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To our Investors and Partners,
We are pleased to share our Q2 2025 financial results. This quarter reflected continued macroeconomic uncertainty together with signs of market recalibration. At Crown’s Investor AGM this June, we highlighted a theme that remains central to our strategy and is increasingly relevant in today’s environment: certainty is a competitive advantage. As underwriting becomes more selective and execution risk rises, investors look to partners with real-time insight, integrated operations, and a consistent track record.
Market Outlook
While 2025 began with improving sentiment, the second quarter was shaped by tariff pressures, geopolitical volatility, and uneven capital markets. Rate cuts, once expected to unlock activity, have had limited near-term impact.
According to CBRE, national office construction remains at a 20-year low, with no new project starts in over a year. Sublease availability has declined for eight consecutive quarters, down more than 25% from its peak. In addition to stalled construction and the removal of obsolete inventory, another factor constraining functional supply is the growing share of private owners in the market. These groups often lack the track record, service capability, or amenity investment needed to meet tenant expectations. This further reinforces the certainty quotient associated with an institutional platform like Crown’s that can consistently deliver quality, experience, and execution.
Office Trends
In our core markets, continued return-to-office requirements are reinforcing tenant demand, especially in downtown cores and select suburban nodes. Toronto’s overall vacancy remains near 17%, with strength in GTA West. Ottawa recorded a second consecutive quarter of positive absorption, with CBD vacancy down to 13.3%. Across both markets, Crown’s focus on delivering move-in-ready space, flexible structuring, and professional management continues to attract steady tenant demand.
Q2 Highlights
Looking Ahead
Through CR IV LP, we continue to pursue targeted asset sales where market depth aligns with asset quality. In parallel, CR V LP is actively underwriting new acquisitions where pricing reflects market risk, not asset-level weakness. With disciplined execution and deep local knowledge, we believe this period of recalibration will set the foundation for outperformance as the cycle progresses.
We thank you for your continued partnership and welcome the opportunity to continue to discuss our outlook and pipeline for the remainder of 2025.
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