While national and global economic conditions burdened office markets across Canada, industrial markets advanced through 2014 and 2015 and continue to gain traction, according to a new Cushman & Wakefield report.

A New Era in Industrial Real Estate report points out that in 2015, occupiers of industrial property in Canada, including Calgary, absorbed 17.8 million square feet of space, making it one of the “hottest growth periods” in the sector’s history.

Meanwhile, vacancy plunged to 3.7 per cent in the Greater Toronto Area due to increased e-commerce-related demand for warehouse and distribution space.

“Industrial real estate has hit a new high,” said Stuart Barron, national director research, at Cushman & Wakefield. “You have to look before the financial crisis to see the kind of robust growth happening now across major Canadian markets.”

Low energy costs, a competitive Canadian dollar, low interest rates, growing U.S. demand, and the evolution of e-commerce are fueling market growth.

“What took me by surprise,” said Barron, “is that Calgary didn’t see a single quarter of negative absorption for two years ending in the four quarter of 2015. That’s remarkable considering the magnitude of the energy bust on the downtown office market, and speaks to the dynamics and resilience of industrial real estate.”

For 2016, Vancouver, Toronto, and Montreal are expected to experience tightening industrial markets, new developments, and upward pressure on rental rates.