Greater Vancouver’s industrial real estate market reached its highest point since 2015 at the end of 2024, says a new report from Newmark.

The region’s industrial vacancy averaged 2.6%, says the reported authored by Andrew Petrozzi, Newmark’s head of Canadian research, which highlights a shifting market characterized by rising sublease availability and a recalibration in demand.

Despite the increase in vacancy, the region maintained positive annual absorption for the 14th consecutive year, albeit at a subdued rate of approximately 270,000 square feet—the lowest absorption level since 2011. The report attributes this slowdown to market adjustments following years of tight supply and rapid rental-rate growth.

Sublease space availability surged to 2.3 million sf, marking the highest level recorded since Newmark initiated research coverage in 2008. This increase in sublease availability suggests that tenants are reassessing their space needs amid economic uncertainty, providing an opportunity for those willing to commit as landlords seek to limit vacancy.

The report also notes that while industrial market activity had gained momentum toward the end of 2024, the looming threat of U.S. tariffs created uncertainty. However, Newmark anticipates that upon resolution of these trade concerns, demand will likely rebound.

Among submarkets, Maple Ridge-Pitt Meadows recorded the highest vacancy rate in the region at 7%, followed by Vancouver at 3.2% and the Fraser Valley at 3.1%. Richmond remained the tightest market with a vacancy rate of just 1%.

Industrial real estate sales activity in Greater Vancouver also showed signs of moderation, with total proceeds reaching approximately $1.1 billion in 2024 (excluding strata sales), the lowest total since 2019. Strata industrial sales, however, remained relatively stable, with $797 million in transaction volume, slightly exceeding 2023 levels.

While the increase in vacancy marks a departure from the extreme tightness of recent years, the report suggests the shift represents a recalibration rather than a fundamental downturn. As new supply remains controlled and leasing activity continues, Greater Vancouver’s industrial market is expected to stabilize in 2025.

Photo: Courtesy of Newmark