Investment sales activity continued its upward trend, with volume increasing 17% compared to a year ago. All asset classes posted gains except for office. Despite this rise in volume, the number of properties trading remains muted, with a 12% decline compared to the start of 2024. Recent market uncertainty and volatility are weighing on deal activity in April, suggesting Q2 volume may be restrained. Private capital is the dominant force in the market today, with institutional sources a distant second. Cross-border, REIT, and user-buyer activity are limited.

Colliers Insight
Aaron Jodka
Investors deployed $92.5 billion into the major asset classes in Q1, a 17% increase from a year ago.
Share this with your followers

Office 

At this time last year, Healthpeak Properties’ acquisition of Physician’s Trust Realty drove volume higher. Absent a standout deal in Q1 2025, volume dropped. Individual property transactions increased, as did deals in CBDs. The office market still has challenges, though pricing appears to be bottoming. On an annual basis, suburban office values increased 0.5%, while CBD values fell 1.5%. However, on a quarterly basis, both segments posted gains, with an aggregate increase of 1.2%, per RCA’s CPPI.

Industrial 

Industrial volume increased 24% year-over-year to $22.3 billion. Both individual and portfolio sales rose during the quarter, supporting a broader-based rebound. Longer WALT deals are gaining traction as investors look for stable cash flow. Industrial investors are closely watching evolving policy decisions, as this asset class may face an outsized impact. An uptick in domestic production and reshoring bodes well for future demand and development, while higher trade barriers could have the opposite effect.

Multifamily 

Multifamily is the perennial leader in volume and now holds the title for strongest year-over-year gains. Investors poured $30 billion into the asset class in Q1, a 36% increase from one year ago. Fundamentals have held up remarkably well, even with the surge in development in recent quarters, giving investors added confidence in multifamily’s long-term performance. Pricing is also starting to rebound, with the RCA CPPI posting a 0.4% quarterly gain, led by garden properties.

Retail 

Retail volume eked out a 2% gain to start the year, a notable achievement given that Q1 was 2024’s strongest quarter. Blackstone’s acquisition of ROIC and a bank sale-leaseback helped prop up volume. Single-asset deals rose 1%. Consumers appear to have adjusted their spending patterns ahead of potential price increases related to tariff policy. While this has propped up overall performance, it could lead to a dip in future spending patterns.

Hospitality 

Hospitality sales are showing mixed signals. Volume increased 27% year-over-year, one of the strongest performances among all asset classes. However, last year’s Q1 was the lowest quarterly sales total since the pandemic era. Investment activity has now fallen for three consecutive quarters. Both consumer and business sentiment drive hotel room nights, each of which has faced market volatility of late. Meanwhile, investors are watching travel changes related to government policy, with early indications pointing to fewer Canadian visitors.