Industrial Overview Report / Spring 2021 Metro

Metro Vancouver’s industrial market Ongoing strong demand from ten- Rising tide of remains the tightest in North America ants in Metro Vancouver’s heavily as record-low vacancy and rapidly ap- space-constrained industrial market demand lifts all preciating rental rates drive sales and continued fuelling a rapid apprecia- leasing activity from owner-occupiers, tion in the region’s average industrial Metro Vancouver tenants and investors alike. Meanwhile, rental rate, pushing it to a record high developers continue to pursue new of $13.87 psf (the highest in Canada) industrial markets development in increasingly complex - up 3.3% from year-end 2020 and settings to keep up with demand. 5.3% from a year earlier. As rates have continued to rise, the rental rate dif- as regional vacancy Regional vacancy hovered at 0.9% in ferential between core and suburban the first quarter of 2021 (unchanged industrial markets has shrunk consid- from year-end 2020, which marked remains lowest in erably with Vancouver, Burnaby and the first time that industrial vacancy the North Shore still able to command had slipped to less than 1%). Other North America premium rates. The days of tenants Canadian cities such as Toronto (1%), moving further out from the core in Ottawa (1.3%) and Montreal (1.5%) search of lower industrial rental rates were also among the North American have largely ended due to the fact industrial markets with the lowest va- that much of the new development is cancy rates in the first quarter of 2021. located in the suburbs, which are fre- Industrial vacancy in Calgary (7.5%) and quently the only areas with land left to Edmonton (6.9%) remained elevated in comparison. continued on back page

Metro Vancouver’s industrial Strata development represents one- Rental-rate escalation expected to continue vacancy lowest in North America third of total square footage of new as region appears unable to build meaningful at 0.9% supply currently under construction amounts of supply in the current environment

Delivery of new space for lease Lease rates hit new record high as Investment in industrial properties continues unable to alleivate chronically tight Metro Vancouver average achieves to rise as the asset class outperforms other vacancy as majority is preleased $13.87 psf commercial real estate asset classes and remains through 2021/22 the focus of investors of all types

Partnership. Performance avisonyoung.com Metro Vancouver Industrial Market Update (Q1 2021)

Average Asking Lease Rates in Metro Vancouver (PSF)

MARINE DR Approximately, 1.3 million

MARINE DR sf of new inventory will be 3 ST W MT SEYMOUR PKWY NORTHKEITH RDVANCOUVER E 3 ST$18.89 E DOLLARTON HWY delivered in the next six

W GEORGIA ST COAST MERIDIAN RD MERIDIAN COAST BARNET HWY months, but 82% of that space

E HASTINGS ST ST RENFREW

WILLINGDON AVE HASTINGS ST

CLARK DR CLARK PINETREE WAY ST JOHNS ST

MCNEIL RD NEAVESRD LOUGHEED HWY is already preleased/presold. W 4 AVE CLARKE RD W COMO LAKE AVE

KINGSWAY NANAIMO ST E BROADWAY W 16 AVE ST RUPERT GAGLARDI WAY PORT COQUITLAM

SW MARINE DR W KING EDWARD AVE LOUGHEED HWY AUSTIN AVE BOUNDARY RD KNIGHT ST $14.75 MAPLE RIDGE/

S

E COLUMBIA ST COQUITLAM BURNABY S A ABERNETHY WAY W 41Vancouver AVE W 41 AVE P CANADA WAY Pitt meadows B Y ILL $14.98 H $14.61 M RY $17.86 W 49 AVE A MCBRIDE BLVD $14.09 MUNICIPALITY INVENTORY Q1 VACANCY IMPERIAL ST DEWDNEY TRUNK RD DEWDNEY TRUNK RD NEW WESTMINSTER LOUGHEED HWY SE MARINE DR TENTH AVE

KNIGHT ST EIGHTH AVE

N/A 240 ST 272 ST MARINE WAY Richmond 38,556,876 0.6% GROSVENOR RD

BYRNE RD BRIDGEPORT RD KING GEORGE BLVD NO 6 RD 104 AVE 104 AVE Surrey 35,567,701 0.3% 120 ST 156 ST 152 ST 96 AVE ALDE