Rental, leasing and property management industries lose momentum in 2020 due to the pandemic
In March 2020, a series of unprecedented government measures related to the COVID-19 pandemic were put in place at a national level. Residential and non-residential real estate lessors and real estate property managers were not spared.
In 2020, the operating revenues of these industries rose 1.0% from 2019 to $120.5 billion, ending seven years of sustained average growth of over 5.0% per year. Despite the pandemic and a sharp decline in international immigration and the number of students in need of housing, this sector continued to benefit from modest population increases in 2020 (+1.2%) and from growth in the industrial sector, fuelled by e-commerce demand for logistics centres.
In addition, although workers deserted city centres and office buildings, most tenants—usually bound by long-term leases—opted to sublet to reduce costs. However, that was not enough to offset the weakness observed in the commercial sector. The largest repercussions were observed in Toronto. Nevertheless, the rollout of various assistance programs—including the Canada Emergency Commercial Rent Assistance, which covered 75% of rent for eligible businesses—helped to mitigate the difficulties experienced by the non-residential sector.
Residential and non-residential real estate lessors and real estate property managers reported operating expenses of $78.3 billion in 2020, up 0.7% compared with 2019. The operating profit margin was virtually unchanged in 2020 (35.0%) compared with 2019 (34.9%).
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