DEMAND SPRINGS BACK UA RENTAL TAKE - METRO VANCOUVER - Urban Analytics
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Q1-2021
UA RENTAL TAKE – METRO VANCOUVER
DEMAND SPRINGS
BACKOverall Rental Market
Increased demand for newer rental projects in the first quarter of 2021 provided evidence that the market is headed back in
the right direction. Although post-secondary classes are still being conducted online, there were more students moving
back to Metro Vancouver to live in the cities where they are attending school in anticipation of in-person classes being
reinstated in the fall. Young professionals who may have lost employment in early 2020 and moved back home have begun
to re-enter the rental market. Despite the economic impact of 2020, there are many industries in BC that have been thriving
of late, and as such a sizeable number of people have moved to the region for employment and are entering the rental
market. Many organizations still have office limitations in place and because working from home is still a reality for many
people, there has been higher reported interest in larger one-bedroom units or units that have a den that can be used as an
office. This is increasingly common in more sub-urban markets as the rent is more affordable on a per square foot basis in
these locations.
While overall average rental rates remained stable, it is anticipated that they will increase in the second quarter as more concrete
high rise rental product in urban sub-markets (Downtown, Vancouver West, Burnaby and Coquitlam) is released into the market.
TOTAL PROJECTS BY SUB-MARKET
33
31
26
21
14 14
12
7 7
5
2 1 2
Downtown Vancouver VancouverEast Richmond/S. Burnaby/New NorthShore Squamish Surrey WhiteRock Tri-Cities Ridge Langley Abbotsford
Vancouver West Delta Westminster Meadows
Chart 1
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021Urban Analytics is currently monitoring 175 newer purpose-built rental apartment projects comprising of 17,253 units
across 13 major Metro-Vancouver sub-markets. The first actively leasing project in South Delta is now being tracked and will
be included in the Richmond/South Delta sub-market. The data used for this analysis comprises of 61 newer concrete rental
apartment buildings, 111 newer wood frame rental apartment buildings and three newer rental townhome projects. The data
is gathered on an ongoing basis through primary research methods. The information is then consolidated and entered in
UA’s proprietary NHSLive data platform, which is available to industry stakeholders on a subscription basis.
Active vs. Fully Leased Projects
UA considers a rental apartment project in its initial lease-up campaign as ‘actively leasing’. Once a project completes its
initial leasing campaign and has rented all units, the project is considered ‘fully leased’, and subsequent turnover is
monitored monthly. There were six total projects in four different sub-markets that launched in the first quarter of 2021.
Notable project launches during the first quarter of 2021 included Chard Developments’ The Royals (West Building) (152
units) in North Vancouver, Centurion Property Associates Metro (107 units released of 514 total units) in Surrey, and
Sonnenberg Home Builders’ townhouse development The Post (24 units released) in Ladner. Six rental developments also
became fully leased in the first quarter.
ACTIVE VS FULLY LEASED PROJECTS
Downtown Vancouver 88%
12%
Vancouver West 91%
9%
Vancouver East 87%
13%
Richmond/ S. Delta 80%
20%
Burnaby/New Westminster 93%
7%
North Shore 71%
29%
FULLY LEASED
Squamish 0%
100% ACTIVE
Surrey 43%
57%
White Rock 100%
0%
Tri-Cities 86%
14%
Ridge Meadows 100%
0%
Langley 93%
7%
Abbotsford 75%
25%
Chart 2
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021Decreased Overall Availability
Overall purpose-built rental availability decreased by 1.1 in the first quarter of 2021. Only 466 new rental units were released
to the market during the quarter, which made it easier for the overall availability total to come down. Availability in fully
leased buildings also declined by 0.4 percent compared to the previous quarter. The overall availability total is anticipated to
increase significantly in the second quarter as an estimated 1,600 units could finish construction and begin leasing
campaigns within the next three to six months. Leasing managers throughout Metro Vancouver have noted that demand has
picked up in the first quarter with more students and young professionals re-entering the rental market. Demand is
anticipated to increase throughout the remainder of 2021 as post-secondary schools plan on holding in-person classes in
September and most British Columbia residents will have had their first vaccinations by July/August. Availability in the above
chart includes both units in actively leasing projects and units in fully leased projects.
