We’ve talked a lot about the risks of sharply rising residential land prices here, but what about industrial land prices? Mark sends in the link to this article about the rising cost of urban land driving industry east.
“Our industrial land prices are probably the highest in North America and certainly the highest in Canada,†Heed said.
The high prices reflect both soaring demand and the fact that Metro Vancouver has virtually run out of industrial land. The vacancy rate has plunged to 1.3%, while industrial land rezoning has virtually stalled.
“Companies, big employers, have options in Alberta,†Heed warned a National Association of Industrial and Office Properties (NAIOP) meeting in Vancouver last month.
He said that in Calgary, 3,000 acres of serviced industrial land will come to market this year and, by 2009, the city will have 5,000 acres of industrial land ready to develop.
“That’s where the business will be heading unless something is done,†he said. “In 10 years, we will be in serous trouble.â€
..That hasn’t happened yet though, despite the high cost of land there’s still industrial development going on:
More than 3.5 million square feet of industrial space is under construction.
Speculators are also apparently still interested in the Metro industrial sector.
According to Colliers, all five of the major industrial sales during the second quarter of this year were to investors.
