Metro Vancouver Industrial Overview - Avison Young

Metro Vancouver

Industrial Overview Fall 2014

INSIDE: Q&A with Paul Tilbury, Greg Wilks, Jeff Miller, Michael Beattie and Murray DeGirolamo on the return of speculative industrial construction projects to the Metro Vancouver market.

> Metro Vancouver industrial market snapshot Market

Industrial Inventory

Vacancy

(square feet)

Fall 2014

Spring 2014

Fall 2013

Richmond

37,090,055

2.5%

3.6%

4.4%

Surrey

28,261,390

2.6%

2.9%

2.3%

Burnaby

27,637,584

4.0%

3.4%

4.3%

Vancouver

23,432,440

3.2%

2.5%

2.5%

Delta

21,822,754

7.0%

8.0%

7.1%

Langley

16,195,691

2.2%

2.8%

3.1%

Coquitlam

8,003,369

3.6%

2.8%

4.4%

Port Coquitlam

7,255,930

4.1%

5.1%

4.2%

Abbotsford

7,111,363

2.8%

4.6%

3.6%

North Vancouver

5,452,983

2.1%

2.3%

2.3%

New Westminster

3,776,194

6.5%

1.6%

3.1%

Maple Ridge/ Pitt Meadows

3,388,653

5.0%

3.0%

3.3%

189,428,406

3.6%

3.7%

3.9%

TOTAL

> Market Indicators (change from six months ago)

absorption

cap rates

rental rates

Strengthening demand driving speculative construction to new highs

S

ignificant speculative construction in multiple Metro Vancouver industrial markets has served notice to tenants, owners and investors that leasing activity, demand for industrial product and regional economic conditions have produced expansion and acquisition opportunities after years of indecision and measured growth expectations. This shift in outlook has come as the result of rising absorption rates triggered by the activation of oft-delayed expansion plans and an increase in Metro Vancouver’s typically limited supply of sale and lease options for industrial users seeking to expand or enter the market. Overall Metro Vancouver industrial vacancy tightened to 3.6% at fall 2014, down slightly from 3.9% 12 months earlier. This decline in vacancy occurred even as the total industrial inventory rose more than 3 million square feet (msf ) to 189.4 msf from 186.3 msf in fall 2013 – one of many recent examples of the strong demand for industrial space in the region. In the five largest industrial submarkets, vacancy tightened or remained unchanged compared with a year ago. Vacancy in Richmond, which declined to 2.5% from 4.4% a year earlier, recorded the largest drop in Metro Vancouver, which was primarily due to an active leasing market and a lack of substantial new product. Vacancy in Surrey rose slightly to 2.6% from 2.3% year-over-year as market activity included the delivery of more than 240,000 sf of new inventory and significant positive absorption. Burnaby, which recorded a slight decline in vacancy to 4% from 4.3%, remained very active with the addition of several new projects that did little to alleviate tightening vacancy. Vancouver proper, which recorded an increase in vacancy to 3.2% from 2.5%, remained constrained due to a lack continued on page 2

vacancy rate

construction

retail sales

container shipping volume

continued from page 1

of new product and continued demand for the existing, inefficient industrial properties that make up a significant proportion of the submarket’s supply. And despite the addition of more than 1 msf of new inventory, vacancy in Delta remained virtually unchanged at 7% compared with 7.1% a year ago. With the exception of New Westminster and Maple Ridge/Pitt Meadows, which both recorded spikes in vacancy due to a combination of the delivery of new product, lower absorption levels and vacancy in existing buildings, vacancy in the rest of Metro Vancouver’s industrial submarkets declined or remained stable compared with a year ago. This wave of absorption of leased industrial space in the past 12 to 18 months has in large part been driven by the difficulty many owner/users have had acquiring suitable industrial premises to purchase. While developing strata projects continues to be a winning formula for many of the region’s industrial developers, low interest rates, constrained land supply and a lack of alternative ownership options continues to fuel strata sales. Owner/ users also choose to lease in order to meet immediate expansion needs and to await an opportunity to acquire larger, more efficient premises or to remain flexible for

New industrial space – much of it built on a speculative basis – remains a hot commodity in Metro Vancouver, with Onni Group’s Golden Ears Business Park attracting tenants from throughout the region.

high-growth needs.

experienced in decades (see page 3).

The drive to acquire stand-alone assets has led many owner/users to meet increasing vendor expectations. Despite a willingness to meet these expectations (thanks in good part to low interest rates), the first half of 2014 recorded just $162.9 million in transactions (for trades greater than $5 million) – the lowest level of industrial investment since the first half of 2010 – due in large part to the lack of available quality industrial product in the market. Infrastructure investment and the projected growth in port traffic have instead produced one of the largest phases of speculative industrial construction that Metro Vancouver has

Industrial leasing activity in Metro Vancouver has gone through three distinct phases since mid-2013, which has led to the conditions currently defining the market. First, large-bay transactions (20,000 sf to 50,000 sf+) that closed 12 to 18 months ago absorbed some of the vacancy on the market, particularly in recently constructed or renovated next-generation facilities. While large pockets of older, less-efficient space remained available, much of the new construction was leased, which laid the groundwork (and provided the confidence) for subsequent phases of development to proceed. Many of those continued on page 8

> Recent Notable lease deals MUNICIPALITY

2 I

ADDRESS

SQUARE FEET

TENANT

Delta

1020 Derwent Way

251,222

Dominion Warehousing & Distribution

Richmond

16068 Portside Road

212,761 (renewal)

Western Canada Express Inc.

Delta

450 Derwent Place

193,494 (renewal)

Amazon Canada Fulfillment Services Inc.

Surrey

18900 34A Avenue

114,000 (build-to-suit)

Weir Canada

Delta

8151 Churchill Street

109,768

Russell A. Farrow (Farrow Logistics)

Surrey

10449 Scott Road

105,100 (build-to-suit)

TEXCAN (Div. of Sonepar Canada Inc.)

Vancouver

1125 Vernon Drive

85,104

Corporate Express Canada

Surrey

5355 152nd Street

81,810 (renewal)

Coastal Pacific Xpress Inc.

Richmond

12291 Riverside Way

74,042

SCI Logistics

Burnaby

2275 Douglas Road

69,404

Vancouver Shipyards Co. Ltd.

Richmond

13248 Worster Court

63,968

Newegg Canada Inc.

Burnaby

8997-8999 Fraserton Court

62,589

Creation Technologies Inc

*Build-to-suit development; completion 2015

Partnership.Performance.

PARKWAY BLVD.

.

OXFORD ST.

COAST MERIDIAN ROAD

.

125 ST.

M

AP

A

H T A

H

C

T

CEADAR DR.

E. WHALLEY RING RD.

ER

HARRIS ROAD

IV

F

R

N CRE SCE NT FER

COAST MERIDIAN RD.

BROADWAY STREET

PITT RIVER RD.

203RD STREET

130TH ST.

128TH STREET

154TH STREET

216TH STREET

GO

176TH ST.

207TH STREET

STATION RD.

196TH B ST. 194TH A ST.

195TH ST.

193RD A ST.

194TH ST.

198TH ST.

240TH STREET

RO

NS

ER OV GL

FORT LANGLEY

CAN

HIG

HWA

Y RAWLISON CRESCENT

RO IE RV HA

GLEN VALLEY

US

148TH ST.

OVE GL

216TH STREET

268TH ST. H 267T

51A

248TH STREET

48TH AVENUE

SCEN

152ND ST.

MURRAYVILLE

SALMON RIVER UPLANDS

160TH STREET

NORTH BLUFF ROAD

262ND ST. 260TH ST.

21ST AVE.

16TH AVENUE

190TH ST.

16TH AVENUE FINLAY STREET

16TH AVENUE JOHNSTON ROAD

MARINE DRIVE

196TH ST.

22ND AVE.

192ND ST.

Sunnyside

200TH STREET

South Surrey Athletic Park

OXFORD STREET

CRESCENT BEACH

184TH STREET

148TH STREET 128TH STREET

20TH AVENUE

29TH AVE.

28TH AVE.

24TH AVENUE

16TH AVENUE

ALDERGROVE-BELLINGHAM HIGHWAY

Beach Grove

Ocean Park

26TH AVE.

25TH AVE.

24TH AVENUE

24TH AVENUE

Tsawwassen Indian Reserve No. 0

6 7

31ST B AVE.

27TH AVE.

191ST ST.

Sunnyside Acres Urban Forest Park

152ND ST.

140TH STREET

56TH STREET

144TH STREET

DR.

Crescent Heights

Y

232ND STREET

N

YDO

BEECH

HW A

32ND AVENUE

CRO

T

ER ST.