AVAILABILITY PER QUARTER
12.0%
10.0%
8.0%
5.6%
6.0% 4.9%
5.2% 4.0%
5.3%
4.0%
2.0% 3.7% 4.2% 3.8%
3.2%
2.3%
0.0%
Q1-2020 Q2-2020 Q3-2020 Q4-2020
FULLY LEASED TURNOVER AVAILABILITY FROM ACTIVE PROJECTS
Chart 3
Availability Increase in Urban Areas
The chart shown below helps illustrate the impact of COVID-19 on the different sub-markets in the region since the first
quarter of 2020 and displays available inventory in previously fully leased buildings. Availability increased in all Vancouver
locations (Downtown Vancouver, Vancouver West and East). Most of the current availabilities in the Vancouver West sub-
market are located at UBC. Conversely, availability in Surrey, Tri-Cities, Ridge Meadows and Abbotsford has declined since
early 2020.
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021FULLY LEASED AVAILABILITY BY SUB-MARKET
8.6%
8.0%
7.2%
5.3%
5.0%
4.8%
4.5%
3.9%
3.8%
3.6%
3.6%
3.6%
3.4%
3.0%
3.0%
3.0%
2.9%
2.9%
2.9%
2.9%
2.8%
2.8%
2.8%
2.7%
2.7%
2.7%
2.7%
2.6%
2.5%
2.4%
2.4%
2.2%
2.1%
2.1%
2.0%
1.9%
1.9%
1.8%
1.7%
1.7%
1.7%
1.6%
1.5%
1.4%
1.2%
1.1%
1.1%
0.9%
0.9%
0.9%
0.8%
0.7%
0.6%
0.0%
0.0%
Downtown VancouverWest VancouverEast Richmond/S. Burnaby/New NorthShore Surrey Tri-Cities RidgeMeadows Langley Abbotsford
Vancouver Delta Westminster
Q1-2020 Q2-2020 Q3-2020 Q4-2020 Q1-2021
Chart 4 (Note: White Rock, and Squamish have been omitted due to a lack of historical data)
Rental rates remained relatively stable during the first quarter of the year with the most notable increase in per square foot
rental rates occurring in Surrey, which increased by $0.12 PSF compared to last quarter. The differential between the most
and least expensive sub-markets (Downtown Vancouver and Abbotsford) is currently at $1.88 PSF, which is up from the
$1.71 PSF differential recorded in the previous quarter. However, the reduction in the differential since early 2020 provides
an indication that renters in more cases are currently opting to rent in sub-urban locations as they offer more living space at
lower rental rates on average.
AVG NET RENT $PSF PER SUB-MARKET
$4.50
$4.00
$3.50
$3.00
$2.50
$2.00
$1.50
$1.00
$0.50
$-
Downtown Vancouver Vancouver Richmond/ S. Burnaby/New North Shore Squamish Surrey White Rock Tri-Cities Ridge Langley Abbotsford
Vancouver West East Delta Westminster Meadows
Chart 5
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021Overall average per square foot rents in the first quarter of 2021 were up by $0.01 compared to last quarter. Many leasing
teams and property managers are attempting to maintain current rents as they wait for post-secondary schools to re-open
later this year. There were very few projects that increased incentives or lowered rents during the first quarter. It was noted
during the first quarter that more people were starting to come back to the region and there was renewed interest in units
with dens or larger floorplans, which resulted in higher than anticipated demand. With multiple imminent launches
contemplated in Downtown Vancouver, Vancouver West and Burnaby, it is expected that the overall $PSF rents in the
region will increase in the second quarter of the year.
QUARTERLY AVERAGE $PSF RENTS
$3.24
$3.22
$3.20
$3.18
$3.16
$3.14
$3.12
$3.10
$3.08
$3.06
$3.04
Q1-2020 Q2-2020 Q3-2020 Q4-2020 Q1-2021
Chart 6
Chart 7 shows the asking rent per square foot for recently turned over units (by unit type) for newer purpose-built rental
projects in the region and compares them to their respective initial lease-up rates. Asking rents for turned over apartment
units have increased for all unit types and can be explained by the higher proportion of availabilities occurring in more urban
and expensive sub-markets.
