Howard Chai recently reported in the Globe and Mail on the number of "distressed" commercial real estate transactions that Canada has seen over the last few years:
2023: 119 transactions totalling $767 million
2024: 191 transactions totalling more than $1.5 billion
2025: 252 transactions totalling more than $1.42 billion
These numbers are from Altus Group and they, importantly, only include sales involving a court proceeding. They do not include properties sold at a loss because of financial distress or any other such scenarios. This means that the actual amount of "distress" in the market is certainly greater. We're all just holding on.
The hardest-hit asset class is, not surprisingly, development land. This makes sense because the value of development land is mostly binary right now. Either you can do something productive with it (in which case there's value) or you can't, and it's illiquid. Land is risky. It just doesn't seem that way when the market is hot.
The theme of the article is that the situation is likely to get worse before it gets better. Jeremiah Shamess of Colliers is cited as saying he thinks we will see the "emergence of a bottom" late this year or early into 2027. He must have read my annual predictions post in January, where I argued the same.
These periods of time always suck for everyone involved. But as is always the case in markets, the faster we deal with the pain, the faster we'll get to the other side. Failure is an essential part of capitalism. As many have said: "Capitalism without bankruptcy is like Christianity without hell."
Cover photo by Damian Kravchuk on Unsplash
There is a school of thought that elevated rail is bad, or at least suboptimal, for cities. The thinking is that it's a visual blight, it's noisy, it disconnects neighbourhoods, and it can even reduce surrounding real estate values. Having a train passing directly in front of your window is admittedly less ideal than not having a train passing directly in front of your window.
But there is no shortage of examples from around the world where elevated rail does far more to benefit a community than detract from it. Tokyo is perhaps the obvious place to look. It is decidedly rail-oriented city with the majority of its network above ground and countless examples of active commercial spaces being tucked under and adjacent to elevated rail.
Here, for example, is a restaurant that I visited on my last trip and that was immediately adjacent to a track:
The Globe and Mail just published this article about Canada's real estate markets. It's behind a paywall, but if you're able to access it, you'll find 10 housing charts. The first is called "Winners and losers," and what it shows is the percentage change in CREA's home price index since February 2022 — which, in hindsight, was the top of the market. (I don't know what the end date is for this data, though.)
The first thing you'll see is that, very broadly, there's Southern Ontario and Greater Vancouver, and then the rest of Canada. Prices have fallen materially in Canada's most expensive markets, whereas in cities like Calgary, Saskatoon, and Moncton, nominal home prices are up by double-digit percentages. There isn't just one Canadian market.
The other thing I found interesting is the title "Winners and losers," because it reminded me of the great paradox of modern housing policy. And by this I mean: which cities are winning and which are losing? If you already own a home, then winning is positive price appreciation. But if you don't already own a home and you'd like to in the future, well then, falling home prices is winning — they've just become more affordable.
Not surprisingly, it's hard solving for two opposing kinds of winning.
Howard Chai recently reported in the Globe and Mail on the number of "distressed" commercial real estate transactions that Canada has seen over the last few years:
2023: 119 transactions totalling $767 million
2024: 191 transactions totalling more than $1.5 billion
2025: 252 transactions totalling more than $1.42 billion
These numbers are from Altus Group and they, importantly, only include sales involving a court proceeding. They do not include properties sold at a loss because of financial distress or any other such scenarios. This means that the actual amount of "distress" in the market is certainly greater. We're all just holding on.
The hardest-hit asset class is, not surprisingly, development land. This makes sense because the value of development land is mostly binary right now. Either you can do something productive with it (in which case there's value) or you can't, and it's illiquid. Land is risky. It just doesn't seem that way when the market is hot.
The theme of the article is that the situation is likely to get worse before it gets better. Jeremiah Shamess of Colliers is cited as saying he thinks we will see the "emergence of a bottom" late this year or early into 2027. He must have read my annual predictions post in January, where I argued the same.
These periods of time always suck for everyone involved. But as is always the case in markets, the faster we deal with the pain, the faster we'll get to the other side. Failure is an essential part of capitalism. As many have said: "Capitalism without bankruptcy is like Christianity without hell."
Cover photo by Damian Kravchuk on Unsplash
There is a school of thought that elevated rail is bad, or at least suboptimal, for cities. The thinking is that it's a visual blight, it's noisy, it disconnects neighbourhoods, and it can even reduce surrounding real estate values. Having a train passing directly in front of your window is admittedly less ideal than not having a train passing directly in front of your window.
But there is no shortage of examples from around the world where elevated rail does far more to benefit a community than detract from it. Tokyo is perhaps the obvious place to look. It is decidedly rail-oriented city with the majority of its network above ground and countless examples of active commercial spaces being tucked under and adjacent to elevated rail.
Here, for example, is a restaurant that I visited on my last trip and that was immediately adjacent to a track:
The Globe and Mail just published this article about Canada's real estate markets. It's behind a paywall, but if you're able to access it, you'll find 10 housing charts. The first is called "Winners and losers," and what it shows is the percentage change in CREA's home price index since February 2022 — which, in hindsight, was the top of the market. (I don't know what the end date is for this data, though.)
The first thing you'll see is that, very broadly, there's Southern Ontario and Greater Vancouver, and then the rest of Canada. Prices have fallen materially in Canada's most expensive markets, whereas in cities like Calgary, Saskatoon, and Moncton, nominal home prices are up by double-digit percentages. There isn't just one Canadian market.
The other thing I found interesting is the title "Winners and losers," because it reminded me of the great paradox of modern housing policy. And by this I mean: which cities are winning and which are losing? If you already own a home, then winning is positive price appreciation. But if you don't already own a home and you'd like to in the future, well then, falling home prices is winning — they've just become more affordable.
Not surprisingly, it's hard solving for two opposing kinds of winning.
But you don't have to travel all the way to Japan to find examples where elevated rail does little to detract from the urban experience. Here's Marine Drive station in Vancouver, integrated into a newish development:
And here's what the elevated guideway looks like as it heads toward the station:
The obvious advantage of elevated rail is that it's significantly cheaper than underground rail. According to global data collected by the Transit Costs Project at New York University, underground rail tends to be at least 2x the cost — often it's even more. Are the benefits worth this additional cost, and is it worth building less overall transit with the same capital budget?
Elevated rail is not without its drawbacks, but good design and urban sensibilities can help to mitigate many of them. As is the case with a lot of urban design, what matters most is how we treat the ground plane underneath the rail. So, to the extent that it remains out there, I think it's time we get rid of any stigmas associated with elevated rail. More transit is better than less transit.
Cover photo by Daiji Sasahara on Unsplash
But you don't have to travel all the way to Japan to find examples where elevated rail does little to detract from the urban experience. Here's Marine Drive station in Vancouver, integrated into a newish development:
And here's what the elevated guideway looks like as it heads toward the station:
The obvious advantage of elevated rail is that it's significantly cheaper than underground rail. According to global data collected by the Transit Costs Project at New York University, underground rail tends to be at least 2x the cost — often it's even more. Are the benefits worth this additional cost, and is it worth building less overall transit with the same capital budget?
Elevated rail is not without its drawbacks, but good design and urban sensibilities can help to mitigate many of them. As is the case with a lot of urban design, what matters most is how we treat the ground plane underneath the rail. So, to the extent that it remains out there, I think it's time we get rid of any stigmas associated with elevated rail. More transit is better than less transit.
Cover photo by Daiji Sasahara on Unsplash
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