- Canadian commercial real estate is in an active investor’s market because of weak business sentiment
- BTB REIT is a specialist in the sector with a profitable capital allocation track record to prove it
- Shares look underpriced and positioned for a potential re-rating
With the Bank of Canada cutting its policy interest rate in half from 5 per cent in April 2024 to 2.5 per cent in September 2025, capital has been stepping off the sidelines, taking advantage of falling mortgage rates and turning the real estate market around.
Canadian housing sales rose for the fifth straight month in August, with the Canadian Real Estate Association registering 40,714 purchases, the highest level for the month since 2021.
The trend has a runway to continue climbing, considering that Canada’s economy is expected to accelerate growth into 2026, fostering consumer sentiment and higher wages, and home prices are trending lower, giving back about 3.5 per cent year-over-year.
Enthusiasm in the housing market, however, has yet to reach the commercial real estate sector, where trade tensions with the U.S. and the persistence of post-COVID work-from-home mandates are tempering the appetite for risk, depressing valuations and causing a flight to quality to weather the storm.
This particular set of circumstances favors proven capital allocators in the Canadian commercial real estate space to find bargains, foster shareholder value and add operational leverage above expected economic growth.
A stock primed to put this thesis in play is BTB Real Estate Investment Trust, market capitalization C$331.01 million, which currently owns and manages 73 industrial, suburban office and necessity-based retail properties across Canada spanning about 6.1 million square feet.
This content has been prepared as part of a partnership with BTB Real Estate Investment Trust, and is intended for informational purposes only.
Anchored by more than 90 per cent occupancy and a tier-1 client base, including the Federal and Quebec governments, Walmart, Bristol Myers Squibb, WSP and Desjardins, BTB practices an acquisition philosophy centred on primary markets, clients’ reputation, redevelopment potential and a long-term mindset.
Management’s eye for quality has led the company to grow revenue from C$93.25 million in 2020 to C$130.03 million in 2024, with a healthy C$65 million earned through Q1 and Q2 2025, while earning stable net income despite inflationary headwinds, averaging just under C$40 million per year from 2021 to 2024, plus C$13.8 million collected in 2025.
Despite BTB’s proven profitability and stable C$0.025 monthly distribution, the company’s market capitalization is about C$140 million below the C$470 million we get by subtracting total debt (C$726 million) from total property value (C$1.2 billion), creating a more than 40 per cent margin of safety for an investment at the C$3.75 share price as of September 25.
Under the care of a leadership team with wholistic commercial real estate expertise, spanning acquisitions, asset management, development, property management, lease administration, and asset and corporate financing, BTB makes a strong case for being a prospective place to park your money – and get paid to wait – as continued profitability and potential economic growth help market perception catch up to intrinsic value.
Shares of BTB REIT (TSX:BTB.UN) have added 3.89 per cent year-over-year and 35.02 per cent since 2020.
The company will pay out its next monthly distribution to unitholders of record as of September 30, 2025.
Join the discussion: Find out what investors are saying about this real estate investment trust on the BTB REIT Bullboard and make sure to explore the rest of Stockhouse’s stock forums and message boards.
Stockhouse does not provide investment advice or recommendations. All investment decisions should be made based on your own research and consultation with a registered investment professional. The issuer is solely responsible for the accuracy of the information contained herein.
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