According to commercial real estate brokerage JLL, office market activity in Metro Vancouver in Q2 2024 was “relatively muted,” with “limited leasing activity” and “lack of deal velocity.”

The second quarter saw negative 25,345 sq. ft of absorption, primarily as the result of weak absorption in suburban markets, which are now at negative 88,920 sq. ft on the year, said JLL in their Q2 office market report.

“Absorption in the suburbs has been negative for six consecutive quarters, a clear contrast to the continued demand in downtown and periphery nodes,” said JLL. “While absorption remains stronger in the core submarkets, they have not experienced any significant uptick outside of new construction yet this year.”

JLL has the overall office vacancy at 10.2%, in line with Cushman & Wakefield’s 10.3%, who also noted that this continues to be the lowest vacancy rate among major markets in North America with inventory greater than 69 million sq. ft., “showcasing the resiliency of the Metro Vancouver office market and defying the national trend.”

Both firms view this as a tenants’ market and note that subleasing activity continues to decline.

Over on the industrial side, transaction activity also remained slow, according to JLL.

“The Metro Vancouver industrial market has continued to experience growth in vacancy and availability rates, increasing 70 bps and 40 bps, respectively,” said JLL, who has those rates at 3.1% and 4.4%, respectively.

Absorption continues to be negative for the year, with negative 627,000 sq. ft of absorption in Q2 bringing the year-to-date total to negative 880,000 sq. ft., as a result of “a large movement of users opting to vacate existing properties,” said JLL in their Q2 industrial market report.

“Some occupiers, challenged by higher occupancy costs, interest rates, inflation and initial over-expansion, have made their leased space available for sublease,” added Cushman & Wakefield in their own Q2 industrial market report.

According to Cushman & Wakefield, Vancouver currently accounts for the highest amount of vacant sublet space, at 226,000 sq. ft, with Langley following at 185,000 sq. ft, then Delta at 158,000 sq. ft, and Surrey at 147,000 sq. ft.

Here are the top office/industrial side transactions, by price, that occurred in Q2, according to JLL, Cushman & Wakefield, as well as Lee & Associates.

Metro Vancouver’s Top Office and Industrial Transactions in Q2 2024 by Howard Chai | Storeys