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Burnaby's industrial real estate market on the rebound
It appears the industrial real estate market in Burnaby is bouncing back from the economic downturn, according to recent figures from Avison Young.
In 2010, more than $100 million worth of industrial properties was sold in the city, surpassing that dollar figure for the first time since 2006.
Last year, $100.6 million in such properties was sold through 41 transactions, compared with $83.7 million in 38 transactions in 2009, when the global economy was still reeling from the financial crisis.
“It’s definitely optimistic and positive,” said Kyle Blythe, an industrial sales and leasing associate for Avison Young specializing in the Burnaby market.
“There’s an increasing amount of confidence in the industrial market and companies are now willing to look at relocating and potentially thinking of more space than they currently occupy.”
Industrial space includes properties used for warehousing, manufacturing and distribution.
From late 2008 and all of 2009, the economic uncertainty caused many companies to be reluctant to move, choosing to renew leases instead. There was also a jump in space being subleased, Blythe added.
Now, more companies are looking to not only lease more space but are exploring options to buy properties.
At 2.8 per cent, Burnaby also has the lowest vacancy rate in Metro Vancouver among municipalities with more than 10 million square feet of industrial space. The rate is up from about 1.3 per cent in 2006, but that’s largely due to the volume of new construction in the city, Blythe said.
Amacon’s New Haven Business Park, on the former site of New Haven Correctional Centre in the Big Bend, added about 161,000 square feet last year alone, he noted. That property is almost fully leased and is only the first phase in a three-phase project that will eventually total 450,000 square feet.
The Beedie Group also added 90,000 square feet of strata industrial space on North Fraser Way.
The quality space available, combined with Burnaby’s central location in relation to the highway, airport and port, all help keep the vacancy rate low, he said.
The activity in the past year is evidence to him of an increasing confidence in the economy.
“People are more receptive to having a real estate agent phoning them,” he added with a laugh.