The real estate firm says that Vancouver now has the lowest industrial vacancy rate in North America at just 2.7 per cent, down from the previous record low of 3.6 per cent.
“We are facing an extreme supply crunch that will have serious consequences for the future growth of business in BC,” says Chris MacCauley, Senior VP at CBRE in Vancouver. “If more industrial land is not made available for development, it will stifle the economic growth of our province. It will prevent existing companies from growing and there won’t be room for new entrants into the market.”
He added that the vacancy rate is expected to fall further in the second half of 2017 with demand for industrial space 2.5 times the supply.
Large properties are in particular short supply with just one existing building in metro Vancouver at over 100,000 sq. ft. which has forced businesses to look to Delta and Surrey.
“We often hear the suggestion that simply building multi-level warehousing is the solution to the problem of Vancouver’s lack of industrial supply,” McCauley says. “However, what most commentators don’t realize is multilevel warehousing is only feasible for a very small segment of industrial users. Building up is not going to solve our problem, we need to think bigger.”
More market update:
Industrial land is in such short supply that it will run out by 2020 according to a new report from CBRE.