Small businesses spur Burnaby industrial deals

Small and medium-sized businesses are driving an industrial real estate recovery in Burnaby, says a new Avison Young report.
Broker Kyle Blyth, who specializes in Burnaby industrial sales and leasing transactions, says small and medium-sized companies are helping to maintain the Vancouver suburb's traditionally stable conditions. Traditionally, after a downturn, he says, smaller industrial owner-users re-enter the market first and then larger companies come back.
Although Burnaby vacancy has notched up to 3% from 2.6% in the fall of 2009, it is still well below the Metro Vancouver average of 4.7%. Older properties needing renovation or redevelopment have slightly skewed Burnaby's rate upward.
But properties with high ceilings, good visibility and exposure, and easy access to arterial routes are in high demand. Meanwhile, landlords, well educated on market conditions, are offering new tenancies or retain existing ones.
Existing tenants will likely be able to capitalize on more favourable lease rates as they act on long-term needs that have been put off pending the global economic recovery.
In the few cases where developable land is available, developers will be asked to pay a premium. Lawrence Green, president of Spire Development Corporation can relate.
His company paid $1.4 million per acre for land where the new Spire Corporate Centre on North Fraser Way is located.
According to Blyth, strata-ownership projects, which help offset high land costs, are likely to increase. As the report notes, the Beedie Group, is also developing strata projects in South Burnaby.
Notable leases include Core-Mark International renewing on 70,000 square feet (sf) at 7800 Riverfront Gate while Mustang Survival (45,000 sf), Japan Foods (40,000 sf), Dynamex Couriers (30,000 sf) and Shoppers Home Health Care (20,000 sf) inked new rental agreements.