October 2025 brings a mixed but actionable setup for Canada’s commercial real estate market. While investors remain focused on rate movements, the real story lies in how the market is recalibrating its value drivers. Across sectors, the emphasis is shifting from passive yield to active repositioning, from static design to experience-led environments, and from tight liquidity to selectively open capital channels.

This month’s Briefcase filters the signal from the noise—linking you to credible market reads on inflation, policy, capital markets, and sector-level data, with practical insights for underwriting, pricing, and timing. Each article below includes a concise summary to guide where to dig deeper.

Executive Snapshot (Sep–Oct 2025)

A one-minute overview of the economic and market prints shaping decisions this month.

Inflation (StatsCan CPI – September 2025)

📈 The latest CPI print shows a modest deceleration in headline inflation, though core measures remain stubbornly high. Shelter and food continue to lead monthly gains, keeping the Bank of Canada cautious despite political pressure for rate relief. The data reinforces a “higher-for-longer” tone and suggests financing assumptions should remain conservative through Q4.

• Consumer Price Index, September 2025

Policy (Bank of Canada – October 29 Rate Decision + MPR)

💬 The Bank of Canada announced a 25-basis-point rate cut, bringing its overnight rate to 2.25% and the Bank Rate to 2.5%. Governor Tiff Macklem noted that while economic growth remains subdued—projected at 1.2% in 2025 and 1.1% in 2026—further cuts are unlikely in the near term. Inflation is expected to average around 2%, suggesting a pause phase rather than a cutting cycle.

For CRE players, the message is clear: financing conditions will ease slightly, but spreads, DSCR, and loan-to-value discipline still define deal feasibility. Rate stability now shifts focus back to asset quality, cash-flow resilience, and timing.
👉 BoC Press Release | Full Statement

Office (CBRE Q3 2025 Figures)

🏢 CBRE’s latest office report signals early signs of stabilization across major markets. While sublet space remains elevated, absorption is gradually improving—driven by tenant consolidation and renewed demand for amenity-rich, experience-driven offices. The “flight to quality” trend continues, emphasizing the importance of repositioning B assets in prime locations.
👉 View report

Industrial (CBRE + Altus Q3 2025 Reports)

🏭 The industrial sector remains a pillar of resilience, though the pace of growth is moderating. New completions are easing availability pressures, bringing balance to key logistics hubs. Altus notes a continued uptick in investment activity as investors seek stable, long-lease assets amid softer rent escalation forecasts.
👉 CBRE Industrial Figures
👉 Altus Industrial Update

Capital Markets (Altus Q3 2025 Investment Trends)

💰 Altus’ Q3 investment trends report shows that deal volumes are ticking upward as buyer-seller expectations start to realign. The Overall Cap Rate Index remains steady, suggesting cautious optimism as liquidity improves. However, capital remains disciplined—favoring well-located industrial, multifamily, and necessity-based retail assets.
👉 Read report

Housing Supply (CMHC September 2025)

🏗️ CMHC reports a modest rebound in September housing starts, led by multi-unit construction in major CMAs. Still, financing constraints and municipal approval bottlenecks continue to cap overall supply. With affordability programs under review, the data underscores the structural shortage facing both investors and renters.
👉 CMHC News Release
👉 Data Tables

Conversions (City of Calgary – Office-to-Res Incentives)

🏙️ Calgary’s downtown conversion program continues to lead by example, driving new residential supply through adaptive reuse. Recent project completions, like The Loft, demonstrate that design-led conversions can revitalize underused office stock and attract urban residents back downtown. The city’s incentive model is becoming a reference point for other urban cores exploring similar strategies.
👉 Program Page
👉 Explainer
👉 Example Update

Insights on Investment, Commercial Mortgages, and Market Pulse

Translate headlines into action. These reads help shape underwriting, structure capital stacks, and focus origination time where it converts.

Underwriting the Retrofit Wave (JLL)

♻️ JLL outlines a practical framework for repositioning aging assets through targeted retrofits. The report divides assets into “light,” “medium,” and “deep” intervention categories and quantifies how ESG upgrades and tenant experience improvements feed directly into NOI growth. For investors, this is the blueprint for turning obsolescence into alpha.
👉 Read full analysis

Design That Moves Leasing (JLL)

🎨 The next generation of leasing success hinges on experience-led and AI-enabled design. JLL’s research shows that occupiers increasingly prioritize social connection zones, intuitive wayfinding, and “street-to-seat” comfort over raw square footage. Developers who embed these principles into spec suites and TIs are winning faster lease-up and stronger retention.
👉 Explore trends

Debt and Equity Flow-Through (Marcus & Millichap)

💵 Marcus & Millichap’s October briefing suggests that credit markets are gradually thawing. Lenders are re-entering the space with tighter covenants and a renewed focus on DSCR and sponsor strength. Equity fundraising remains selective but more active, with investors favoring stabilized assets that can weather policy uncertainty.
👉 Read brief

Retail Strategy and Pricing (Marcus & Millichap STNL)

🛍️ The 2H25 Single-Tenant Net-Lease Report provides an instructive benchmark for Canadian investors tracking essential retail. Net-lease assets with strong credit and longer remaining terms continue to outperform, emphasizing the enduring appeal of defensive retail. For those underwriting neighborhood retail in Canada, these comps set a clear pricing framework.
👉 View report

Multifamily Reality Check (Missing Middle Initiative)

🏘️ The Rental Paradox report explores a growing disconnect: asking rents are easing slightly, yet access and quality remain constrained. As new supply skews toward higher-end units, affordability remains out of reach for many. Investors should build conservative lease-up timelines and realistic OPEX forecasts as policy reforms evolve slowly.
👉 Read article

Regional Watch-List (Informa Connect Q3 Real Insights)

📍 Informa Connect’s Q3 review highlights resilience in grocery-anchored retail and signs of stabilization in the office sector. Toronto and Ottawa continue to benefit from a return-to-office push and a disciplined lending environment. However, regulator focus and debt-service pressures mean only well-capitalized sponsors can execute at scale.
👉 Read summary

Latest Economic and Real Estate Insights (Macro → Sectors)

Start broad, then zoom into sectors. These reads help brief partners and support your investment thesis with data-backed reasoning.

