For the first time in four quarters Metro Vancouver’s office vacancy rate experienced an increase, growing 30 basis points (bps) quarter-over-quarter to 6.6%. Suburban markets continue to drive change, though through Q3 2022, new to market subleases from tenants no longer requiring the full extent of their space applied upwards pressure on vacancy rates and accounted for all negative net absorption through the region.
Vacancy rates in all classes of office inventory through Metro Vancouver experienced a quarter-over-quarter increase, with the exception of Class AAA which recorded a 10 bps decline. Recent listing activity has brought the total vacant sublease inventory up, while direct vacancy remained somewhat level.
Demand for quality office product within the downtown core continues to drive declines in the vacancy rate. Vacancy in Class AAA inventory has declined 110 bps to 4.6% and is the lowest of any downtown class. Looking forward, 81.8% of all space currently under construction within the downtown core is already pre-leased, driven by an estimated 150,000 sq. ft. of deal activity within the last quarter alone.