The area, on the northern border of East and West Side Vancouver, has long been known for its inexpensive and low-rise industrial building

Last year, however, the City of Vancouver changed the light industrial definition in the area to allow the mixing of office space with industrial use. Zoning allows three square feet of commercial space to be erected for every square foot of land occupied.

Since the change was implemented, Mount Pleasant industrial land prices have hit the highest level in all of Metro Vancouver, at $384 per square foot, up about 34 per cent from 2007.

Some recent sales are already well above the average: one buyer paid $500 per square foot for an old one-storey industrial building on West 3rd Avenue in Mount Pleasant, a survey from Avison Young reveals. Another buyer paid $3.1 million for less than 7,500 square feet of industrial space in the 300 block of West 6th Avenue.

The density change has transformed what would typically be considered industrial transactions into land deals, according to Avison Young, which has been tracking action in the area.

“The higher pricing has essentially rendered retaining the existing structures as an inefficient use,” the report stated.

Growing demand for Mount Pleasant property has resulted in tech firms and other so-called light industrial users competing with developers and private investors trying to acquire property, the commercial agency noted. “This activity and subsequent pricing has skewed the overall value of Vancouver industrial real estate transactions,” Avison Young said.