The amount of office space sitting vacant in Metro Vancouver has hit an 11-year high, fuelled by global economic uncertainty and a downturn in the commodity sector, according to experts.
Vancouver's downtown vacancy climbed to 9.8 per cent, its highest level since the end of 2004, and up from 6.4 per cent six months ago, according to Avison Young's semi-annual Metro Vancouver Office Market Report.
The data also shows a vacancy rate of 10.3 per cent for the larger Metro Vancouver area, the highest since the end of 2004.
Global economic factors to blame
"There seems to have been a pause in demand," said Brian Pearson, principal and office-leasing specialist at Avison Young.
A significant portion of the tenants in the downtown core are commodity-based companies, many of whom are now facing economic hardship because of global conditions, according to Pearson.
They may be consolidating operations at foreign headquarters or may simply be reducing their office space in an effort to cut costs, Pearson said.
"Demand for office space really is a function of overall economic health."
Pearson said it's unlikely that companies are choosing to relocate because their employees cannot afford to live in the Metro Vancouver area.
"I don't see a correlation between cost of residential real estate and demand for office space in Metro Vancouver."