The Greater Vancouver industrial market witnessed more noticeable signs of a slowdown in the first quarter of 2024 due to lower discretionary consumer spending, says a Colliers report.

The lower consumer spending resulting from economic headwinds mounting and higher inflation, asserted the commercial real estate services company.

Vacancy cracked the 2% barrier, albeit just barely, for the first time in seven years, standing at 2.1%. The market also recorded negative absorption not seen since the second quarter of 2024.

Vancouver’s industrial market began to slow down in 2023 after setting a frenetic pace in 2022 and 2022.

Headlease rates are likely to keep trending downward as sublease listings continue to comprise more than 25% of all vacancies and provide competitive offerings in the marketplace, says Colliers.

The net asking rent fell 3.4% year-over-year, while 7.5 million square feet of space was under construction and new supply totalled 874,000 sf.

Vancouver industrial vacancy metrics still rank among the best in North America, CBRE Chairman Paul Morassutti recently told Vancouver Real Estate Forum attendees.

A Colliers team led by Associate Research Director Susan Thompson authored the report.

Photo: Colliers