Vancouver Office Market Report
Metro Vancouver remained one of the tightest office markets in North America at mid-2024 and looks to be stabilizing in terms of vacancy and availability as new supply fades and absorption rises. Class A buildings continued to benefit from tightening vacancy at mid-2024 due to the ongoing flight to quality with the majority of office leasing activity being captured in class A premises. Regional vacancy and availability rates are returning to pre-2017 levels, which are widely considered to be indicators of a healthy office market for both tenants and landlords. Tightening vacancy in Downtown Vancouver offset a slightly weakened suburban market that had started to record vacancy increases in 2023 but had stabilized in the first half of 2024. Vancouver’s office submarkets, the Broadway Corridor and the Periphery, remain challenged in terms of vacancy and elevated availability, particularly in class B/C properties. Absorption of more than 728k sf at mid-2024, led by Downtown (613k) and Burnaby (115k), has the region on track to achieve the second-most annual absorption since 2018. New construction remained largely at a standstill in Downtown Vancouver, which poses the risk of a potential shortage of class A space in the late 2020s given development timelines. Achievable office rents downtown are increasingly likely to play a larger role in determining when new construction kicks off as opposed to attempts to model vacancy/demand. Securing quality space will likely be a growing issue moving forward as tenants’ evolving needs remain unmet in the obsolete class B/C buildings that continue to populate the market.
