Investment volume in the sector is growing after a challenging few years. Leasing activity is also expected to pick up as indicators improve and there is greater fiscal and monetary certainty in the regional economy.
According to an Oct. 10 report from Avison Young, office investment volume totalled almost $685 million in the first half of 2024, compared to just $69 million in the second half of 2022, reaching its highest level in three years. The firm tracks deals in Metro Vancouver above the $5 million mark. “Even though it’s a shock double-digit vacancy rate, the fact that we’re seeing that office investment goes to show that we realize office space is still in need, still necessary and not going anywhere,” said Rogowski. “There are also good deals to be had.”
“There wasn’t a lot of movement,” said Thompson. “Vacancy went up a bit across the board, but all the pieces are now starting to line up for a recovery.”“It takes time for interest rate cuts to start showing up in the data,” she said, adding that some market participants are waiting for others to make a move before jumping in.
Notable lease transactions, meanwhile, include a lease extension by Vancouver Film School in Gastown, a sublease by Sanctuary AI in Mount Pleasant and a new lease by ILSC Education Group in the downtown core.