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Highlights of the fourth quarter office market report include:
The Metro Vancouver office market experienced a high level of change throughout 2009. The fourth quarter ended with a vacancy rate of 7.2 percent, a significant increase from the 2008 year-end vacancy rate of 4.6 percent. Nearly all of the negative absorption occurred in the first half of the year, when large companies such as SAP, Telus and Electronic Arts consolidated their offices. In addition, there were several large tenants who left the Metro Vancouver market altogether, including EBay and Nexon Publishing.
From an investment perspective, the Vancouver office market defied the forces impacting other property classes and other Canadian markets in 2009 by finishing the year with a record volume of sales. There were several sale transactions in the fourth quarter over the $10 million mark, including the sale of 777 West Broadway, which sold for $26 million as well as 900 Howe Street which sold at a 6.7 percent capitalization rate amounting to $29,550,000. The market continues to be typified by supply constraints and tightly-held portfolios.
This is an exciting time to be in Vancouver and the general mood amongst commercial real estate investors is cautious optimism. Transaction activity has increased considerably since the first half of 2009, and some indicators at year-end point to increasing values after a period of stabilization in 2009. While all components of the market have been affected, from consumers and retailers, to buyers and sellers, to lenders and borrowers, the market appears to have reached a range of stability.
Contact Shawna Rogowski at 604.692.1476 for more information.
  Q4-09 Office Market Report-E.pdf
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