,500,000 3.0%

1,000,000 2.0% 1.6%

1.2% Availability Availability Rate (%) 500,000 1.0% Absorption/New Supply (SF) Absorption/NewSupply

0 0.0%

-500,000 -1.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021 3,500,000 7.0%

3,000,000 6.0%

2,500,000 5.0%

2,000,000 4.0%

1,500,000 3.0%

1,000,000 2.0% 1.2% 1.1% 500,000 1.0%

0 0.0%

-500,000 -1.0% Availability Availability Rate (%)

Absorption/New Supply (SF) Absorption/NewSupply -1,000,000 -2.0%

-1,500,000 -3.0%

-2,000,000 -4.0%

-2,500,000 -5.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 2017 2018 2019 2020 2021

1,500,000 3.0% 50 GTA Direct Availabilities Breakdown $7.67 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 45 < 18' 26 $9.63 40 18'-21' 45 $7.67 $7.55 1,000,000 35 2.0% 22'-25' 34 $7.55 30 $9.63 26'-29' 18 $7.35 30'+ 10 $7.24 25 1.2% 20 $7.35 500,000 0.9% 1.0% 15 $7.24 10

Number of Availabilities of Number 5 0 0 0.0% < 18' 18'-21' 22'-25' 26'-29' 30'+

Clear Height Range

Number of Availabilities Net Asking Rent ($PSF) -500,000 -1.0% Availability Availability Rate (%) 14 $9.49 Absorption/New Supply (SF) Absorption/NewSupply 12 GTA Central Direct Availabilities Breakdown $6.66 $6.89 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) -1,000,000 10 -2.0% < 18' 13 $9.49 18'-21' 10 $6.66 8 22'-25' 10 $6.89 6 26'-29' 1 $6.00 -1,500,000 -3.0% 30'+ 2 $5.62 4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 $5.62 2 $6.00 2015 2016 2017 2018Availabilities of Number 2019 2020 2021 0 < 18' 18'-21' 22'-25' 26'-29' 30'+

800,000 Clear Height Range 6.0%

Number of Availabilities Net Asking Rent ($PSF)

4 600,000 3.6% 4.0%

$6.37 $6.76 GTA West 3 GTA East Direct Availabilities Breakdown Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 1.8% < 18' 1 $6.00 400,000 $5.81 2.0% 18'-21' 2 $5.81 Over 700,000 SF of existing buildings were absorbed in 2 Summary Statistics 22'-25' 1 $6.50 the GTA West in Q1 2019, despite no new supply added this Q1 2019 Regional Industrial Market 2018 Q1 2019 Q1 YoY Trend 26'-29' 3 $6.37 30'+ 3 $6.76 quarter. The average asking net rent grew strongly at 20.1% 1 200,000 Availability Rate 2.3% 1.6%0.0%

YoY in Q1 2019. Availabilities of Number 0 The higher asking rents in and have Net Absorption< 18' (SF) 18'-21' 22'-25'795,422 26'-29'713,808 30'+ prompted tenants0 to look for space further west in Milton Clear Height Range -2.0% and Halton Hills, where over 450,000 SF were absorbed Under Construction Number(SF) of Availabilities 1,819,229Net Asking Rent ($PSF)4,468,098 Availability Rate (%) Absorption/New Supply (SF) Absorption/NewSupply this quarter, making up nearly two-thirds of the activity in 12 -200,000 $10.14 -4.0% Average Asking Rent (PSF) the GTA West market. A notable lease transaction included 10 $6.56 $7.88 6 Cleve Court in Halton Hills where Metrie has signed a new 8 GTA North Direct Availabilities Breakdown 10-year lease on a 240,000 SF building. A wave of new Average Sale Price (PSF) $141.02 $169.30 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) -400,000 -6.0% < 18' 5 $9.07 6 $9.07 $8.17 $7.43 industrial supply isQ1 expectedQ2 Q3 toQ4 arriveQ1 Q2 in Q3 2019Q4 Q1 totallingQ2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 18'-21' 11 $10.14 22'-25' 5 $8.17 1.6 million SF. This includes DSV Global Transport and 4 2015 2016 2017 2018 2019 2020 2021 26'-29' 5 $7.43 $6.45 30'+ 2 $6.45 Logistics’ state-of-the-art 1.1 million SF Milton industrial 2 building. 1,500,000 Availabilities of Number 6.0% GTA0 West Direct Availabilities Breakdown < 18' 18'-21' 22'-25' 26'-29' 30'+ Strong investor1,250,000 appetite continues to push average industrial Clear Height Range 5.0% yields downwards to 4.5% in the GTA West. Significant sale Number of Availabilities Net Asking Rent ($PSF) transactions this quarter include Menkes’ purchase of 2301- 1,000,000 25 4.0% 2311 Royal Windsor Drive, a 204,000 SF property located in $7.11 GTA West Direct Availabilities Breakdown Mississauga South/East submarket for $25.7 million. 20 $7.76 Clear Height Number of AvailabilitieNet Asking Rent ($PSF) 750,000 3.0% < 18' 7 $10.66 15 18'-21' 22 $7.11 Trends 22'-25' 18 $7.76 500,000 2.0% 26'-29' 9 $7.86 10 $7.86 >> The average asking net rent increased 20.1% YoY in Q1 2019 $10.66 30'+ 3 $7.56

