Toronto’s retail sector demonstrated remarkable stability in 2024, maintaining one of North America’s lowest availability rates at 2.0% while seeing moderate but steady rent growth, according to JLL’s Canadian Commercial Real Estate Outlook report.
This stability represents a significant win for the retail industry, especially considering the economic uncertainties that plagued other commercial real estate sectors. While office vacancies continue to hover above 18% and industrial inventory faces absorption challenges, retail has emerged as a bright spot in Toronto’s property landscape.
The JLL report highlights the importance of tourism to Toronto’s retail recovery: “Toronto visitor spending reached $8.8b in 2024, up 4% from 2023 and up 7% from 2019. This was driven mainly by Canadian tourists as well as visitors from the U.S. and U.K.”
This tourism rebound signals a return to normalcy that retailers have long awaited. For shopping center owners and retail brands that weathered the pandemic’s darkest days, this trend validates their decision to maintain their physical footprint rather than retreat from brick-and-mortar.
The city’s retail leasing environment has been particularly robust in major shopping centers, with significant activity in both dining and apparel categories. Notable openings included Shake Shack‘s debut at Yorkdale Shopping Centre, Arabica’s new location at the CF Toronto Eaton Centre, and Alo Yoga establishing a presence at Square One.
According to the report, “Major malls are seeing the most openings in the dining and apparel & accessories sectors,” a trend that reflects shifting consumer preferences toward experiential retail and premium offerings.
What makes this particularly encouraging is that these expansions are happening despite Toronto’s overall real GDP growth slowing to just 1.0% in 2024, down from 3.1% in 2023. This decoupling of retail performance from broader economic indicators suggests the sector has developed a resilience that was lacking in previous downturns.
The evolution of Toronto’s retail footprint is happening alongside significant infrastructure development. The expansion of transit options is creating new retail nodes that landlords and retailers can leverage to reach consumers more effectively. This infrastructure investment provides a long-term foundation for continued retail growth that extends beyond immediate market conditions.
For retailers considering expansion, the data points to a strategic opportunity. With approximately 34% of office workers continuing to work at least partially from home, retailers have an unprecedented chance to rebalance their portfolios between downtown flagship locations and neighborhood centers closer to where consumers actually spend their time.
The retail investment market saw more modest activity in 2024, with total transaction volume reaching $1.1 billion, down from $1.8 billion in 2023. However, this represents an opportunity rather than a warning sign. With fundamentals remaining strong and capital values moderating, strategic investors have a window to acquire quality assets at more favorable pricing than was possible during previous market peaks.
The report highlights an emerging trend of retail property repositioning, with owners exploring mixed-use redevelopment opportunities for aging retail assets. For forward-thinking owners, this represents perhaps the greatest opportunity of the current cycle – the chance to transform dated retail formats into modern, multi-purpose destinations that can drive both foot traffic and multiple revenue streams.
Food and beverage concepts remain the most active segment in Toronto’s retail leasing market, providing a template for success that other retail categories can study and adapt. The key insight is clear: consumers continue to crave experiences that cannot be replicated online, and retailers that can deliver these experiences will thrive regardless of broader economic conditions.
Looking ahead to 2025, the market is positioned to benefit from several major upcoming events, including the 2026 FIFA World Cup preparations. For retailers, property owners, and investors alike, this presents a unique opportunity to align expansion and renovation timelines with these guaranteed traffic drivers.
Perhaps most encouragingly, the bifurcation between successful and struggling retail assets continues to sharpen. This clarity allows stakeholders to make more confident investment decisions, focusing resources on high-performing assets and concepts while pivoting away from outdated formats.
Toronto’s retail landscape has not just recovered – it has evolved. Those who recognize this evolution and position themselves accordingly stand to capture significant market share as the sector continues its transformation. The JLL report makes it clear: for those willing to adapt, Toronto’s retail future looks exceptionally bright.
Dustin Fuhs is the Editor-in-Chief of 6ix Retail. He is the former Editor-in-Chief of Retail Insider, Canada’s most-read retail trade publication. He has over 20 years of experience in the retail, marketing, entertainment and hospitality industries, including with The Walt Disney Company, The Hockey Hall of Fame, Starbucks and Blockbuster.
Dustin was named as a RETHINK Retail Top Retail Expert in 2024 and 2025.