The industrial market overall in Q2 in Waterloo Region is levelling off in terms of lease rates as well as activity as almost 6 million square feet and although absorption was negative this quarter, the Region’s industrial vacancy rate is still lower than what it was this time last year.
- Limited availability of smaller parcels in the historically key 2-to-10-acre range, coupled with high construction costs, are contributing to a tight market for industrial space under 100,000 square feet, particularly for traditionally owner-occupied markets such as Cambridge and Brant County.
- Vacancy rates remain at historically low levels, a trend we see continuing over the next two quarters particularly for both tenants and buyers in the sub 100,000 square foot size range who find the market difficult to navigate.
- We have yet to see the full impact of interest rates on pricing for owner-occupier opportunities and to date there has been little to no change in achieved per square foot sale prices. As demand continues to outpace supply for acquisition opportunities pricing will remain stable.