The occupancy turn is real; the rent turn is a 2027 story. REIT Stack Research reads Q1's near-sweep of first vacancy declines in three years as the cycle floor forming — while composition and concessions keep the asking-rent print drifting for another year.

Interest rates

A seventh straight quarter below $20, but the slide is flattening: brokers put the average net asking rent between $18.98 (Cushman & Wakefield, down 1.3% quarter-over-quarter and 10.3% off the $21.15 peak of 2022-2023) and $19.81 (Avison Young, excluding $7.07 psf of additional rent), with CBRE noting its quarterly decline slowed to just 0.7%. The brokers largely agree on the cause: as premium space leases up, what remains skews older — Colliers states the declines 'reflect the current composition of available listings rather than weakening demand.' The concession file is the caveat: Cushman & Wakefield reports landlords offering discounted first-year rents 'reaching reductions of up to $10.00 psf,' and Avison Young has additional rents above $7 — lower quarter-over-quarter but still up 8% year-over-year. The submarket spread tells the same quality story: Richmond, tightest at 3.3% vacancy, commands $20.42, while Delta and Surrey sit at $18.20 and $18.30.

Vacancy

For the first time in three years the direction changed at most desks: Cushman & Wakefield has overall vacancy down 10 basis points to 4.4% — the first decline since Q4 2021 after twelve straight quarterly increases — Avison Young down 40 bps to 4.1%, its first decrease after 14 consecutive quarters, Lee & Associates down 10 bps to 4.5% after its own 14-quarter climb, and Colliers down 50 bps, 'the largest quarterly drop since pre-COVID,' with its availability rate holding flat at 4.4%. CBRE is the dissent: its availability rate rose 30 bps to 6.3%, a fourth consecutive increase, driven by the small- and mid-bay segments, with vacancy at 5.1%; JLL reads 4.5% vacancy against 6.1% availability. One underappreciated positive on Cushman & Wakefield's count: vacant sublet space — which had risen for two years — fell for a third straight quarter, to 1.19M sf from 1.24M sf.

Demand

New leasing hit 2.78M sf excluding renewals on Cushman & Wakefield's count — up 50% quarter-over-quarter and 11% year-over-year, the strongest quarter since Q1 2022 — with twelve new leases over 50k sf accounting for 1.04M sf, and five of the quarter's fourteen large-format deals landing in Delta. Net absorption was positive on every broker's measure — spanning CBRE's 30,788 sf to Colliers' roughly 1.15M sf, which 'nearly doubled that of new supply' — driven in part by pre-leased tenants taking occupancy, including GoodCang Logistics at 8151 Churchill Street (110k sf) and Getpaq at 7510 Hopcott Road (103k sf). Third-party logistics is doing the heavy lifting: Colliers reports 3PLs 'have been absorbing many of the larger-bay availabilities' while small- and mid-bay demand stays slower, and the number of vacant availabilities over 100,000 sf was cut in half between Q4 2025 and Q1 2026. The quarter's marquee deals: D-Home International Logistics' 214,844-sf sublease at 18899 28th Avenue in Surrey and Rexel Canada Electrical's 132,927-sf headlease at 4449 Salish Sea Way in Delta.

Supply

The pipeline is thin, committed, and — new this quarter — no longer shrinking: estimates of space under construction cluster between roughly 2.5M sf (Colliers) and 3.4M sf (Cushman & Wakefield, after just over 1.2M sf broke ground — still the second-lowest quarterly level in its past decade). Deliveries were minimal — 574k sf on Cushman & Wakefield's count, the lowest since Q3 2024, 62% pre-leased or pre-sold, leaving only 217k sf of new vacant supply — and what is being built is overwhelmingly spoken for: 67% of Cushman & Wakefield's 2026 pipeline is pre-committed, CBRE has just under 70%, and Avison Young puts build-to-suit at 71% of construction activity with speculative and strata starts collapsing from 63% of 2025's square footage to 22% in Q1. The 24.8M-sf proposed pipeline remains gated on pre-lease and pre-sale requirements, though Cushman & Wakefield notes rising land-holding costs may pressure some developers to move forward regardless.

Cap rates

Vancouver remains the tightest industrial yield market in Canada: Avison Young's national survey has new product at 4.85% versus 6.40% in Edmonton and 5.50% in Toronto, with mature multi-tenant at 5.50%; Lee & Associates reports a 4.20% average; and CBRE's survey puts Class A at 4.50%–5.25%. Colliers' national read is that industrial cap rates 'have not changed significantly over the past year,' with the Bank of Canada's target rate unmoved since October 2025 and inflation risk — gas prices up 50% from the start of the year — keeping the possibility of an increase on the table. On the sales tape, Cushman & Wakefield counts roughly $228M of freestanding industrial sales at an average $534 psf, down about 4% quarter-over-quarter and 8% year-over-year as the bid-ask gap narrows, while Lee & Associates' own series edged up to $495 from $487 psf; the quarter's marquee trade was the $53.3M, roughly $502-psf sale of 5085 North Fraser Way in Burnaby.