highlighting strong growth and tenant activity. 5 0.8% $7.56 250,000 1.0% Number of Availabilities of Number >> Availability rate declined this quarter to 1.6% from 1.9% in Q4 0 0.1% Availability Rate (%) 2018, reaching a new record low. < 18' 18'-21' 22'-25' 26'-29' 30'+ Absorption/New Supply (SF) Absorption/NewSupply 0 0.0% Clear Height Range >> There is just under 4.5 million SF of industrial developments Number of Availabilities Net Asking Rent ($PSF) under construction-250,000 in the GTA West. A wave of new industrial Number of Availabilities Net Asking Rent ($PSF)-1.0% supply is expected to arrive in Q3 2019 totalling 1.6 million SF. -500,000 -2.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 10.0%2015 2016 2017 2018 2019 2020 2021 800,000 Historical Performance and Forecast 9.0% 3,000,000 6.0% 600,000 8.0% 2,500,000 7.0% 5.0% 400,000 6.0% 2,000,000 4.0% 200,000 5.0% - 1,500,000 4.0% 3.0%

3.0% (200,000) 1,000,000 2.0% 2.0% 1.6% 1.2%

(400,000) Availability Rate (%) 500,000 1.0%

Absorption/New Supply (SF) Absorption/NewSupply 1.0% 0.0% (600,000) 0 0.0% 2011 Q1 2011 Q3 Q1 2013 2011 Q4 Q1 2014 2011 Q2 2012 Q1 2010 Q1

-500,000 Q3 2013 -1.0% 2013 Q4 2013 2012 Q3 Q2 2013 2010 Q3 2012 Q4 Q2 2014 2012 Q2 2010 Q4 2010 Q2 2009 Q32009 2009 Q42009 2009 Q22009 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015 2016 NetNet Absorption Absorption2017 (SF) New Supply2018New Supply (SF)Availability2019 Rate Vacancy2020 Rate2021 (%)

Research & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International 7 Notable Transactions & Key Statistics

Market Stats

INDUSTRIAL PROPORTION OF CURRENTLY UNDER # OF AVAILABILITY ABSORPTION AVERAGE ASKING MARKET INVENTORY SUBLEASE AVAILABILITY CONSTRUCTION BUILDINGS RATE (%) (SF) NET RENT ($) (SF) (%) (SF)

GTA 12,189 808,947,571 1.2% 15.6% 1,838,603 $7.85 7,613,784

GTA Central 4,076 243,040,539 0.9% 11.9% 166,717 $7.73 1,424,357

Suburbs 8,113 565,907,032 1.4% 16.5% 1,671,886 $7.93 6,189,427

GTA East 536 37,370,443 1.8% 5.1% -32,862 $6.39 700,000

GTA North 2,656 154,550,138 0.8% 4.0% 990,940 $8.70 1,021,329

GTA West 4,921 373,986,451 1.6% 20.4% 713,808 $7.88 4,468,098

Notable Lease Transactions

TENANT ADDRESS AREA (SF) MARKET LEASE TYPE

Give & Go 150 Gibraltar Road 375,000 North - Vaughan Head Lease

Wesbell Logistics 6135 Kennedy Road 264,860 West - Sub Lease

Metrie 6 Cleve Court 240,000 West - Halton Hills Head Lease

Give & Go 7245 Highway 50 240,000 North - Vaughan Head Lease

Martinrea International Inc. 6655 Northwest Drive 201,046 West - Mississauga East Head Lease

Corporate Express Canada, Inc. 550 Pendant Drive 170,472 West - Mississauga West Extension

TOC Logistics Incorporated 12880 Coleraine Drive 150,000 West - Caledon Head Lease

IMCD Canada Limited 99 Summerlea Road 109,394 West - Extension Upper Canada Soap & Candle Makers Corporation 5875 Chedworth Way 101,933 West - Mississauga Central / West Head Lease