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021RENTAL RATE CHANGES $PSF
$3.97
$3.91
$3.89
$4.50
$3.48
$3.47
$3.38
$3.33
$3.32
$4.00
$3.24
$3.20
$3.14
$3.05
$3.03
$3.03
$3.50
$2.73
$2.61
$3.00
$2.50
$2.00
$1.50
$1.00
$0.50
$-
Studio JR1 1 1+ JR2 2 2+ 3
INITIAL RENT $PSF Q1-2021 RENT $PSF
Chart 7
The following summarizes the increased rental rates (on a per square foot basis) in recently turned-over units relative to
initial lease-up rates (by unit type):
• Studio units: 17.4 percent higher
• Junior one bedroom units: 2.1 percent higher
• One bedroom units: 11.7 percent higher
• One bedroom plus den/flex units: 15.1 percent higher
• Junior two bedroom units: 2.5 percent higher
• Two bedroom units: 16.0 percent higher
• Two bedrooms plus den/flex units: 5.6 percent higher
• Three bedroom units: 0.5 percent higher
A portion of the rent increases can be attributed to buildings in the City of Vancouver that were initially leased at reduced
rates as required by the Rental 100 program they were approved under.
While overall rents remained steady throughout the quarter, there were some sub-markets that experienced increases.
Overall average per square foot rents were up by $0.12 in Surrey, up by $0.10 in the Tri-Cities and up by $0.09 in
Abbotsford. Average per square foot rents were lower in Richmond/South Delta and are the result of a new rental
townhome project in Ladner (with a much lower per square foot rental average) launching in the first quarter. Average
rental rate increases are likely to occur in the Burnaby/New Westminster and Ridge Meadows sub-markets as new
projects in these locations are anticipated to be launched at record high rents next quarter.
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021AVERAGE NET RENT $PSF PER SUB-MARKET
$4.50
$4.00
$3.50
$3.00
$2.50
$2.00
$1.50
$1.00
$0.50
$-
Downtown Vancouver Vancouver Richmond/ S. Burnaby/New North Shore Squamish Surrey White Rock Tri-Cities Ridge Langley Abbotsford
Vancouver West East Delta Westminster Meadows
Q1-2020 Q2-2020 Q3-2020 Q4-2020 Q1-2021
Chart 8
The chart below compares the proportion of available units to average per square foot lease rates for newer purpose-
built rental projects in Metro Vancouver. The overall average net per square foot rent has increased by 0.3 percent (or
$0.01 per square foot) and the overall unit availability has decreased by 1.1 percent over the first quarter. This is the first
time in five quarters where the availability rate has dropped while average per square foot rental rates have increased.
UA anticipates that this trend will revert to previous quarters where increased rents typically resulted in higher availability
rates as developers phase out incentives and increase rents for the remainder of 2021.
AVAILABILITY VS NET RENT $PSF
12.0% $3.24
$3.22
10.0% $3.20
8.0% $3.18
$3.16
6.0% $3.14
$3.12
4.0% $3.10
2.0% $3.08
$3.06
0.0% $3.04
Q1-2020 Q2-2020 Q3-2020 Q4-2020 Q1-2021
AVAILABILITY RATE AVG $PSF
Chart 9
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021Availability in Q1-2021
A new concrete apartment tower launch in the North Shore in early 2021 resulted in this sub-market now having the most
available new rental inventory in the region at 417 units. Available inventory in Surrey increased at the end of the first
quarter as a 110-unit apartment building was recently launched in this sub-market. A total of 816 newer purpose-build
rental units were available in the City of Vancouver at the end of Q1-2021. The below chart highlights the strong demand
and low availability in suburban locations – only 53 newer purpose-built rental units are available in Squamish, White
Rock, the Tri-Cities, Ridge Meadows, Langley, and Abbotsford combined.
