STRONG ECONOMY DRIVEN BY FINANCIAL INSTITUTIONS AND TECHNOLOGY Toronto is Canada’s largest city, as well as the country’s financial and technology hub. It is home to 40% of Canada’s head offices, representing 20% of Canada’s total GDP, making it the largest Data Centre market in Canada. In 2017 the World Economic Forum ranked Toronto as the eighth most high- tech city in the world. This is due in part to the tech boom that Toronto has experienced over that last few years, driven by labour availability and strong investment. Continuing to attract top talent has been key to the city’s success. Investment in Toronto based companies has been strong, receiving $611 million in investment in the first half of 2018, according to PwC’s Money Tree Report. Technology has also been a driving force for Toronto’s commercial real estate market. Tech giants like Shopify and Microsoft have expanded their footprints in the city. Vacancy rates across all sectors of Toronto’s real estate market have been very low, leading to Toronto and other key economic centres finding a way to balance strong growth, and demand for skilled labour. DEMAND Historically, Toronto has been an undersupplied market. New builds and site expansions in the last three years have greatly increased the amount of Data Centre space available. Beginning at the end of 2017 and continuing through the first half of 2018, the Toronto market has seen strong absorption. Much Canadian DATA CENTRE INSIGHTS A CUSHMAN & WAKEFIELD CANADIAN DATA CENTRE REPORT Toronto Data Centre Market Overview of this absorption has been retail deals, however there is also robust wholesale demand. Hyperscale’s initial entrance into Canada in 2016, has allowed providers readiness to expand their footprints or enter new Canadian markets. With two international wholesale providers entering the market in recent years, Toronto is now better equipped to handle the long-term growth and scale that has been seen in other major American Data Centre cities, Chicago and Dallas. This increase in supply from expansion and new entrants, has triggered downward pressure on pricing, consistent with the global trend driven by increased competition. Additionally, Toronto’s large and growing population, attracts demand from Cloud, SaaS and other media services, as well as the booming tech sector with growing demand that needs to be met.