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Market Report

Vancouver Office Market Report

2025 Investment Forecast

Interest Rate Declines and Adaptive
Reuse Projects Set to Drive Sector Stabilization

Conditions improve as demand and supply dynamics evolve. While the metro’s average vacancy rose in 2024, it was primarily driven by a rise in the suburbs amid weak office demand and elevated supply growth. In Burnaby, the completion of Gilmore Place Phase I along with two buildings of Discovery Campus added 400,000 square feet in the third quarter. Nevertheless, net absorption remained weak, as less than 60,000 square feet was occupied in the submarket during the same period. Looking ahead, however, a recovery is likely. Declining interest rates are expected to boost space demand in suburban markets and strengthen growth in the downtown core, where vacancy had already stabilized last year. This recovery will align with easing supply-side pressures, as a shrinking under-construction pipeline is set to further improve sector fundamentals. Additionally, many developers have also received permission to transform office spaces into other formats. Both Anthem Properties and Lark Group received approval last year to convert portions of their unfinished office projects into hotel use. This will help reduce office vacancy while also targeting sectors in greater need of new supply.
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