It was a record-breaking year for Metro Vancouver’s commercial real estate market. According to the Colliers International’s Metro Vancouver Investment Report, which tallied the first six months of transactions, deals totaled $4.28 billion across 819 transactions, a major increase from 2015. So what drove these high numbers? We can look to three major sectors:
Thanks to the sales of Bentall Centre, the Royal Centre, and the United Kingdom building, office sales experienced the highest increase amongst all other sectors compared to 2015. The city’s growing technology industry is also said to spur the demand, as more companies are opting for Vancouver over Silicon Valley and need innovative workspaces that attract top talent. Even with the additional two million square feet of office space added over the past 18 months, Vancouver’s vacancy has fallen to the second lowest in Canada at 6.9%.
Called one of “the hottest stories of 2016” by The Vancouver Sun, the industrial market represented nearly 20% of total commercial real estate transactions over the first half of 2016, totaling nearly $756 million. Vacancy rates remain the lowest in Canada at just 1.4%, fuelled by demand by the film industry and tech sector. An interesting development to watch is the Strathcona Village project, which is the first to mix industrial with residential, developed by Wall Financial.
Retail investment in Metro Vancouver reached $1.1 billion, which is nearly double the amount from the same period in 2015. The most notable new addition is Canada’s largest indoor shopping mall, Tsawwassen Mills by Ivanhoe Cambridge. Yet despite such growth, Business in Vancouver reports that Metro Vancouver remains under-supplied with retail compared to the rest of the country.
With low vacancies and high demand, experts predict that 2017 will only see more record-setting numbers over the next twelve months. Do you agree? We’d like to hear what you think, tweet us at @naiopvancouver and let us know!