2022 Canadian CMBS Market Outlook

In 2021, the Canadian CMBS market finished the year with only one transaction closed despite the performance of the outstanding loans remaining stable. DBRS Morningstar expects the Canadian CMBS volume in 2022 to remain low because of rising interest rate that may affect demand in CMBS as well as the lingering Coronavirus Disease (COVID-19) pandemic impact. Concern for the retail and hotel asset types is expected to continue into 2022 with increasing caution in the office market, as growing uncertainty for the future of the workplace will likely shift the demand for office space. Geographically, Alberta (specifically Calgary) remains the most challenging market because of the province’s heavy reliance on the weakened oil and gas industry. DBRS Morningstar will continue to closely monitor the development of these submarkets.