28TH AVENUE 27TH AVENUE

HI G

TOWNSHIP OF LANGLEY

194TH ST.

D

188TH ST.

AR

EV

53RD STREET

196TH ST.

192ND STREET 32ND AVENUE

216TH STREET

UL

BO

208TH STREET

GE

OR

CRESCEN

SE R

ALDERGROVE

194TH ST.

GE

32ND AVE. DIV.

190TH ST.

G

CRE

DELTAPORT WAY

F RA

36TH AVENUE

192ND ST.

Elgin

PACIFIC HIGHWAY

ROA

KIN

NT

SCE

176TH STREET

D

ueam Indian Reserve No. 5

DOWNES RO 40TH AVENUE

40TH AVENUE

40TH AVENUE

168TH STREET

MUD BAY

DOUGLAS

‘Spec’ construction tops 1.5 million square feet as developers bank on continued demand 12TH AVENUE

Campbell Valley Regional Park

BUENA VISTA AVE.

Boundary Bay Regional Park

UN

DA

RY

BA

STAYTE ROAD

City Hall

BO

WHITE ROCK

8TH AVENUE

8TH AVENUE

8TH AVENUE

Aldergrove Lake Regional Park

Y RO

AD

ENGLISH BLUFF ROAD

Boundary Bluff

POINT ROBERTS ROAD

Semiahmoo Indian Reserve

Tsawwassen Beach

TOWNSHIP ROAD

C.F.B. ALDERGROVE

BROOKSWOOD

BURLINGTON NORTHERN & SANTAFE RAILWAY

Boundary Bay Regional Park

Speculative industrial development throughout Metro Vancouver has been fuelled by rising levels of leasing activity as users reposition themselves for growth and seek efficiencies that come from occupying new-build space. Boundary Bay

1ST AVENUE

Lease product as well as strata remain popular with numerous projects throughout the region catering to a wide range of demand profiles. Such projects in wellknown industrial nodes such as Gloucester Industrial Estates as well as Tilbury and Annacis Island offer opportunities to locate in Partnership.Performance.

areas that typically have very low availability due to their proximity to the core. SEMIAHMOO BAY

Peace Arch Provincial Park

CANADA U.S.A.

Peace Arch State Park

Additional speculative projects in northeastern Metro Vancouver and the Fraser Valley offer competitive pricing as well as tier-one space in areas that have been made more accessible due to infrastructure improvements, rising population and economic clout south of the Fraser River, and a willingness by users to consider locations outside the region’s traditional industrial hubs. New transportation infrastructure,

ROSS ROAD

52ND

50TH

CRE

DELTA HERITAGE AIR PARK

BOUNDARY BAY AIRPORT

WAY

BRADNER ROAD

LANGLEY AIRPORT

LANGLEY

SCOTT STREET

ATHABASKA ST.

STER

CHURCHILL ST.

LADNER

HARRIS ROAD

55TH

UCE

T

Serpentine Fen Bird Sanctuary and Natural Trails

H CR.

56TH AVE.

GLO

275TH ST.

Hi - Knoll Park

BUR

8 10 9 11 58T

56TH AVENUE

271ST

53RD AVE.

52ND AVE.

CR.

208TH ST.

GLAS

54TH AVE.

53TH A AVE.

ST.

DOU

240TH STREET

52ND AVE.

206

City Hall

LANGLEY BYPASS

E

.

57 A AVE.

ALDERGROVE-BELLINGHAM HIGHWAY

SKEENA ST.

OW A ST.

NU

AVE

A ST.

AVE

205

AL

WAY

60TH AVE.

204TH ST.

176 ST.

Colebrook

STRI

ON

56TH AVE.

PL.

188TH ST.

DR. PANORAMA

ST WE

PRODUCTION BLVD.

D

AR

EV

UL

ROAN

UCTI

PROD

55TH AVE.

55TH AVE.

WAY

203RD ST.

BO

55B AVE.

AN

INDU

198 ST.

ARK

DM

LAN

56TH AVENUE

54TH A AVE.

196 ST.

GE

172ND ST.

Sullivan

OR

AD

LL WI CAN

LOG

Y

WA

199TH ST.

GE

RO

CR.

DUN

60TH AVENUE

177TH B ST.

G

ER

Y

TAYLOR ROAD RD

206

RAI

180TH ST.

144TH ST.

128TH STREET

RN

KIN

RIV

WA

FFO

DE

VICTORIA ST.

AD AH IGH

MU

THE

AY

CANADIAN NATIONAL RAIL WAY

AN

BR

H

202 ST.

64TH AVE.

LANGLEY BYPASS / 61ST AVENUE

SOU

LW

Boundary Bay Regional Park East Delta Accretion

SC

OO

65 AVE.

62ND AVE.

Colebrook Park

R

EC NN

66TH AVE.

TR AN

RO AD

TO

R

H IG HW AY

TAYLOR ROAD

NT

205 ST.

179TH ST.

CE

G

el

nn

y Tu

sse

65A AVE.

HIGHWAY 10 BYPASS

CR

ES

K CO

66 AVE. 65A AVE.

64TH AVENUE

H

203RD ST.

FR AS ER

66 A AVE.

RD.

64TH AVENUE

McTAVISH ROAD

CR

Willowbrook

CLAYTON

179TH A ST.

145TH

CLOVERDALE

176A ST.

152ND ST.

138TH ST.

HONEYMAN ST.

80TH ST.

134TH ST.

68TH AVE.

66TH AVE.

PACIFIC HIGHWAY

NEWTON

68TH AVENUE

Watershed Park

SANGARA AVENUE

72ND AVENUE

72ND AVENUE

SURREY

72ND AVE.

Sunshine Hills

ROSS ROAD

208TH STREET

184TH STREET

74TH AVE.

76TH ST.

192ND STREET

140TH ST.

WILLOUGHBY

Fleetwood Park

130TH ST.

77TH AVE.

144TH ST.

134TH ST.

78TH AVE.

232ND STREET

McCORMICK ROAD

78A AVE.

216TH STREET

130TH ST.

132ND ST.

80TH AVENUE

80TH AVE.

80TH AVE.

ANVIL WAY

76TH AVE.

GRA

52ND STREET

Glen Valley Regional Park

88TH AVENUE

TRA 84TH AVE.

K RD.

1

SILVERMERE LAKE

AY

AD

196TH A ST.

WALNUT GROVE

ADA

135TH A ST.

120TH STREET

Strawberry Hill

Panorama Ridge

OTTAWA ST.

EED HIGHW

91ST A AVE.

LADNER TRUNK ROAD

MONTREAL ST.

Whonnock Indian Reserve No.1

LOUGH

92ND AVE.

PORT KELLS

176TH STREET

Ma

D E LTA

Thornhill

Langley Indian Reserve No.5

McMillan Island

Indian Reserve No.6

196TH A ST.

168TH STREET

160TH STREET

199TH A ST.

192ND ST.

188TH ST. 189TH ST.

187TH ST.

190TH ST.

193RD ST.

156TH STREET

186TH ST.

152ND STREET

148TH STREET

ALBION

96TH AVENUE

Fleetwood 84TH AVE.

ST

Brae Island

97TH

AD

129TH ST.

123RD ST.

Bear Creek Park

AND

MacKENZIE

232ND STREET

E N EARS WAY

LD

203RD STREET

WAY GOLDEN EARS

KINGSTON ST.

HARRIS RD.

144TH STREET 140TH ST.

TR.

94TH A AVE.

92ND AVE.

UPL

ST. JOHN ST.

ST.

SSY STREE

GHNE

SHAU

SHAUGHNESSY

TYNER ST.

DR. CO CHIL

AD RO T RIV ER

SSY GHNE SHAU A

138TH

134TH ST.

132ND ST.

DRIVE

132ND A ST.

W. WHALLEY RING RD.

124TH ST.

AD T RO OT 122ND ST.

124TH STREET

112TH STREET

PH

BROO

48TH STREET

256TH

WAY

TREE

EL

DR

JOHNSON ST.

ON

MARINER WAY

NT CE CR ES W VIE

ER RIV

RN HO PE

NORTH BEND ST.

CA FAWCETT RD.

BURBIDGE ST.

LEEDER AVE.

ST.

DR.

CLIPPER

BRIGANTIN

GLACIER ST.

AV

E.

CAYER ST.

SCHOOLHOUSE ST.

MYRNAM ST.

KING EDWARD ST. 130TH ST.

123RD

131ST ST.

125TH A ST.

124TH ST.

L RD. DR.

STRIA

AM

INDU

QUE

I

MUS

RD. GE

RD.

