Vancouver Office & Industrial Market Statistics - 3rd Quarter 2021

Third-quarter statistics show Metro Vancouver’s office and industrial markets are quickly getting back to normal, with office leasing velocity up sharply, and warehouse markets going to even more extremes. Industrial and office landlords have fully returned to their bullish outlook making things more challenging for occupiers and tenants alike. Even though COVID related rules still exist within all workplaces, most businesses have some, if not all employees back in the office. Occupancy rates in many downtown office towers are reportedly nearing 50%.  As anticipated, the amount of sublease space continues to fall, almost returning to levels seen at the onset of the pandemic. While difficult to imagine, conditions became even worse for warehouse users, with third quarter statistics showing Vancouver’s industrial market effectively out of space. At quarter-end, vacancies across the region neared a record half a percent (0.6%). The lowest of any major market in North America.

The Metro Area office availability rate dropped half a percentage point during the quarter, finishing at 9.3%, compared to 9.8% in Q2, and 8.0% a year ago. Across the region, downtown markets saw the biggest decline in available space, dropping by almost 340,000 square feet, followed by the Broadway Corridor (and surrounding submarkets) falling by 46,000 square feet, while suburban markets saw a slight increase, rising by 147,000 square feet. At quarter-end, downtown availability was 9.0%, suburban markets 9.3%, and Vancouver City (including Broadway Corridor) 10.3%. While largely an allusion, Metro Vancouver's industrial market posted a very modest increase in availability, rising by an almost undiscernible 10 basis points to 1.1%. During the quarter, both office and industrial rents moved higher with region-wide Class A office lease rates increasing by 1.6%, while industrial rents increased by $0.71 per square foot, or 4.5%.