FOCUS | CANADA
the industrial construction sector is expected to grow at an annual growth rate of 1.2% in 2027–29, supported by waste processing and manufacturing project investment.
Industrial construction outlook With an annual growth of 2.2% expected in 2025, according to Statistics Canada, the total value of investment in industrial buildings grew by 4.6% YoY in Q1 2025, following the previous years’ growth of 4.4%. The sector is expected to experience an annual decline in 2026 of 2.9% amid the uncertainty around the US tariffs and the subsequent supply chain disruptions and rising construction material costs. As the largest supplier of steel and aluminium to the US, the 50% tariff on Canadian steel and aluminium exports – enacted
in early June 2025 – will have significant impact on businesses and reduce their investment capacity and margins. According to the Bank of Canada, the ongoing US-Canada tariff war is likely to impact farmers in the Prairies who are greatly reliant on US phosphate and US equipment and machinery. This could lead to a phosphate deficiency in Canada, reducing crop yields and have knock-on effect that could lower production for Canadian agricultural-based industries. With China’s 100% tariff on Canadian canola oil, pea and oil cakes, as well as a 25% tariff on Canadian aquatic product and pork, this will impact sector investment and limit expansion. The national industrial vacancy rate surged to 4.8% in 2024, according to the Canadian Real
Estate Association (CREA), compared with 3.2% in 2023, with vacancy rates exceeding over 6% in Montreal and Calgary. This increase can be linked to rapid expansion due to expected growth of e-commerce that failed amid ongoing challenges. This may dampen investor confidence and lead to less industrial construction spaces built over the medium term. GlobalData forecasts that the industrial construction sector will grow at an annual average growth rate of 1.2% between 2027–29, supported by waste process and manufacturing investment. The sector will also be boosted by the country’s focus on reaching 100% zero-emission vehicle sales targets by 2035. Among the major construction projects tracked by GlobalData in the automobile sector is the construction of a
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