BRID

RD. D

LAN

RD. UCE SPR

RD.

SC

FIR SPA RD. N RD.

121ST ST.

AD E RO AC

Y WA RD

EL

GRA

96TH AVENUE

95TH A AVE.

94TH AVE.

TELE

COLE

ew ay

224TH STREET

DR

EK

S CRE

HONEYSUCLE LN.

NO

MORAY ST.

ELECTRONICA AVE.

MARMONT STREET WOOLRIDGE

ST. .

AN

AVE

VUL

FOR CAN

UN ETT BR

I A S T RE E T O LUM B

ST C

EA

EN OLS BER TIM

RD. ER

E RD.

LKN

DYK

FAU

R

VE RD SON ROB RD. SON

OXFORD STREET

GATENSBURY RD.

GATENSBURY ST.

BONNEVILLE PL.

RI DER ALA

SKA

GUN

WAY

BURNS ROAD

ROBINSON STREET

BLUE MOUNTAIN STREET

GAGLARDI WAY

LAKE CITY WAY LOZELLS AVE.

PINE

AD RO DE YSI SU NN 1ST AVENUE

TON PRINCE

GLENAYRE DR.

RO AD KE AR CL

ARDEN AVE.

PIPER

AVE. FORD AULD

Y AVE.

WAY ENT DERW

CUND

BOUNDARY RD.

N FRASERWOOD PL.

GRAYBAR RD.

McMILLAN WAY

EN

ROSEBERRY AVE.

NO. 9 RD.

SPE

CONWAY AVE.

KENNETH

ROYAL OAK AVE.

PATTERSON AVE. IVY AVE.

GREENALL AVE.

FRASERTON CT.

FRASERWOOD CT.

NELSON RD.

E

96TH AVENUE

98TH AVE.

Y

72ND ST.

DR.

AVE.

WA

VENTURE ST.

PIPEL INE ROAD

LE

IN

IVE INL ET

E AV EN UE

GILLEY AVENUE

SELLERS

PALM AVE.

MERRITT

RUSSELL

SHIRLEY

TYNE STREET

BOUNDARY ROAD JOFFRE AVE.

NO. 8 RD.

E

V A G

R

E RD. NGL

D.

TRIA

T BLV MEN AIN

ONE

200TH STREET

ERT

TH

236

98TH A

97TH

NST

BER

ENT

UNDERHILL AVE.

EASTBROOK PKWY. .

WAYBURNE DR.

WILLINGDON AVENUE

ST. CE JOY MELBOURNE

PHILLIPS

GILMORE AVENUE

NOOTKA ST. RUPERT STREET

KERR ST.

DR

CLIFF AVE.

RUPERT STREET

SPERLING AVENUE

HOLDOM AVENUE AVE. SPRIN

GER

BETA AVE.

ALPHA AVE.

BOUNDARY ROAD LILLOOET

BENTALL ST.

NOOTKA

KASLO ST.

SAVAGE RD.

PATRICK ST.

BURDETTE ST.

VALMONT WAY

VANDYKE PL.

VIKING WAY

VICEROY PL.

A

NO

JACOMBS RD.

KENSINGTON AVE.

KOOTENAY

WILLINGDON AVENUE

ST.

REFREW STREET

VICTORIA DRIVE

VICTORIA DRIVE

ELLIOT STREET

ARGYLE STREET DR.

CROMPTON ST.

TIPPING RD. SWEDEN WAY

VISCOUNT WAY

KNIGHT STREET

NO. 6 R ROAD

MAYCREST WAY

COMMERCE PARK WAY

4TH AVE.

ST. CHARLES

MOUNTAIN HWY.

ST. ER

LL

ST

COM MISS ION

WA

VICTORIA DR.

McLEAN DR.

WELWYN ST

COMMERCIAL ST.

N ST.

VICTORIA DRIVE

SLO CA

NANAIMO STREET

CLARENDON STREET

MAIN STREET MAIN STREET

FRASER STREET CHESTER ST.

MILLCARCH ST.

PAGE ST.

EBURNE PL.

OLAFSEN

SIMPSON RD.

NO. 5 ROAD NO. 5 R ROAD

FRASER DELTA THRUWAY

NorthDelta

COM

HAMMERSMITH WAY

RD.

84TH AVE.

72ND AVENUE

ANNACIS HIGHWAY

COPPERSMITH PL.

ANS

ERM

FISH

Green Timbers

R RD.

IGH WAY

102ND B AVE.

102 AVE. 101 ST AVE.

98TH AVE.

BAR

88TH AVENUE

86TH AVE.

85TH AVE.

HA

MISSION

Cre

RIVE

ER H

RD.

82A AVE.

80TH AVENUE

WAY

LADNER TRUNK ROAD

us

AY Mc

GS

TYNEHEAD

A

er Fras Alex e Bridg

WA

aka

Kan

Katzie Indian Reserve No.2

200

PL.

RA

KING GEORGE BOULEVARD

NT

HE

Derby Reach Regional Park

Barnston Island Indian Reserve No.3

TRIG Y RD.

Tynehead Regional Park

PACIFIC HIGHWAY

RD.

PL.

UT

82ND AVE.

NORTH DELTA

WILSON AVE.

Websters Corner k

Par

AVE

Barber Island

Ca

HW

HIG

Mann Point

KAY

DAL

Johnston Heights

100TH AVENUE

Woodwards Hill

AWWASSEN ry Terminal

WHONNOCK

ASS

East Haney

Ears Bridge

Green Timbers Urban Forest Park

City Hall

TSAWWASSEN

Y BYP

Golden

Barnston Island

176TH STREET

HOLT

BER

HUM

SO

Reedville

English Bluff

WHONNOCK LAKE

ED

CR.

N DIV GUILDFO RD . DR.

66TH AVE.

16TH AVENUE

GHE

RT

HANEY

113B AVE.

nal

Kennedy Heights

NORDEL WAY

58TH AVENUE

ES RD.

LOU

WA

STE

GUILDFORD King George SkyTrain

84TH AVENUE

WAY

U

Delta Municipal Hall

NE

gio ek Re

YAL

Williamson Island

Gunn Island

HA

Katzie Indian Reserve No.1

92ND AVE.

Kirkland Island

and

DEWDNEY TRUNK ROAD

City Hall

West Coast Express Port Haney

104TH AVENUE

92ND AVENUE

NORDEL CT.

128TH AVE.

LOUGHEED HIGHWAY

Hammond

Surrey Bend Regional Park Reserve

88TH AVENUE

E WAY

.

.

FR AS

Y

VANTAG

CR

West Haney

RD.

SO

.

E PL.

Y ST.

WA

RD

ge

ESHO

AD BRO

AD GU

Surrey Central SkyTrain

IL

RN

DEWDNEY TRUNK ROAD

West Coast Express Maple Meadows

HAMMOND RD.

PITT MEADOWS AIRPORT DYKE

FER

AD

RN

FE

D 108TH AVENUE

E RO

85TH AVE.

128TH AVENUE

Municipal Hall

104TH AVENUE

96TH AVENUE

Annieville

AVE.

132ND AVENUE

DEWDNEY TRUNK ROAD

AR

ER

EST

CH

or

HORS

DEWDNEY TRUNK ROAD

DR.

RO

SCOTT ST.

TT

EV

SHEILD RD.

G PL.

TAN

PI

West Coast Express Pitt Meadows

112TH AVENUE

UL

SHEILD RD.

MUS

PASS L BY HIL RY MA

Fraser Heights

BO

Gateway SkyTrain

WHALLEY

Q2 2015

142ND

e

RIDE

MANITOBA

Bri dg

McB

ASH ST.

Riv er

FRASER

EN

GE

SMITH ST.

N

UE

Fraser Islands Regional Park Reserve

NS

OR

GE

GARDEN CITY ROAD

ON

Pitt

EN

.

G

E PL.

PL.

GARDEN CITY ROAD

C ONT EM RE

SHERLING AVE

Y AV

R RD

OLD

KITTSON PARKWAY

O SL

DEAS

INDUSTRIAL AVE.

WA

HILL BYPASS RY

OS

.

Ge

nd

GS

SHUSWAP AVE.

GR

KIN

LISL

CAR

EY

RIDL

FRASER VIEW PL.

EBURY PL.

CL.

2

KIN

Codd Wetlands Regional Park

PITT MEADOWS

Douglas

Deas Island Regional Park Deas Island

5

McLEAN AVE.

HA

E.

PL.

McALLISTER RD.

E WAY

E RD.

DYK

N. R.

DOMINION AVENUE

AY

NO

108 AVE.

106TH A AVE.

