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What’s Ahead for Winnipeg Commercial Real Estate in 2026
January 15, 2026 4 Minute Read
Winnipeg saw signs of life returning to its office market in the back half of 2025, though downtown vacancy continues to climb, ending the year at 18.6%. Winnipeg’s suburbs are also dealing with elevated office vacancy.
And while the Winnipeg industrial market has maintained strong fundamentals, it faces headwinds and increased availability.
What does 2026 have in store for Winnipeg commercial real estate? We checked in with CBRE Winnipeg Managing Director Paul Kornelsen to find out what he’ll be watching for in the year ahead.
Industrial Remains Steady
If we are looking for a headline for 2026 I think it will be: Pretty Steady. 2025 was a solid year for the industrial market and we anticipate more of the same this year. The industrial market is healthy, with vacancy in the 3.5% range. Construction costs are high, which is limiting supply of new inventory. We continue to have a market where there is some new product sitting and then you have the functionally obsolete stuff. Everything in the middle is not readily available and when it is, it gets snapped up quickly.
So the trend would be that the newer industrial product that commands higher rents is sitting vacant longer. Winnipeg was underbuilt up until 2020, then it picked up momentum with spec builds and the new generation product the market had been screaming for. The pace of that development has now tapered. There are only a few buildings in the current development pipeline and under construction, but that’s enough to impact the supply side in 2026. There is just not a lot of availability and inventory out there.
Retail Performs Well
Retail just hums along as consumer spending remains stable. Construction costs are affecting retail development. We’re not seeing large-scale retail developments, only a few pad sites adding buildings smaller than 10,000 sq. ft. That means that new entrants have a difficult time getting into Winnipeg’s major retail nodes.
The aftermath of the Hudson’s Bay closure will be interesting to watch. I believe it accounted for 2% of Winnipeg’s entire retail footprint. But it’s nothing we haven’t managed before with Sears or Target. And the Bay locations were in enclosed malls, so those landlords have experience repositioning and finding creative uses for large blocks of space.
Another big story is that Costco just opened up their Westport site. We now have four locations and there’s a lot of noise in the north about a fifth one. That just speaks to the demand for Costco in Winnipeg; we could easily support another one or two based on how busy the other ones are. The one that opened in Westport will change that municipality and bring attention to that site in a way that no other retailer can.
Office Is Uncertain
We’re coming off an interesting year as we saw office leasing pick up for the first time in five years. It didn’t result in any groundbreaking transactions but there was a sense of optimism. There have been a couple of moves to Class A towers and there is a continuing flight to quality, with Class A buildings continuing to attract tenants and tenants moving from B and C buildings up to As.
I’m also seeing what I call a flight to connectivity. Businesses want to be connected to the Skywalk because Winnipeg weather can be challenging for six months of the year. Buildings connected to the Skywalk will continue to perform well. The ones that aren’t face a bit of a challenge.
We’re not seeing a lot in terms of office conversions here; one building is slated to be converted to a hotel on Broadway, but that’s the extent of it.
Multifamily Stays Strong
Multifamily continues to have strong fundamentals and demand. A lot of the properties are sold before they even get to market. Development has continued, particularly in the south, where most of the residential development is happening. All new neighbourhoods in Winnipeg have a multifamily component that they didn’t have 15 or 20 years ago.
And then there’s the Portage Place redevelopment. The wrecking balls have gone in. So I’ll be keeping an eye on that project this year.
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