Richmond continues to attract companies based on its centrality within the Metro Vancouver region, as well as its accessibility to transit and the Vancouver International Airport. The outlook for the Richmond office market remains optimistic due primarily to two factors which have only recently affected the area:

There has been no new supply in the Richmond submarket since the introduction of 211,000 square feet of supply in 2008. Furthermore, no new supply is anticipated over the next 2 years. Given ongoing population and employment growth, Richmond’s relatively affordable office rents will appear increasingly attractive.

The completion of the Canada Line in 2009 greatly increased Richmond’s accessibility not only to the City ofmVancouver, but within the entire region. With 4 centrally located stations, the line is an important piece of infrastructure that will benefit the Richmond office market, particularly those buildings located in and around the City Centre area.

Richmond’s overall office vacancy rate was 21.2% in Q1 2011, down slightly from the previous quarter. Ongoing vacancy has persisted in large part due to low levels of leasing activity combined with new suburban product.

For strata office sales, there are basically two markets: suburban office parks, and urban office buildings in the City Centre area. These two groups exhibit very different pricing, but both are increasing at a steady rate.

Allied REIT has acquired 948 Homer Street, a 4-storey office building located in Yaletown. The building is 45,321 square feet and was built in 1931. It features high ceilings and openable windows. The purchase price was $18,500,000, representing $408 per sq ft.

This is Allied REIT’s second office building acquisition in Vancouver after acquiring 840 Cambie Street earlier this year.

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Anthem Properties has acquired 190 Alexander Street, ‘The Harbourview’, a 6-storey, 40,000 sq ft office building located at Alexander Street and Hastings Street on the edge of Gastown in Vancouver, B.C.

The purchase price was $10,375,000 representing $262 per sq ft. The building is reinforced concrete and was built in 1979. It features excellent views of the North Shore.

The College of Physicians and Surgeons of British Columbia has bought seven floors of space in a new Vancouver office tower in what is believed to be the largest office sale to a single user in the city’s history.

The group bought the space in the Offices at Hotel Georgia, part of a $450-million redevelopment of the 84-year-old Hotel Georgia that includes another two floors of as-yet unsold office space as well as 156 condo units.

The deal was worth just under $30-million.

Delta Land Development Ltd. is building the project, and Avison Young brokered the deal. The College plans to move its 90 employees into the space by the end of the year.

“It has always been the vision of the board to own rather than lease office space,” the College said in a statement. “The finance and audit committee considered 24 buildings in Vancouver and Burnaby before making its final decision.”

The strata space – where ownership is comparable to a condo – was bought to avoid future rent increases in a pricey market. It also means the organization won’t have to pay HST on leasing costs.

Source: Globe and Mail