South Westminster

WE

ON

STEAD

Y DERWENT WAY

HW

Port Mann

114TH AVE.

109 AVE.

LIEN WIN RD. RAM RD.

.

Birchland Manor

HIG

VE

DER

EAT

WA

Annacis Island

ROGERS AVE.

117TH AVE.

Q1 2015

Golden Ears Provincial Park

McNEIL ROAD

Mary Hill

ge Brid ann rt M Po

.

D.

ON

HAMP

DSE

LIN

FRASER

UNITED BOULEVARD

VD

E BL

BLV

Y PL.

EAT

RD.

RICE MILL RD. MACHRINA WAY

HORS

EW

EVI

DG

BRI

Cedar Hills

E CT.

TILBU

PROGRESS

DR.

112TH AVE.

RD

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27515 56th Avenue, Langley North View Business Centre

PORT COQUITLAM

Coquitlam Indian Reserve No. 2

M

ST.

LEY

N CT.

RD.

RD.

JACOBSON

ROCKET WAY

Bolivar Heights

110TH AVE.

RIVE

North Delta Nature Reserve

BERG

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Bridgeview

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LE

E

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CANOE AVE.

AVE.

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YA

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TON

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ST.

AUD

PL.

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CAR

EN AVE.

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PIN

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NO

WA

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3 .

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104TH AVE.

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Lincoln Park

West Coast Express Port Coquitlam

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ST

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AVE

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ST

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ITH

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RN

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AS FRA

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East

TRANS CANADA

Columbia St. SkyTrain New Westminster SkyTrain

Poplar Island Regional Park Reserve Poplar Island

S ST.

AD

LOW

A

SSIN

CRO

GIN

WIG

CR.

tul

AV

ST.

ME

Central Port Coquitlam

City Hall

Gates Park

Coquitlam River Wetlands Regional Park

Cape Horn

ST.

ORT

Pat

E.

H

East Richmond

DO

L AV

YA

RO

City Hall

AV

6T

G

T

ER

WIRELESS WAY

S

D

15T

IFF

WAY PL.

FRAS

H

RKE

HT

PKW

T

MA

RIVER

NOR

HY

R

C

PRAIRIE AVE.

Glenwood

COMO LAKE AVE.

Coquitlam

EDW

E.

SON WAY AR D STEW AD

22nd St. SkyTrain

Hamilton

Mac

E.

AV

Edmonds E.

R

H

6T

Nature Reserve

LINCOLN AVE.

EED

AUSTIN AVENUE

Sapperton SkyTrain

E.

2N

Y

GR

Edmonds SkyTrain

Ranch Park

y

WA

KIN GS WA Y

H

LYON

TH

10

ab

ED

.

T AVE

21S

Don Island

HARTNEL

MO

DA NA

PRENTER ST.

8T

Lion Island

FORGE PL.

ND

CA

R ST.

SPRU

RE

NTE

SOUTH RIDGE DR.

O

NORTH ROAD

ET

NEW WESTMINSTER

S ST

Middlegate

PRE

WES T M

Shellmont

AD

RIA

PE

IM

rn

ST.

Bu

ORD

West Coast Express Coquitlam Central

Coquitlam Central SkyTrain

Pinnacle Creek Ravine Park

Chineside

LOUG

st

BERESF

IRMIN ST.

ABERDEEN AVE.

EY TRUNK RD.

Harbour Chines Park

Maillardville

BRAID STREET

UE

AV

De Boville Slough Park

Oxford Heights

Westwood

BARNET HIGHWAY

DEWDN

Inlet Centre SkyTrain

Mundy Park

Braid SkyTrain

EN

Ea

MAVIS DORSET

SHORT ST.

SIDLEY ST.

South Slope

MARINE WAY

DYKE

RO

BU

TUPPER

The Crest

Robert Burnaby Park

AY

McKay Jubilee

BLUN

BLACKSMITH PL.

Burnaby Lake

.

ST

Lincoln SkyTrain

City Hall GLEN DRIVE

City Hall

VICTORIA DR.

Coquitlam River Park

11 5350 275th Street, Langley

Austin Heights

Cariboo

L ST

RUMBLE STREET

GLEN

FOSTER AVENUE

NOR

ET

Y.

DELL

SANT

N&

Douglas-LaFarge SkyTrain

OZADA

10 27515 56th Avenue, Langley GOLDEN SPIKE

COMO LAKE AVENUE

Lougheed Town Centre SkyTrain

THER

ON

LAKE

Town Centre Park

DR.

Laurentian

Coquitlam West Lougheed SkyTrain

RE

N

McLennan

WAY

RAIL

A FE

OAKLAND ST.

RICHMOND FREEWAY

OND

ABY

S.E. MARINE DRIVE

KNOX WAY

INTERNATIONAL PL.

RN

AW AD

DOVER ST.

Lulu Island

Gil

Q2 2015

NIE

GH

OO

IS

RR

ST.

WESTMINSTER HIGHWAY

Isla

Beedie Development Group

OW

River Springs

LOU

RIB CA

Deer Lake Park

SPARWOOD PL.

C.

Q1 2015

124,000

DSD

GUILDFORD WAY

MURRAY ST.

Harbour Place

TH

WESTMINSTER HIGHWAY

ur

Kenbri Development Corporation

Canyon Springs

Eagle Ridge

LAN

FALCON

D

BOO

MAYFIELD PL.

Cambie

mo

83,730

AV

E.

COQUITLAM

INGT

NORTHBROOK CT.

RIVER RD.

Stoney Creek Park

BURL

Metrotown SkyTrain

VIKING PL.

CRESTWOOD PL.

Government Road CONRAD ST.

BU

Patterson SkyTrain

FR

CLARKE PL.

DELF PL.

HAMMERSMITH GT.

Beedie Development Group

DR.

VID

Port Moody Centre

Burquitlam SkyTrain

Sullivan Heights

Y WA ON CTI DU PL. PRO BAXTER

LOUGHEED HIGHWAY

GOVERNMENT RD. BURNLAKE DR.

Buckingham Heights

Deer Lake

Suncrest

Champlain Heights

ENTERPRISE ST.

WINSTON STREET

CAN

NGE

AY

Oakdale

EASTLAKE DR.

University SkyTrain

Y

VANIER PL.

more

86,510

Pitt Addington Marsh Wildlife Area

DA

5525 272nd Street , Langley

I

Y

Burnaby Lake Regional Park

H

ROWAN PL.

AY

GSW

Y

Simon Fraser Hills

Lake City

Lake City SkyTrain

Municipal Hall

GRA

VERDUN PL.

WORSTER CT.

SILVERSMITH PL.

Parkland Business Centre

INE

West Coast Express NOOTKA Port Moody KLAHANIE DR. WA

MURRAY

DEER LAKE PKWY.

RT

GREAT CANADIAN WAY

BATHGATE WAY

WA

Deer Lake Place

Garden Village

NO

BURROWS RD.

WAY

VULC

HW

Killarney

A HIG

KIN

CR.

k St. Oa ge Brid

AN

ALL PL.

VAUXH

VICKERS WAY

CA NA DA

SARDIS ST.

Central Park

49TH AVENUE EAST

JOE SAKIC WAY

AD

41ST AVENUE EAST

AIN

.

RIVER RD.

LAUREL ST.

Greentree Village

Forglen

MP

RD.

GREENWOOD ST. DARNLEY ST.

CAN

MOSCROP ST.

Joyce St. SkyTrain

Fraserview

Knight Street Bridge

REL

R ST.

LAU

THE

E ST.

HEA

MITCHELL RD.

Mitchell Island

VOYAGEUR WAY

D

Horizon Pacific

Moody Centre SkyTrain

COMO LAKE AVENUE

EXPRESS ST.

AVE.

NS

29TH AVENUE

KEITH ST.

TWIGG

TWIGG PL.

Bridgeport

BRIDGE PORT ROAD

86,340

Minnekhada Regional Park

A DR.

PANORAM

RAV

9 ESPLANADE

Harbour Chines WA

BROADWAY

Sperling SkyTrain AND

SPROTT ST.

AY

DI

Forest Hills

KINGSLAND CT.

NORL

Royal Oak SkyTrain

SOUTHEAST MARINE DRIVE

Montecito

ST.

ROY ST.

B. C. I. T.

KENT AVE. S.

WAY

Q1 2015

Horizon Pacific Corporate Centre II

North Coquitlam

26988 56th Avenue, Langley

SID

E RD

AILSA AVE.

AR

E DR.

Holdom SkyTrain

GORING

REGENT ST.

WILLINGDON GREEN

NORFOLK

54TH AVENUE

57TH AVENUE EAST

69TH AVE.

