Canada’s real estate market remains deeply challenged: Although 2026 isn’t expected to deliver a rapid rebound, there is growing recognition that the next cycle will not mirror the last. Instead, the industry is entering a generational transition that demands new strategies, partners, and capital sources, as well as a fundamental modernization of how companies operate. A record-breaking crowd of more than 500 real estate leaders heard the “balanced but cautiously optimistic” 2026 outlook at the 21st Annual “ULI Toronto Trends in Real Estate” event at the Fairmont Royal York hotel.

Data center demand is exploding as AI and always‑on digital life fuel the sector, which is far outpacing the broader commercial real estate market. Yet a lack of power-adjacent land and increasingly complex approval processes are now slowing projects and threatening to put a ceiling on that growth.

Data centers have a reputation for high energy use. EcoDataCenter 1 in Falun, Sweden, offers an alternate model: its two data centers, DCA and DCB, derive all of their power from nearby renewable energy sources; 75 percent comes from hydropower and 25 percent from wind.

The exponential growth in data creation and a significant shift toward cloud computing in recent years have driven soaring demand for data centers. Although artificial intelligence (AI) is frequently cited as the primary driver of the surge in demand for these facilities and their construction, JLL’s latest North America Data Center Report reveals a more nuanced reality. The report provides a comprehensive overview of the current market, challenges that the sector faces, and forecasts for the future of the booming data center industry.

According to CBRE’s “North America Data Center Trends H2 2024" report, the overall vacancy rate in primary markets fell to a record-low 1.9 percent at year-end. Only a handful of facilities with 10 MW or more are slated for delivery in 2025 and are not yet leased, reflecting the scarcity of large-scale available inventory.

Released during the Institute’s 2024 Fall Meeting in Las Vegas, Emerging Trends in Real Estate® North America predicts Dallas-Fort Worth, Miami as leaders in 2025

Developers and hyperscalers apply myriad solutions to meet climate goals