Commercial real estate in Vancouver still has healthy fundamentals and positive momentum, despite the Canadian economy facing uncertainty around tariffs and Canada-US-Mexico trade negotiations.

That’s according to a new regional outlook by CBRE Ltd., which said different asset classes in key markets like Vancouver have long-term promise despite uneven short-term dynamics.

Office inventory in Vancouver is expected to remain stable for the foreseeable future, said the Feb. 3 report. That’s because there is no significant new supply being added downtown and planned projects are currently paused.

There is “robust” underlying demand for Vancouver office space, with leasing activity doubling year-over-year, said the report.

“This combination of a halt in construction and ratcheting demand is forecasted to see vacancy drop as existing supply is absorbed throughout the upcoming year,” said the report.

Industrial real estate, meanwhile, is set to recover after the oversupply of recent years, said CBRE. This is being driven by large-format leasing, with major deals currently in progress for spaces exceeding 100,000 square feet.

Large-format industrial supply could be cut in half by mid-2026, with inventory expected to be absorbed and vacancy rates expected to come down, the report said.

The region’s retail sector is entering a “pivotal” period with significant new supply being added through mixed-use projects like Oakridge Park in Vancouver and City Centre 4 in Surrey, said the report.

Despite resilient consumer spending and tight vacancy in most categories, these large-scale deliveries could impact inventory and rental rates. Regional malls are another area of concern, with uncertainty around the future of former Hudson’s Bay Co. spaces.

The multi-family market is seeing peak supply, with purpose-built rental starts up over 60% between 2021 and 2025 compared with the previous five-year period, said CBRE’s report.

Driven by housing starts and condo conversions, the new stock could cause vacancy to fluctuate but is expected to be absorbed by renters, resulting in stabilization and a return to long-term vacancy norms, said the report.

Canada’s safe-haven status supports future success, said the CBRE report.

One expert at another commercial real estate firm echoed this sentiment in a December interview with BIV.

“I’m seeing optimism that I think we haven’t felt in quite a while, and really it’s just a vote of confidence in Vancouver and how it continues to just be a very stable, safe investment,” said Shawna Rogowski, leader of Avison Young (Canada) Inc.’s market intelligence team in Vancouver.

She said the picture in Vancouver is improving after a challenging 2025.

“We’re definitely seeing a more positive outlook than I think most people were feeling six months ago, which is a great sign for us,” she said.

“Vancouver has always remained so resilient in the face of so many challenges that the rest of Canada and the other real estate markets might face.”

Rogowski singled out the strength of the region’s industrial real estate amid US tariffs, saying Vancouver is a very tight market because the city is geographically constrained and remains an important trade and logistics gateway.

Vancouver Commercial Real Estate Outlook Brightens After Uneven 2025 by Jami Makan | BIV