HOR

Bridon Developments

7 RK

SAINT JOHNS STREET

GL

ON

STILL CREEK AVE.

Central Burnaby

CHA

68TH AVE. 70TH AVE.

120,000

Westwood Plateau

M O O D Y8

GA

YST

EET STR

FRASER STREET

JUNEAU ST.

GLENNCOE

Simon Fraser University GRE

N

49TH AVENUE EAST

South Vancouver

Marine Drive SkyTrain

AISN

NE

VAN

DAWSON ST.

DOMINION

RIVER DR.

ST.

SUMAS ST.

Gilmore SkyTrain

STILL CREEK AVE.

11TH AVE.

SIMON FRASER UNIVERSITY

N.

Duthie

Squint Lake Park

TRA

FRASER STREET

LOUGHEED HIGHWAY HENNING DR.

RD.

IMPERIAL STREET

IVE DR INE AR T M 70TH AVE ES HW 71ST AVE.

Q2 2015

Bridon Heights

Pinecone Burke Provincial Park

Ridge Park

2052 192 Street, Surrey

PA

CLARKE ST.

Glenayre

BURNABY

TO

Knight

KNIGHT STREET

CAMBIE STREET

ETT

CORN

CANADA WAY

29 th Ave. SkyTrain

KIN GSW

41ST AVENUE EAST

49TH AVENUE EAST

South Cambie

Beedie Development Group

College Park COLLEGE PARK WAY

Y MT

NS

Oakridge

CURTIS STREET

Parkcrest

Brentwood SkyTrain

BUCHANAN

ALASKA ST.

Rupert St. SkyTrain

Burnaby Mountain Conservation Area

AB

Sperling

WI

KNIGHT STREET

Victoria

Memorial South Park

PARKER STREET

Brentwood Park

HAlFAX ST.

22ND AVE.

Nanaimo St. SkyTrain

33RD AVENUE EAST

41ST AVENUE EAST

Langara/49th Ave. SkyTrain

85,610

BARNET H IGHWAY

D

RN

DOUGLAS RD.

John Hendry Park

Main

Oakridge/41st Ave. SkyTrain

VIRTUAL WAY

ROA

Westridge

BU

Renfrew St. GRANDVIEW HIGHWAY Falaise Park SkyTrain

22ND AVE.

N

HIA

OT

DL

MI

Fraser

33RD AVENUE EAST

10TH 12TH

COUVER

UT

NANAIMO STREET

EAST BROADWAY

20TH AVE.

Cambie

2ND AVE.

Commercial St. SkyTrain

18TH AVE.

Queen Elizabeth Park

Twin Creeks Business Centre (Phase I)

Crown Park

.

Duthie Union Park

GRANT ST. GRAVELEY ST.

Broadway SkyTrain

AY

Willingdon Heights

WILLIAM ST.

CHARLES ST.

KITCHNER ST.

1ST AVE.

1ST AVENUE

12TH AVENUE EAST

BARN ET

Stratford Park

NORTH ROAD

ONTARIO ST.

SALSBURY DR.

ROGERS ST.

ST.

VCC-Clark SkyTrain

EAST BROADWAY

King Edward SkyTrain

ST

PARKER STREET

1ST AVENUE

RN WA Y

8TH AVE.

KIN GSW

NG EDWARD AVENUE

Marpole

Grandview

Renfrew

City Hall MANITOBA ST.

COMMERCIAL DR.

GRANDVIEW VIADUCT

NAL AVE

G WAY

Broadway/ City Hall SkyTrain

CAMBIE STREET

WOODLAND DR.

GLEN DR.

RAYMUR AVE.

CHESS

VERNON DR.

ODLUM DR.

CLARK DRIVE

NAPIER

AVE.

COMMERCIAL DRIVE

DUNLEVY AVE.

THORTO N ST.

STATION ST.

WESTER

ST. LOR NE

EVANS

TERMI

FINNIN

GREAT NORTHE

SCOTIA ST.

QUEBEC STREET

ST. GEORGE CAROLIN A BEGG ST.

N ST.

Cambie Bridge

YUKON ST.

ALBERTA ST.

EARL

.

Hastings Comm. Park

PARKER

Mount Pleasant

IAL AVE.

E.

192nd Street & 22nd Avenue, Surrey

LOUGHEED HIGHWAY

COLUMBIA ST.

AVE

AL AVE.

INDUSTR

AVE

AV

Q1 2015

6

OA

1ST

EAST HASTINGS STREET

Barnet Marine Park

Scenic Park

RD.

5TH AVE.

6TH AVE. 7TH AVE.

D

Capitol Hill

AS

BROADWAY WEST

2N

Conwest

OR OC

MALKIN

NATION

NORTHERN ST. CENTRA SOUTHEL ST. RN ST.

R.

UGL

LIE WY

Olympic Village SkyTrain

4TH AVE.

P.

Confederation Park

DO

WE CRO

K

COO

3RD AVE.

49,000

North Shore Port Moody

IO CO

ST.

ET RE

1ST AVE.

2ND AVE.

P.N.E. Exhibition Park

DUNDAS STREET PANDORA ST.

PENDER ST.

GEORGIA ST.

PORT

BU

RT SHO

E ST

Main St. SkyTrain

Olympic Village

River's Edge Buisness Park (Building 2)

N

ITH

EK

572 Nicola Place, Port Coquitlam

TO ING

SM .

FIC BLVD

PACI

CRE

FRANKLIN ST.

VENABLES STREET PRIOR STREET

ST.

STEWART

VA DO . COR DIV

SkyTrain

YaletownRoundhouse SkyTrain

wn

AY ST.

RAILW

POWELL STREET CORDOVA STREET WEST HASTINGS STREET

ET RE R ST StadiumME Chinatown

HO

Q4 2014

5

SH

ET

3RD ST.

AD RO

C.

Vancouver ETON STREET

CASSIAR TUNNEL

RE

Oxford Properties

Village Hall & Museum

Village Hall

Belcarra Regional Park

PORT MOODY

nel) (Tun

ST

R OU

BEDWELL BAY RD.

AD RO

Cates Park

McGILL STREET

Hastings East

WE

ROA

BAY

BID

Boulder Island

Dollarton

Roche Point

RAIL

ET

YM SE

245,000

D

LL

HARBOUR RD.

C.N.

RE

WATER

Gastown Granville St. SkyTrain

Vancouver City Centre

E ST

Queensborough Logistics Centre

WA

T

FRONT

wntown

ROAD

501 Boyd Street, New Westminster

RIL AP

SPICER RD.

COLUMBIA ST. BAY ST.

Second Narrows Bridge

PL.

Waterfront SkyTrain West Coast Express

Q4 2014

4

BELCARRA

Hamber Island

White Rock

Roche Point

Montrose Park

CAN

ADA

Grosvenor

WESTWOOD

T

ST.

STREET

DOMINION ST.

Burrard Inlet Indian Reserve No. 3

DOLLART ON HI GHW AY

OLD DOLLARTON HWY. FRONT

MAIN

Jug Island

NORDEL WAY

BOND ST. OXF ORD ST. .

CURAGH

LYNN AVE.

Windsor Park

Windridge

GE DR.

WINDRID

Seymour Creek Indian Reserve No. 2

CROWN ST. RUPERT ST.

Cove Cliff Myrtle Park

RA RD

Maplewood

HUNTER ST.

CHARLOTTE

BUR RARD INLET

MT. SEYMOUR RD.

BERKLEY RD.

VE DRI ORL YNN ARB

LILLOOET ROAD

MOUNT SEYMOUR PARKWAY

Calverhall

ROAD

Northlands Seymour Heights

RANDOLPH

LEVEL

Riverside

Lynnmour

FORESTER ST.

LOW

EET

162,715

AD

Lower Lonsdale

LYNNMOUTH

4TH ST. E.

3RD ST. E.

E E.

HAROUR AVE.

EAST GRAND BLVD.

QUEENSBURY AVE.

E.

AD

STR

Millennium VI

T RO EAS

LAN

BROOKSBANK

ST. GEORGES AVE.

AV E.

Keith Lynn

LD FIE

AVE

E.

ER

ALE

CH EST

GE S AV

NSD LO

GE OR ST.

3RD

ESP

DER

Q1 2015

1005 Derwent Way, Delta

D. U BLV

KEITH ROAD EAST

N. DOLLARTON HIGHWAY

GOSTICK AVE.

13TH ST. E.

City Hall

W.

Mission Indian Reserve No. 1

HARBOURSIDE DR.

PEN

Beedie Development Group

TEA

COPPING ST.

