Rental, leasing and property management industries' operating revenue continued to grow in 2019

Released: 2021-03-19

In 2019, residential and non-residential real estate lessors and real estate property managers generated $119.4 billion in operating revenue, up 4.8% from 2018. This sector benefitted from a more rapid increase in the population in 2019 (+1.4%) for a second consecutive year and industrial sector growth fuelled by e-commerce demand for logistics centres. Low office vacancy rates in Vancouver and Toronto also contributed to growth in this sector.

These industries reported operating expenses of $77.7 billion, up 4.6% from the previous year. The operating profit margin was virtually unchanged in 2019 (34.9%) compared with 2018 (34.8%).

Lessors of non-residential buildings

The largest of the three industries, lessors of non-residential buildings, saw operating revenue increase 5.0% to $63.1 billion in 2019. Operating expenses rose 5.3% to $40.2 billion.

Among the provinces, British Columbia posted the largest increase for the third consecutive year, with operating revenue up 7.5% from 2018 to 2019. In addition, the province saw its economic growth reach 2.5% in 2019. British Columbia is the only province whose economic growth has been above 2.0% per year since 2010.

Alberta recorded a more moderate 1.1% gain in operating revenue in 2019. One of the factors underlying the modest growth in Alberta was the slowdown in the energy sector, which continued to limit demand for non-residential real estate. For example, the office vacancy rate in Calgary remained at a historically high level, rising from 24.3% in 2018 to 24.7% in 2019. Although the unemployment rate in Calgary decreased for a fourth consecutive year, it stood at 7.1% in 2019, compared with 5.0% in 2014.

Ontario had the largest share of rental income, at 42.5%, followed by Quebec (18.8%), British Columbia (16.3%) and Alberta (14.1%).

Lessors of residential buildings and dwellings

In 2019, lessors of residential buildings and dwellings reported a 4.7% increase in operating revenue to $48.6 billion.

Operating expenses for the industry rose 4.1% to $31.5 billion.

From 2018 to 2019, operating revenue grew 7.2% in British Columbia, driven by an increase in rents, which were up 4.2% on average in 2019. While the vacancy rate edged up (from 1.4% in 2018 to 1.5% in 2019), it remained low for a sixth consecutive year. Among provinces, Prince Edward Island, Nova Scotia and Ontario also posted notable growth, fuelled by strong net international migration.

Ontario (37.8%) had the largest share of residential rental income, followed by Quebec (25.9%), British Columbia (16.2%), and Alberta (10.9%).

Real estate property managers

The real estate property management industry generated $7.6 billion in operating revenue in 2019, up 3.4% from 2018. This industry also reported operating expenses of $6.0 billion, up 2.7% from the previous year.

The COVID-19 pandemic is changing the foundation of these industries

Although the residential and non-residential real estate rental and leasing and property management industries generally withstand economic shocks rather well, the COVID-19 pandemic nevertheless shook their foundations. Telework, e-commerce, higher vacancy rates for residential rental units and office space—mainly in major urban centres—and a sharp decline in immigration slowed the growth of these industries in 2020. While some factors are temporary, others are structural and will permanently change the industry.

Assistance programs that have helped reduce the adverse effect on the real estate rental and leasing and property management industries include the Canada Emergency Response Benefit, the Canada Emergency Student Benefit, the Canada Emergency Wage Subsidy, and the Canada Emergency Commercial Rent Assistance. Since these industries had to deal with many new factors and trends, the next annual survey will provide more detailed information on the impact of the COVID-19 pandemic.

Contact information

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