Vacancy rates in the Waterloo Region industrial market in Q3 2023 experienced a minor increase, although they remain under 1.0%. Therefore, despite the increase, finding suitable space for potential occupiers is still proving to be difficult.
- Scarcity is a bigger issue in the land market. Small parcels of development-ready land are in short supply. Hence, even though land prices have stabilized, they continue to stay out of reach for owner-occupiers.
- Construction projects are in full swing and with 1.7 million square feet of the 6.2 million square feet under construction scheduled to be completed over the next three to four months, this will lead to a dramatic increase in inventory as well as available space in the market.
- Interest rates have yet to impact owner/occupier prices and demand, but the time required for mortgage approval and associated hurdles are adding challenges in consistently getting deals across the finish line.