B.C. land deals are becoming scarce as buyers become more selective and less confident, according to Avison Young.

In the first half of 2023, total B.C. land sales dollar volume sank 87% year-over-year to $1.1 billion, the commercial real estate services firm reported.

Industrial, commercial and investment land sales declined 76%. Most deals involved land intended for industrial and mixed-use projects as office-development opportunities struggled. High office vacancy has prompted owners, investors and developers to contemplate conversions to other uses.

In the largest first-half ICI land deal, Toronto-based institutional investor GWL Realty Advisors purchased 1525 Robson Street in Vancouver for about $63 million from Vancouver-based Logan Faith Ltd. The deal spells more positive signs for the next six months, said Avison Young.

However, the company said heightened interest rates and cost pressures have reduced developer appetite. Investor confidence is expected to remain low until interest rates stabilize.