Market reports for the third quarter of 2023 show that demand for industrial property such as warehouse and logistics centres is slowing, but the boost in availability is still not enough to catch up to typical vacancy rates of a few years ago.It’s getting easier for businesses to find industrial properties than it was two years ago, but demand is still relatively high in factory land in hot spots such as the Greater Toronto Area, Vancouver and Calgary.
The industrial market is still tight because more companies need space to handle growing e-commerce orders and deliveries, Prof. Clayton said.“The demand for this kind of industrial property started before COVID-19 and has continued – we all started staying home and ordering things online. A lot of the industrial space needed for this kind of an economy built because existing buildings are obsolete – the ceilings are too low or the technology inside is inadequate,” Prof. Clayton says.
“A lot of companies that have outgrown space in Vancouver and are in need of more are moving to Calgary,” says Russell Wills, Colliers Canada’s industrial research lead. Industrial developer David Owen says his firm is a seeing large demand for infill warehouse space – properties developed on unused or underutilized sites close to existing roads, transit, sewers and other infrastructure services.
“New construction starts were down nearly 80 per cent in the third quarter compared with the same period last year, and the supply that is getting built primarily consists of large bay facilities in suburban locations, catering to big-box distributors,” he says.
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