Deadman Island

110,000

PLA

AVE.

Belcarra Regional Park

R

MOUNTAIN HIGHWY

AVE.

WESTVIEW DR.

FELL

HANES AVE.

DONAGHY AVE.

PEMBERTON

MACKAY RD.

LLOYD

CAPILA NO RD. LOWER

13TH STREET W. 2ND ST. W.

Hamilton

3RD EN

Wickenden Park DEEP COVE ROAD

PHILIP AVE.

.

CHI JEN EF KINSCHA RD. RLIE

DR

Indian River

Y WA IGH SH

BOWSER AVE.

NIS

AN

HY

Blueridge EL LEV ER UPP

GARDEN AVE.

NS RD.

ROOSEVELT 14TH ST. W. 3RD ST. W.

ST.

McKE

AUTOMALL DR.

Burrard St. SkyTrain

DEEP COVE

GALLANT AVE.

INDIAN RIVER DR.

HOSKI

15TH ST.

WELCH ST.

1ST

Lynn Canyon Park

Westlynn

Central Lonsdale

ON

LA

BAINBRIDGE

. VD BL

23RD ST. W.

CITY OF NORTH VANCOUVER

Westlynn Terrace

GREENFORD AVE.

OK

NT MO

AD

Y RO

VA

LY

RS

Norgate

Tilbury West Corporate Centre (Phase II)

PIT

N

IA

D HOSKINS RD.

Racoon Island

29TH ST E. LLE

CHURCHILL

6951 72nd Street, Delta

ANMOR 3E

Mount Seymour Provincial Park

Upper Lonsdale QUEENS RD. W.

NN

STEWART ST.

Lynn Valley

PRINCESS AVE.

AVE .

BLV D. HLA ND HIG

DEL BRO

NO ROAD

OSBORNE ROAD E.

GE ED

CAPILA

BRAEMAR ROAD E.

Municipal Hall

Pemberton Heights

Indian Arm Provincial Park

IN

STEVE

Delbrook

UPPER LEVELS HIGHWAY

MARINE DRIVE

Q4 2015

2

A

DR

DEMPSEY ROAD

Pemberton

Estimated Completion

Dayhu Group

NA

Braemar

e

Developer

420,000

Mc

Forest Hills

Hugo Bay Park

Size

Boundary Bay Business Park (Building 2)

RM

.

IR

Upper Delbrook

GR

NS DRIVE

Upper Lynn Valley

MONTROYAL BLVD.

Capilano Highlands

Project name

8181 Churchill Street, Delta

ST.

NANC

Y GREEN EWAY

DISTRICT OF NORTH VANCOUVER

Capilano River Regional Park

Address

1

Lynn Headwaters Regional Park

Woods

SCHOONER

Grouse

Glenmore

particularly the South Fraser Perimeter Road, has prompted developers to break ground on speculative projects in the Delta industrial market. Further buoyed by rising container activity and the expansion of marine terminal operations, Delta’s industrial market remains focused on logistics and distribution users. Large vacant blocks of space have long contributed to Delta’s elevated vacancy rate (compared with the rest of Metro Vancouver), but the ongoing absorption of that space has provided confidence to other developers to offer large-block space (50,000 sf+) on a scale unfamiliar to this market.  Matsqui Indian Reserve No.4

CANADA

CANADA

U.S.A.

U.S.A.

I 3

Q&A Paul Tilbury Chief Operating Officer Dayhu Group of Companies Joining Dayhu in 2007, Tilbury is responsible for the day-to-day management of 3.8 msf of industrial and commercial properties as well as targetting growth opportunities for the group. Greg Wilks VP, Commercial Property & Leasing, Onni Group Wilks joined Onni in 2004 and directly manages an industrial portfolio of 2.2 million square feet (msf), while also managing Onni’s office portfolio in Edmonton, L.A. and Chicago.

Jeff Miller Vice-President, Industrial Oxford Properties Group Miller joined Oxford Properties in 2013 and is responsible for Oxford’s industrial business, including acquisitions, asset management, financing, leasing and operations.

Michael Beattie Chief Investment Officer Grosvenor Americas Responsible for leading the investment and portfolio management teams in Grosvenor Americas’ four North American offices, Beattie has been with Grosvenor since 2000. He oversees the acquisition and disposition of assets as well as their management. Murray DeGirolamo Executive Vice-President Hopewell Development Appointed as Executive Vice-President in 2012, DeGirolamo’s current role is overseeing all of Hopewell’s acquisitions and dispositions across Canada. Before joining Hopewell in 2005, DeGirolamo spent 14 years as a broker in Vancouver.

4 I

Speculative industrial development has returned to the Metro Vancouver market as demand for space continues to outpace supply. Avison Young spoke with a number of top industrial developers in the region to learn why they proceeded now and how they plan to succeed.

1. Identify the challenges and opportunities you recognized in the market that triggered the decision to break ground.

2. What factors led you to believe that your project will be successful in its respective market? Paul Tilbury 1. Our decision to build the first of

two 440,000-sf speculative buildings at Boundary Bay Industrial Park was triggered around acknowledgement of several challenges and opportunities in the Metro Vancouver market. First, the anticipated completion of the South Fraser Perimeter Road (SFPR) in December 2013 meant that there would be a tremendous focus on activity south of the Fraser River, with a defining shift in the east/west movement of goods and an anticipated spike in demand for distribution centres along the roadway. The opportunity to be one of the first offerings along this corridor combined with being the closest location to Deltaport could not be discounted. Secondly, there was a timing gap when no other major warehouse developments were coming to market. With limited contiguous industrial acreage available that would permit competitive scale, a unique marketing opportunity for our first phase arose. Finally, a desire to complete the first phase before changes in code added a potential 10% premium to construction costs all helped determine our decision to build on “spec”.

2. While success is never guaranteed, our confidence in this project was driven by our plan to deliver a building that offered flexibility to tenants in a well-situated location. We had seen, especially in Metro Vancouver, a demand for seasonal storage as a result of this market being so weighted towards consumer goods. This has caused several tenants to take secondary warehousing on a short-term basis, which can be challenging in a market with a sub-5% vacancy. Therefore, with this project’s 36’

clear ceiling height, we offer an advantage through cubic capacity for tenants to be able to ride the varying demand cycles. As referenced, the proximity to the SFPR we felt was a compelling positioning statement for this development, coupled with newly installed direct access to Highway 99 and upgraded interchanges. Lastly, the development of a combined 900,000 sf offers potential tenants real expansion space over the span of leases and allows for growth without relocation costs.

Greg Wilks 1. Pitt Meadows was not known for

its industrial market when we started Golden Ears Business Park (GEBP). We believed in the property and its location and took on a “build it and they will come” mentality. One of the successes of GEBP has been our ability to take advantage of short requirement times for certain tenants. If we had not started to construct the (now occupied) buildings on a spec basis, there is a high likelihood we would not have been able to accommodate their occupancy time lines. Due to Metro Vancouver being a smaller industrial market, many outof-market tenants looking to enter the market are surprised to find the lack of good, efficient, well-priced warehousing options. Being able to deliver this option to the market, we proceeded to continue to build on ‘spec’ and successfully lease thereafter.

2. GEBP has the unique opportunity of having lower land and municipal costs, which gives us an advantage against other markets in Metro Vancouver. Being located minutes from the CP intermodal yard, Port Kells, Highway 1 and the SFPR allow us to compete with Partnership.Performance.

the bigger submarkets in Metro Vancouver. Employee retention is an important factor for all businesses, especially in the warehousing business. With an affordable cost of living available in Pitt Meadows, we find a lot of our tenants are thrilled to have the opportunity to live where they work rather than commute. Construction on phase one of GEBP is now complete and we are anticipating building another 350,000 sf of ‘spec’ product to kick off phase two in 2015. In our development of GEBP to date, we have found we can offer a source of new product to satiate demand from local tenants, who otherwise would have to look further east or south.

Jeff Miller 1. Needless to say Metro Vancouver is a

tightly held and expensive land market, particularly when securing well-located in-fill sites of scale that can accommodate a typical Oxford industrial park. Our recent commitment to acquire Queensborough Logistics Park (QLP) on Boyd Street in New Westminster provided us with an immediate opportunity to supply class A warehouse and logistics space to the Metro Vancouver industrial market. We currently have 243,000 sf under construction with the next phase of 300,000 sf planned for delivery in 2016. Metro Vancouver is no different from other major markets where speculative development provides the necessary inventory for tenants who often have limited time frames in which to secure a new location. With a limited supply of existing buildings to purchase, which are also expensive and often compromised in design, we feel comfortable providing new ‘spec’ product to the market.

