Vancouver Office Market Report
New Supply Hindering Fundamentals, but Several
Sizable Leases Signal a Recovery is Brewing
Demand continues to hold in the face of economic headwinds. Despite high inflation, rising interest rates, and a possible recession on the horizon, office demand remains elevated and is continuing to gain momentum. Throughout the first half of 2022, both the downtown and suburban markets experienced positive net absorption. This is highlighted by Microsoft adding more space to its existing lease at the CF Pacific Centre in downtown, plus the rumoured 400,000-square-foot expansion at the Vancouver B6 development. Additionally, Lululemon leased roughly 120,000 square feet in the downtown core, again emphasizing the strong office demand tailwinds in the Vancouver market. Strong leasing activity is keeping investment sentiment positive, as Vancouver is experiencing a return-to-office movement much faster then other major metros. Total office transactions in terms of dollar volume increased by 41 per cent year-over-year.