Strategy and Design (JLL)

🧭 Repositioning is emerging as the dominant value-add strategy for the next cycle. JLL’s framework helps investors classify assets by retrofit intensity and quantify the CAPEX-to-NOI conversion path. ESG and regulatory compliance are no longer optional—they’re central to maintaining liquidity and valuation resilience.
👉 Repositioning Playbook

Experience-Led & AI Design (JLL)

🌐 The new office and retail design paradigm blends human-centered experience with AI-driven optimization. Think adaptive lighting, flexible space modules, and analytics that support tenant retention. These elements now translate directly into shorter lease-up periods and stronger rent roll stability.
👉 Design Outlook

Capital Markets (Altus, CBRE, Marcus & Millichap)

📊 Liquidity is returning gradually but selectively. Altus shows modest cap-rate expansion in secondary markets, while CBRE’s Q3 report reveals pricing discipline in prime assets. Marcus & Millichap projects a more fluid Q4 with tighter spreads and improved lender engagement, though underwriting remains scenario-based.
👉 Altus Investment Trends
👉 CBRE Cap Rate Insights
👉 Capital Markets Brief + 2026 Outlook

Housing and Rentals (Missing Middle Initiative)

🏠 Even as advertised rents soften, affordability remains elusive. The Missing Middle series explains why price corrections don’t equate to accessibility in supply-limited environments. For multifamily investors, this underscores the need for disciplined underwriting, diversified unit mixes, and clear alignment with policy programs like ACLP and HAF.
👉 The Rental Paradox
👉 A Symptom of Scarcity

Regional Focus (Toronto & Ottawa – Informa Connect)

🏙️ Local fundamentals remain intact despite macro headwinds. Toronto’s mixed-use retail holds steady thanks to resilient consumer demand, while Ottawa’s office recovery is bolstered by public-sector occupancy and renewed RTO mandates. Lender posture remains cautious, but refinancing pipelines are opening incrementally.
👉 Full Readout

Must-Reads (October 2025)

Your short list of credible reports to cite in IC memos and investor updates. Read these before you set assumptions.

• CBRE — Canada Office Figures Q3 2025: https://www.cbre.ca/insights/figures/canada-office-figures-q3-2025
  

• CBRE — Canada Industrial Figures Q3 2025: https://www.cbre.ca/insights/figures/canada-industrial-figures-q3-2025
  

• Altus Group — Canadian CRE Investment Trends Q3 2025: https://www.altusgroup.com/insights/canadian-cre-investment-trends/
  

• CMHC — Housing Starts September 2025: https://www.cmhc-schl.gc.ca/media-newsroom/news-releases/2025/housing-starts-september-2025
  

• City of Calgary — Downtown office-to-res program snapshot: https://www.calgary.ca/development/downtown-incentive.html
  

• Marcus & Millichap — Capital Markets Brief (Oct): https://www.marcusmillichap.com/research/research-brief/2025/10/research-brief-october-capital-markets?utm_source=mymmi&utm_medium=email&utm_campaign=research+digest
  

• Marcus & Millichap — 2H25 Single-Tenant Net-Lease Retail National Report: https://www.marcusmillichap.com/research/special-report/2025/10/2h25-single-tenant-net-lease-retail-national-report?utm_source=mymmi&utm_medium=email&utm_campaign=research+digest

• Marcus & Millichap — Research Brief: October 2026 Outlook:https://www.marcusmillichap.com/research/research-brief/2025/10/research-brief-october-2026-outlook?utm_source=mymmi&utm_medium=email&utm_campaign=research+digest
  

Final Takeaway

The next inflection for deal velocity is lender re-engagement and equity flow, while underwriting still depends on precise modeling of spreads and DSCR. Asset-level value creation will come from retrofit readiness and human-centered design, not just timing rate cuts. For multifamily and rental markets, pricing softens but fundamentals remain tight—making operational execution the true differentiator.

Treat every headline as an input, not an outcome: quote debt the same day, map retrofit returns beyond cap-rate moves, and prioritize durable income growth.

Abbreviations used in this Briefcase

Quick glossary for readers.

• ACLP — Apartment Construction Loan Program

• BoC — Bank of Canada

• CAPEX — Capital expenditures

• CMHC — Canada Mortgage and Housing Corporation

• CPI — Consumer Price Index

• CPs — Conditions precedent

• DSCR — Debt service coverage ratioICR — Interest coverage ratio

• DY — Debt yield

• ESG — Environmental, social and governance

• Exit cap — Capitalization rate used at sale

• GP — General partner

• HAF — Housing Accelerator Fund

• IC memo — Investment committee memo

• IO — Interest-only

• JV — Joint venture

• LC — Leasing commissions

• LP — Limited partner

• LTC — Loan to cost

• LTV — Loan to value

• MPR — Monetary Policy Report

• NOI — Net operating income

• OCR (Altus) — Overall Capitalization Rate

• OPEX — Operating expenses

• OSFI — Office of the Superintendent of Financial Institutions

• Overnight rate — BoC policy rate

• Pref — Preferred equity/return

• RTO — Return to office

• SAAR — Seasonally adjusted annual rate

• SNDA — Subordination, non-disturbance and attornment

• STNL — Single-tenant net lease

• TI — Tenant improvements

• VTB — Vendor take-back