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Long-Term Prospects Remain Sound, While Large-
Bay Supply Rebalances Market in the Short Run
Demand outlook holds positive despite recent cooling. Over the trailing 12-months ended in June, Vancouver’s industrial market saw its first yearlong period of negative net absorption since 2010. Restrictive interest rates are curbing business investment and consumer spending, causing a pullback in space demand. Some companies are even consolidating operations and not renewing leases, as asking rents – which are the highest among major Canadian metros – have grown nearly 50 per cent since the start of the health crisis. Paired with strong supply growth, Vancouver is seeing some balance return to its industrial market. That said, because borrowing costs are expected to trend down both domestically and globally, economic growth will likely gain momentum in 2025. With direct access to the Pacific Ocean, the metro is set to play a key role in servicing global trade, supporting long-term industrial demand prospects.