2. A major focus for our industrial platform in all markets is developing business parks of scale in core locations that are close to key transportation infrastructure and population centres. QLP has central proximity to Canada’s main ports of entry in Metro Vancouver and great access to the local highway network for companies to reach their customers. In-fill locations like QLP and Oxford’s other site, Riverbend Business Park in Burnaby, are important for users to attract and retain employees and offer nearby amenities. Often new Partnership.Performance.

industrial developments in major cities are forced to secondary locations where little public transit and few amenities exist. The building we currently have under construction incorporates efficient specifications with 32’ clear ceiling heights, 55’ column spacing, T5HO lighting, a high ratio of shipping doors, and trailer parking. We are confident that companies looking to grow will seek modern distribution centres with flexible designs.

“The anticipated completion of the South Fraser Perimeter Road in 2013 meant that there would be a tremendous focus on activity south of the Fraser River.” - Paul Tilbury Michael Beattie 1. Grosvenor Americas, owner of 20% of

the property in Annacis Business Park, reviewed the market in early 2012 and identified a shortage of supply in tier-one industrial buildings for users in excess of 100,000 sf. At the time we were analysing the merits of our Millennium 6 development, only five such buildings were available. In addition, the SFPR was expected to be completed in 2013, which would provide access to all five major crossings of the Fraser River, dramatically improving drive times through Delta and Surrey. The SFPR would also provide efficient connections to Richmond, New Westminster and Burnaby, and toll-free access to Highway 1. In our experience, it has become increasingly difficult for tenants to forwardlease industrial buildings given extended development time lines. We feel, and felt at the time, that the proposed infrastructure improvements in the area (SFPR and Deltaport) mitigate the speculative development risk and that owners of high quality, tier-one buildings will be rewarded.

2. For more than six decades, Grosvenor Americas has been the largest single land owner within Annacis Business Park and today controls 1.1 msf of bulk warehouse and production facilities across 10 buildings on 250 acres. Our latest building, Millennium 6, was completed in October 2014. The development comprises 165,000 sf and offers distribution and storage efficiencies

with 26 dock doors, 32’ clear ceiling heights and a 57’-by-40’ grid system. As the original developer of the park in 1957, Grosvenor has a solid understanding of its evolving nature and the changing needs of the tenants attracted there. Our portfolio and additional land have proved advantageous in enabling us to provide expansion opportunities within the park and to satisfy the growth needs of our tenants.

Murray DeGirolamo 1. The challenges to Metro Vancouver’s land

market are limited supply and cost. It’s not only the underlying values, but the cost to bringing land online. It is very challenging to find a site that can provide the scale that we and our institutional partners are looking for. When looking at the opportunities and the decision to proceed on any development, whether in Vancouver or any other Canadian market, one has to look at the underlying metrics of the market itself, including vacancy rates, absorption, rental growth, liquidity/cap rates. As a traditional merchant developer, we speculate on all our projects so timing and understanding of the market is critical. We don’t traditionally land bank so our timing has to be accurately calculated. The trigger for Campbell Heights was overcoming those challenges and constraints associated with the Vancouver land market. The 38 acres provides scale with the potential to develop more than 750,000 sf.

2. We feel Campbell Heights will be successful as the area is an emerging alternative to tenants looking to locate in the Fraser Valley. Tenants have long migrated east along the TransCanada Highway to areas like Port Kells and Gloucester. These markets are nearing capacity and tenants are being forced to ‘outlying’ alternatives such as Campbell Heights. Tenants of 50,000 sf to 100,000 sf are limited in growth options. We typically try to identify a product that is in demand and is not being met or provided for. We will be able to provide space to a tenant of 25,000 sf to 150,000 sf. The buildings will feature all the latest in building technology and efficiency found in best-in-class distribution space. Because we don’t have to preload our site in Campbell Heights, we do not have to predetermine our exact building envelopes and building configurations. This will help provide us more flexibility in accommodating tenant requirements. I 5

Avison Young Industrial Lease Listings

PHASE 4 - 50 ACRES

PHASE 1 -35 ACRES

COMPLETE WITH 650,000 SF IN 5 BUILDINGS

PHASE 3 - 50 ACRES

PHASE 2 -58 ACRES

golden ears business park, pitt meadows

Surrey Southpointe Business Park, SURREY

HORIZON PACIFIC CORPORATE CENTRE II, LANGLEY

• Phase I: 17,910 sf - 120,000 sf of space available • Phase II: Build-to-suit options up to 1.1 msf to accommodate various sizes

• Multi-tenant warehouse from 20,000 sf - 200,000 sf • Single tenant from 450,000 sf - 625,000 sf • First building available mid-2016

• Prelease warehouse and office space • Leasing opportunities ranging from 9,000 sf - 86,000 sf • Available March 2015

John Lecky / Ryan Kerr / Ben Lutes

Michael Farrell / Robert Gritten

Michael Farrell

%

66

5495 REGENT STREET, BURNABY

CAMPBELL HEIGHTS WEST BUSINESS PARK, SURREY

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27515 56th AVENUE, LANGLEY

9425 190th STREET, SURREY

• 56,100 sf on 4.04 acres • Rare freestanding cross-dock and office facility

• Up to 400,000 sf available • Pre-leasing opportunity in prime Campbell Heights location

• Prelease up to 29,934 sf of warehouse space with offices build-to-suit • Ready for occupancy in January 2015

• Industrial built-to-suit for lease • 2.89 acres • Multi-tenant configuration (30,000 sf +)

John Lecky / Ryan Kerr / Kevin Kassautzki

Mathew Sunderland / Robert Gritten

Michael Farrell / Mathew Sunderland

John Lecky / Michael Farrell / Gord Robson

% 50

8130 Winston Street, Burnaby

le

a sed

18964 96th AVENUE, SURREY

#1, 2 & 3-19272 96th AVENUE, SURREY

• Up to 41,385 sf available • Dock and grade loading • Office configured to suit

• Large service facility with drive-in bays and yard area • 18,000-sf building on 2 acres

• Opportunity to sublease 18,426 sf • Excellent access/exposure to 96th Avenue

Kyle Blyth / Matt Thomas / Ben Lutes

Michael Farrell / Gord Robson

Jeron Dillon / Doug McMurray

2480 SHELL ROAD, RICHMOND • 17,000 sf of warehouse space with small yard • Demisable into two portions of 7,000 sf and 10,000 sf Jeron Dillon / Ryan Kerr

#130-2155 DOLLARTON HIGHWAY, NORTH VANCOUVER

1615 MACDONALD AVENUE, BURNABY

• 13,283 sf available • High quality office/showroom & high-ceiling warehouse space for sublease

• 13,630-sf freestanding facility • Currently used as a commercial bakery • Dock loading

Terry Thies / Ian Whitchelo

Kevin Kassautzki

CAPILANO BUSINESS PARK, NORTH VANCOUVER

7836 venture street, burnaby

• Leasing opportunities in the North Shore’s premier business park • Flexible unit sizes from 680 sf -10,485 sf

• 6,975 sf of high quality showroom/ warehouse space for sublease • Dock and grade level loading

Terry Thies / Ian Whitchelo

Ben Lutes / Kyle Blyth

6 I

#120-11820 HORSESHOE WAY, RICHMOND

340-344 LYNN AVENUE, NORTH VANCOUVER

• Approx. 13,500 sf of office/warehouse space • Racking available if needed

• Light industrial units from 4,344 sf 10,549 sf • Grade-level loading

Jeron Dillon / Ryan Kerr

Terry Thies / Ian Whitchelo

CYPRESS BUSINESS CENTRE, NORTH VANCOUVER • Units from 480 sf to 5,910 sf • Centrally located business complex Terry Thies / Ian Whitchelo / Dan Smith

285 EAST 1st AVENUE, VANCOUVER • 5,500 sf • Opportunity to lease premium flex industrial/office/showroom space Struan Saddler

Partnership.Performance.