AVAILABLE UNITS PER SUB-MARKET
417
347 338
131
109
77
32 40
1 0 4 1 7
Downtown Vancouver Vancouver Richmond/ S. Burnaby/New North Shore Squamish Surrey White Rock Tri-Cities Ridge Langley Abbotsford
Vancouver West East Delta Westminster Meadows
Chart 10
Incentives & Rental Trends
Incentives have been a large part of the leasing process for new rental developments in 2020 and early 2021. Many
buildings began to offer incentives in 2020 as they sought to retain high absorption levels throughout their respective
lease-up campaigns. Newer rental buildings are anticipated to phase out incentives throughout 2021 as it is assumed that
post-pandemic life will return to a more normalized level later on in the year. There are four concrete apartment buildings
that are anticipated to launch in spring 2021 that will not be offering incentives. A continuing trend that is still being used by
nearly all actively leasing and fully leased developments is offering virtual tours to perspective renters. This is an easy way
to qualify renters as leasing teams can prioritize conducting in person showings on more serious perspective tenants.
Leasing teams have reported that renters who request in-person viewings after experiencing the virtual showing have
converted into tenants at a higher rate.
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021Some examples of incentives currently offered in the marketplace include:
• $200 move-in bonus • 2 month free rent on select units
• $500 off first month rent • 2 month free rent on all units
• 1 year free internet, phone, and cable • Free parking and storage for six to 12 months
• 1 month free rent • Moving expenses paid by the landlord
• Class pack discounts and complimentary classes at
the in-building gym
Amenities
Amenity offerings are a significant part of what differentiates purpose-built rental developments from one another. Many
projects have successfully identified and executed amenities that appeal to different demographic groups in the
buildings and the communities they live in. Amenity offerings in newer purpose-built rental projects are being designed to
provide as much convenience as possible for the primary target tenant. An increasing number of new rental
developments are now incorporating parcel delivery systems as an amenity. Further, there is a new rental project
launching next quarter that will offer a refrigerated delivery room for residents. The following is a sample of amenities
offered by projects that launched during the first quarter of 2021 and the projects that will launch in the second quarter
of 2021:
• Rooftop courtyard • Carshareparking/cars • Lounge/games room
• Dog run • Fitness/yoga area • Daycare centre
• Dog wash station • Parcel delivery system • Co-work space
• Swimming pool • Kid’s play area • Garden plots
• Refrigerated Delivery Room
Looking Ahead
UA is currently monitoring 319 development applications for purpose-built rental projects across Metro Vancouver that
represent an approved total of 15,768 rental units. According to Urban Analytics’ contemplated tracking, there are
currently 29 rental developments with 3,834 units that are in the interior finishing stage of construction and are likely to
complete within the next six to nine months.
The following are some examples of new projects anticipated to complete in the next two quarters that UA will be
monitoring closely:
• The Moody – Woodbridge Properties (142 units)
• Everlea – Cressey Developments (201 units)
• Hazel – QuadReal (238 units)
• Inlet Station Apartments – PC Urban (229 Units)
DEMAND SPRINGS BACK - UA RENTAL TAKE - VANCOUVER - FIRST QUARTER 2021Given the ever-shifting conditions in the various sectors of the new home markets in Metro Vancouver, having access to
the most current and accurate data at your fingertips is more vital than ever. NHSLive provides timely data on the new
Land, Multi-Family Home, and Rental Apartment sectors of the market in Metro Vancouver. With its superior user-friendly
interface and extensive functionality, it has become an invaluable tool for over 1,200 industry stakeholder users. Call or
email us today to schedule a demonstration of NHSLive.
With the increasing competition in Metro Vancouver’s new purpose-built rental apartment market and the uncertainty in
the new condominium and townhome sector of the market, it is crucial to ensure your project is appropriately designed
and positioned prior to launching. Urban Analytics provides comprehensive advisory services that meet your firm’s
specific needs in all markets we service. Call or email today to ask how we can help.
URBAN ANALYTICS INC.
(604) 569-3535
info@urbananalytics.ca
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