Canada's U.S. real estate bid is outgrowing the trade war

Canadian investors sent 32% of the capital they raised for global acquisitions to the United States in the year through June, up from 19.3% for the rolling twelve months a quarter earlier. Their U.S. purchases over the same stretch hit $9 billion—still short of the five-year average but up from a $5 billion rolling average at the end of the prior quarter, according to Colliers' Global Capital Flows report, first reported by Bisnow. When a total and a share rise together, the read is deliberate reallocation rather than a quirk of the denominator; a share gain on a shrinking global budget would be the more fragile conclusion.

Colliers' own researcher explains the flow in local terms: "We are not an export industry. We don't build apartments to sell them to Japan," said Adam Jacobs, head of Canada research at Colliers. "Everything is local and more tied to local demographics and local job markets." Underwriting an American apartment building on that logic looks like underwriting a domestic one—a rent roll, an employment base, a supply pipeline—and none of those inputs prices a tariff.

Across their global investments in the period, Canadian firms put 32% of capital into multifamily, 27% into industrial and 18% into offices, while the four runners-up for outbound dollars—Japan, the U.K., Spain and Australia—together absorbed $4.9 billion, a hair less than the United States took from Canadian buyers on its own. Two 32s appear in the Colliers tables, and they measure different things—the U.S. share of capital raised and multifamily's slice of Canadian deployment abroad. Their agreement is coincidence. The apartment concentration is the substantive one.

The United States has long been the top destination for Canadian outbound real estate, and it is now winning against a wider field, taking $28.3 billion in the most recent period to lead the U.K. by $3.4 billion three months after the U.K. had nosed in front by $25 million. Jacobs credits depth and the sheer availability of product—"The U.S. is a very deep and diversified market," he said—and Colliers' research does travel; the shop's first-half Asia Pacific leasing numbers in August showed occupier demand narrowing to a three-market core and new supply dropping 37 percent, scale and choice being the common thread in both datasets.

A lag sits in these numbers—Colliers' data stops a couple of months short of the stretch in which the two countries traded fresh tariffs, so the second-quarter acceleration was booked before the escalation rather than after it. Jacobs does not expect the newer round to change much: "When we're talking about big investors with $50B looking at diversifying their portfolio or getting into an alternative asset, I don't think that because there's tariffs on molasses and motorcycles it is necessarily stopping those deals from happening," he said.

He is likely right, though the reason is narrower than the quote suggests. The report measures where the money went, not what would stop it; tariffs are the constraint this data touches obliquely, while the levers that would more plausibly interrupt a cross-border flow—the cost of debt on the asset, the currency conversion, the tax and foreign-investment-review treatment of an out-of-country buyer—get no treatment in these figures at all. That is the argument for reading the second quarter as a fundamentals move, and it is also the reason one quarter should not be trusted too far: a rolling twelve-month total that stays under its five-year average is a flow with room to be withdrawn.

Apartment buyers in this cycle are clearing trades on locations and lease-up ceilings rather than on a rent-growth forecast, and a third of Canada's global real estate deployment going into apartments fits that description closely: these are allocators underwriting a metro's jobs and demographics, the kind of capital that keeps writing checks through a tariff cycle, and construction is thinning across apartment markets, as noted in August, giving owners leverage. The Canadian bid is not yet big enough to set those prices, sitting below its own five-year average, but it is patient, cross-border and aimed at the asset class where supply is doing the work.

The next Colliers print will be the first to cover quarters in which the tariffs were actually in force, and it carries two markers: whether the U.S. share holds near a third, and whether the dollar total clears the five-year average it has sat under through June. A share that holds while the sum climbs settles the argument; a share that holds on a flat total says less about Canada's appetite for the United States than about how little capital its firms are putting to work anywhere.