Avison Young Industrial Sale Listings

BRIDGEVIEW DRIVE BUSINESS CENTRE, SURREY

758 harbourside drive, north Vancouver

• Light industrial strata warehouse units ranging in size from 2,625 sf - 40,000 sf • Grade-level loading • Easy access to the South Fraser Perimeter Road

• 26,000-sf freestanding office/warehouse facility • 39,825-sf site • Located in Harbourside Business Park

7277 FRASERVIEW PLACE, MISSION

#103, 104 & 105-758 COPPING STREET, NORTH VANCOUVER

• Boutique industrial strata development • Varying unit sizes available • Completion Q1 2016 Ben Lutes / Kyle Blyth

Terry Thies / Ian Whitchelo

John Eakin / Michael Farrell / Gord Robson

580 DOMINION AVENUE, port Coquitlam

5575 SHORT STREET, BURNABY

#106-19188 94th AVENUE, SURREY

• 0.77 Acres • Industrial zoned, serviced, filled and ready for development

• Three contiguous light industrial strata units • 5,826 sf available

• 9,430-sf freestanding facility • High-exposure corner site • Proximity to SkyTrain

John Eakin / Gord Robson

Terry Thies / Ian Whitchelo

Kevin Kassautzki / John Lecky

• Located within the desirable Port Kells Industrial Park • 3,535 sf • Immediate access to Highway 1 John Eakin / Gord Robson

Recent Avison Young Transactions S OL

D

13056 114th avenue, surrey

S OL

9.53 acres

John Eakin / Bal Atwal / Michael Farrell

D

8700 & 8790 BOUNDARY ROAD, BURNABY

L

4 acres

Kyle Blyth / Matt Thomas / Ben Lutes

S EA

ED

1020 DERWENT WAY, DELTA

S

251,222 SF

Douglas McMurray / Robert Gritten / Ryan Kerr

so ITE

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580 dominion avenue, port coquitlam

5 acres

Ben Lutes / Kyle Blyth

Recent Metro Vancouver Industrial Investment Sales

12111 RIVERSIDE WAY, RICHMOND • Vendor: Panasonic Canada Inc. • Purchaser: Canasia Toys & Gifts Inc. • Purchase Price: $16,600,000 • Price Per Square Foot: $124 • Building Size/Site Area: 133,513 sf/1.49 acres

80 & 84 GOLDEN DRIVE, COQUITLAM • Vendor: 70 Golden Drive Ltd. • Purchaser: Rockstad Power Corp. • Purchase Price: $11,300,000 • Price Per Square Foot: $299 • Building Size/Site Area: 37,384 sf/7.05 acres

12111 Bridgeport road, richmond • Vendor: Griffin Holding Corp. • Purchaser: Kingvision Enterprises Ltd. • Purchase Price: $8,900,000 • Price Per Square Foot: $219 • Building Size/Site Area: 40,700 sf/1.5 acres

4460 jacombs road, richmond • Vendor: Viksun Enterprise Ltd. • Purchaser: Chung Laam Holding Ltd. • Purchase Price: $8,100,000 • Price Per Square Foot: $202 • Building Size/Site Area: 40,084 sf/2.1 acres

> Recent Notable Industrial Land Sales ADDRESS

VENDOR

PURCHASER

SALE PRICE

SITE AREA (ACRES)

PRICE/ACRE

8398 North Fraser Way, Burnaby

TransLink

Bosa Properties 

$14,200,000

13.04

$1,088,957

9702 Glenlyon Parkway, Burnaby

Canada Lands Company

Beedie Group

$11,960,000

14.09

$849,130

13056 114th Avenue, Surrey

Bridgeview Developments Ltd. 

1002029 B.C. Ltd. (Wesgroup)

$7,800,000

9.54

$817,524

860 Dominion Avenue, Port Coquitlam

Individual(s)

Teralink Investment Group Inc.

$6,100,000

7.13

$855,300

3211-3277 189th Street, Surrey

City of Surrey

1001599 B.C. Ltd.

$4,380,000

5.85

$749,230

26074 30 A Avenue, Langley

Individual(s)

AP Tire Services Ltd.

$2,275,000

4.96

$458,669

$2,458,000

7.92

$310,197

12935 & 12955 261A Street, Maple Ridge Kanaka Business Park Development Ltd.  Ardex Canada Inc Partnership.Performance.

I 7

continued from page 2

projects are now under construction or proposed to commence in the near term. Second, a subsequent lull in activity by larger users that began in the fall of 2013 was offset by a significant increase in deal velocity among medium and small-bay tenants. While expansion did factor into some of these transactions, repositioning and rightsizing were also significant factors. And third, emerging from the typical summer doldrums, large user groups were once again active this fall with significant lease deals absorbing much of the existing large-block, tier-two industrial space on the market. These transactions paved the way for much of the existing and new demand to be directed towards industrial developments that were recently completed, remain under construction or are set to commence in the near term. Industrial users active in the market have represented a combination of logistics and distribution companies along with modest demand from manufacturing firms. One example of such demand is the recently announced 114,000-sf buildto-suit development in Campbell Heights for R. Wales Canada, a business unit of Weir Canada Inc., which provides engineering services and manufactures processing equipment for the resource sector. In terms of leasing activity, Dominion Warehousing has recently leased 251,000 sf on Annacis Island and is a new entrant to the Metro Vancouver market. It is anticipated that industrial users of all types will remain active as the full impact of recent infrastructure investments begins to take root. The ongoing expansion of port facilities combined with rising container volumes and the decision by the Tsawwassen First Nation to proceed with a 1.2-msf warehouse as part of the native-owned Tsawwassen Gateway Logistics Centre (along with large-bay projects from Dayhu Group, Onni Group and Hopewell Development) are fuelling the bullish outlook for the continued demand for bulk space. Construction activity in Campbell Heights in Surrey, an increasingly popular industrial node in Metro Vancouver, serves as a snapshot of the wide range of tenant and user demand currently in the regional market. All the different sectors of demand are represented in Campbell Heights, including small, medium and large-bay lease options, build-to-suit developments and strata units. Increased leasing activity, delivery of new product and positive absorption of space has not translated into upward pressure on rental rates and is unlikely to do so in the near to mid-term. The average asking rate on a psf basis in Metro Vancouver is $8.59 as of fall 2014, a decline from $8.74 a year earlier. Additional rents average $3.81 psf, which remain virtually unchanged from last year’s $3.86. Competitive pressure for BC to remain a cost-effective jurisdiction vis-à-vis Alberta has played a role in keeping rates stable, which eliminates volatility and provides cost certainty, but curtails rent increases despite expensive land costs. Industrial land prices, while high in comparison with other jurisdictions due to the geographical and political constraints placed on much of the region, have remained stable since approximately 2009. As a result, rents have remained static and have yet to surpass the peak reached in 2007/2008. While industrial leasing activity in Metro Vancouver is expected to remain active in all segments of the market into 2015 (particularly in the wake of select larger users agreeing to occupy space in the near term), these recent developments should increase product choice to tenants of all sizes who are seeking to expand throughout the market. This activity will direct new demand to those projects currently under construction or consideration. Barring a hike in interest rates, industrial acquisitions by users and institutions is anticipated to remain nominal in the next six to 12 months due largely to supply constraints. Despite a lack of available stand-alone product to purchase, a comparatively significant number of potential relocation options for lease will be available to tenants of all sizes and dispositions with overall market fundamentals remaining healthy. 

Vancouver Industrial Team Kyle Blyth 604.647.5088 [email protected]

John Lecky 604.647.5061 [email protected]

Caitlin Cramb 604.647.1332 [email protected]

Bennett Lutes 604.646.8382 [email protected]

Jeron Dillon 604.647.1330 [email protected]

Douglas McMurray 604.647.5082 [email protected]

John Eakin 604.646.8399 [email protected]

Gord Robson 604.647.1331 [email protected]

Michael Farrell 604.646.8388 [email protected]

Struan Saddler* 604.647.5077 [email protected]

Rob Gritten 604.647.5063 [email protected]

Dan Smith 604.646.8397 [email protected]

Kevin Kassautzki 604.646.8393 [email protected]

Mathew Sunderland 604.647.1346 [email protected]

Sean Keenan 604.647.1334 [email protected]

Terry Thies* 604.646.8398 [email protected]

Ryan Kerr* 604.647.5094 [email protected]

Matt Thomas 604.646.8383 [email protected]

Nabila Lalani 604.647.1342 [email protected]

Ian Whitchelo 604.647.5095 [email protected]

* Personal Real Estate Corporation

For more information please contact: Michael Keenan, Principal & Managing Director Direct Line: 604.647.5081 [email protected] Andrew Petrozzi, Vice-President, Research (BC) Direct Line: 604.646.8392 [email protected] Khushboo Wanchoo, Industrial Research Manager Direct Line: 604.647.1345 [email protected]

Avison Young Commercial Real Estate (B.C.) Inc. #2100-1055 W. Georgia Street Box 11109 Royal Centre Vancouver, BC V6E 3P3, Canada

avisonyoung.com © 2014 Avison Young Commercial Real Estate (B.C.) Inc. All rights reserved. E. & O.E.: The information contained herein was obtained from sources which we deem reliable and, while thought to be correct, is not guaranteed by Avison Young Commercial Real Estate (B.C.) Inc.