Notable Industrial Developments

AREA ESTIMATED ADDRESS OWNER/DEVELOPER MUNICIPALITY BUILDING STATUS (SF) COMPLETION

Fifth Line 1,100,000 2019 Q3 DSV Solutions Inc. West - Milton Under Construction

12724 Coleraine Drive 966,242 2020 Q1 Blackwood Partners Inc. West - Caledon Under Construction

2233 Sheppard Avenue West, Bldg A 823,558 2019 Q2 One Property Limited Central - Weston Under Construction

1652 Tricont Avenue 370,000 2019 Q4 Carttera East - Whitby Under Construction

200 Salem Road North 330,000 2019 Q4 Gordon Food Service East - Ajax Under Construction

20 Westbridge Drive 324,706 2019 Q4 QuadReal West - Halton Hills Under Construction

2299 Hogan Drive 303,918 2019 Q3 Orlando Corporation West - Mississauga Meadowvale Under Construction

6050 Millcreek Drive 303,594 2020 Q1 Orlando Corporation West - Mississauga Meadowvale Under Construction Pure Industrial Real 75 Venture Drive 295,087 2019 Q2 Estate Trust Central - Scarborough East Under Construction

6415 Northam Drive 205,877 2019 Q4 Orlando Corporation West - Mississauga East Under Construction

8 Research & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International Research & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International 9 Glossary

YoY: Year over Year, the change from one year to the next. QoQ: Quarter over Quarter, the change from one quarter to the next. Weighted Average Asking Net Rent: The dollar amount requested by landlords for an available space, expressed as an average based on the weight of available space. Availability: The total amount of space that is currently being marketed as available for lease or sublease at the end of the quarter. It includes space that is available, regardless of whether the space is vacant or occupied. Net Absorption: The net absorption in available space in a given market between the current quarter and the previous quarter. Direct Availability: Space that is being offered for lease directly from the landlord or owner of a building, not space by another tenant in the building trying to sublet a space that has already been leased. Sublease Availability: Sublet space that is available for sublease by a tenant to another lessee for a term equal to or shorter than that held by the tenant under its original lease with the landlord. Under Construction: Buildings where actual ground breaking has occurred (site excavation or foundation poured) and construction is ongoing (not abandoned or discontinued) but for which a certificate of occupancy has not yet been issued. New Supply: Total square footage with completed construction, where all that remains is the installation of tenant finishes. GTA Central: Includes East York, , North York, Scarborough, Toronto, and York. GTA East: Includes Ajax, Oshawa, Pickering, and Whitby.

GTA North: Includes Aurora, Markham, Newmarket, Richmond Hill, Vaughan, and Whitchurch-Stouffville. GTA West: Includes Brampton, Burlington, Caledon, Halton Hills, Milton, Mississauga, and Oakville.

10 Research & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International Forecast Assumptions & Terminology Survey results presented on this report have been condensed for reference. Results are updated periodically to ensure accuracy and therefore historically published results are subject to change.

Absorption was calculated using moving averages of 40 trailing quarters of absorption data and implemented with incoming new speculative and build-to-suit developments.

Colliers International has adopted NAIOP’s terms and definitions which is reflected in this glossary and report.

Research & Forecast Report | Q1 2019 | Greater Toronto Area / Industrial | Colliers International 11 MARKET CONTACT: 400+ offices in Peter Garrigan Managing Director, Industrial Practice Group 68 countries on Toronto Region DIRECT: +1 (416) 620 2854 6 continents [email protected] United States: 155 REGIONAL AUTHORS: Canada: 48 Leo Lee Senior Market Intelligence Analyst | Toronto Latin America: 20 DIRECT: +1 (416) 620 2839 Asia Pacific:94 [email protected] EMEA: 119 Vishal Rajan Market Intelligence Analyst | Toronto DIRECT: +1 (416) 620 2867 [email protected] $3.3B Max Shapinko US* in annual Market Intelligence Coordinator | Toronto revenue DIRECT: +1 (416) 791 7256 [email protected] 2B Colliers International | Toronto 181 Bay Street, Suite 1400 square feet Toronto, ON | Canada under management +1 416 777 2200 17,300 professionals and staff

*Based on 2018 results About Colliers International Group Inc. Colliers International Group Inc. is an industry-leading real estate services company with a global brand operating in 68 countries and a workforce of more than 17,300 skilled professionals serving clients in the world’s most important markets. Colliers is the fastest-growing publicly listed global real estate services company, with 2018 corporate revenues of $2.8 billion ($3.3 billion including affiliates). With an enterprising culture and significant employee ownership and control, Colliers professionals provide a full range of services to real estate occupiers, owners and investors worldwide. Services include strategic advice and execution for property sales, leasing and finance; global corporate solutions; property, facility and project management; workplace solutions; appraisal, valuation and tax consulting; customized research; and thought leadership consulting.

Colliers professionals think differently, share great ideas and offer thoughtful and innovative advice that help clients accelerate their success. Colliers has been ranked among the top 100 global outsourcing firms by the International Association of Outsourcing Professionals for 13 consecutive years, more than any other real estate services firm. Colliers has also been ranked the number one property manager in the world by Commercial Property Executive for two years in a row. colliers.com

Copyright © 2019 Colliers International. The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report.