- Downtown Vancouver’s class AAA and A office vacancy currently sits at 12.9%, reflecting several years of major office completions delivered into a softer leasing environment. However, the development pipeline has come to a standstill. With no significant projects expected to add new high-quality inventory over the coming years, the market has entered a fundamentally different phase. Rather than asking how much vacancy new developments will create, the more relevant question is how quickly existing vacant space can be absorbed. Given the continued preference for premium office product, the answer may be faster than many expect.
- Using the 10-year average annual absorption rate of approximately 330,000 square feet and assuming no additional class AAA or A office supply is delivered in the next 3.5 years, vacancy would decline from 12.9% today to roughly 6.2% by 2029. Even under a more conservative scenario using only half of the historical average absorption, vacancy would still fall to approximately 10.0%. These projections suggest that the current vacancy challenge may be less a function of weak demand and more a consequence of the market continuing to digest the significant volume of high-quality office space delivered over the past five years. Importantly, much of that class AAA and A new supply has already been leased, demonstrating that demand for premium space remains intact despite broader market headwinds.
- Should leasing activity accelerate to 150% of the historical average, vacancy would fall to just 2.3% by 2029, a level typically associated with severe space constraints and rising rental pressure. The ongoing flight-to-quality trend has seen many occupiers gravitate toward newer, amenity-rich buildings, helping absorb much of the premium office space delivered over the past decade while older inventory faces greater leasing challenges. For tenants considering long-term real estate decisions, the current period of abundant choice among the market's highest-quality buildings may prove temporary. In a market where no meaningful new class AAA or A supply is on the horizon, today's vacancy could become tomorrow's shortage.
No new supply, big consequences: Vancouver’s office market faces rapid tightening
June 18, 2026