Dream Industrial REIT (DIR-UN-T) has acquired a prime 32-acre parcel of development land in one of the most coveted locations in the Greater Toronto Area - a site that currently serves as a parking lot for the 2.95-million-square-foot Stellantis auto manufacturing facility in suburban Brampton.

The parcel of land on the sprawling Stellantis property at 2000 Williams Parkway, at the corner of Torbram and North Park roads just north of Toronto itself, was placed on the market in 2024. It underwent a competitive bidding process before Dream emerged as the buyer.

Financial details have not been disclosed. 

“This sale exemplifies the growing demand for well-positioned industrial land and the importance of aligning real estate decisions with long-term business strategies,” Jeff Flemington, a principal with Avison Young, which brokered the transaction for Stellantis, said. 

Although additional details were not immediately available, Dream Industrial intends to use the property for future industrial development, a source told RENX.

Both Avison Young and Dream Industrial declined to provide further comment for this article.

Significant infill development potential

An announcement Tuesday from Avison Young called the transaction a “complex divestment project” which involved a number of stakeholders including Stellantis and Dream, the City of Brampton and numerous other parties.

“Avison Young was proud to facilitate this outcome for Stellantis, bringing together key experts to ensure a seamless process,” Sanjiv Chadha, also a principal at Avison Young, said in the announcement.

The property offers an opportunity for a significant infill development in an area already zoned for industrial and commercial types of uses, with a skilled workforce, and a sizable existing industrial and manufacturing base.

It is also near Hwy. 427 and the Airport Road north-south corridor, which offers access to a major nearby intermodal rail terminal.

The land became available due to a retooling of the Brampton Stellantis plant as the firm transitions some operations to produce electric vehicles and other new models. Stellantis announced a $3.6-billion plan to retool the Brampton and Windsor facilities in 2022. 

The retooling at Brampton began last year and continues into this year. When the facility reopens Stellantis will manufacture the Jeep Compass there, according to the company website.

The GTA West industrial market

Brampton is part of the GTA West subsector, and contains 105 million square feet of the GTA West’s 422 million square feet of industrial inventory. The availability rate in the GTA West has risen recently to 5.7 per cent - a nine-year high according to Avison Young’s Q3 2024 data - as the industrial market has normalized following several years of intense demand and growth.

Asking net rental rates dropped slightly to $18.12 in the quarter. That’s down 3.4 per cent year-over-year, but rents had risen 104 per cent in the previous three years.

About 5.1 million square feet of new space, comprising 18 buildings, was under construction in the GTA West.

About Dream Industrial

Dream Industrial REIT owns interests in, manages and operates a portfolio of 338 industrial assets (545 buildings) totalling approximately 71.9 million square feet of gross leasable area in key markets across Canada, Europe, and the U.S. as at Sept. 30, 2024.

The trust is a part of the Toronto-based Dream group of companies, which has a portfolio of assets under management valued at approximately $26 billion.