If you want a clean, simple story about Vancouver real estate, you probably will not get one.
At last week’s Vancouver Real Estate Forum, two ideas kept bumping into each other. Local B.C. companies said the province often feels hostile to investment. At the same time, national and global firms talked about Vancouver like a market they still very much want to be in.
That tension matters because it tells you something important about how real estate capital works. A market can be frustrating to operate in and still attractive to own. In fact, those two things often show up together.
Vancouver is a good example. It is expensive, tightly regulated, physically constrained, and slow to add supply. Those facts make life harder for local developers and operators. They also make existing assets more valuable to long-term investors who can tolerate short-term pain.
So what is really going on here? Why are some people saying B.C. is investment-unfriendly while others are buying anyway?
One of the clearest messages from the forum was that “Vancouver” means different things depending on who you are.
If you are a local developer, owner, or operator, you deal with costs and friction every day. Permitting delays, taxes, fees, shifting policy, financing pressure, and construction costs are not abstract issues. They hit your spreadsheet immediately. They can kill a deal that looked viable six months earlier.
If you are a national pension-backed investor, a private equity firm, or a global asset manager, your view is wider. You are asking different questions. Is this city economically resilient? Is the legal system stable? Is supply hard to add? Will well-located assets still matter in ten years? If the answers are yes, the market can still look appealing, even if the local process is maddening.
That is why both camps can sound sincere while saying almost opposite things.
CBRE Canada’s Jon Ramscar captured the bullish side when he said sophisticated investors choose Canada, quality capital is re-engaging, and Vancouver’s fundamentals remain strong. In his view, Vancouver does not need a huge demand surge to perform well because supply is so constrained.
That last point is worth sitting with for a second. In a market where adding new product is difficult, even modest demand can support rents, occupancy, and asset values. It is not magic. It is simple scarcity.
There are a few reasons Vancouver continues to draw attention even when people on the ground sound exhausted.
This is the most obvious one, and probably the most important.
Vancouver has natural constraints, such as mountains, water, and limited land. It also has man-made constraints, including zoning limits, entitlement delays, and a development process that many local firms see as too slow and too uncertain.
Usually, people talk about supply constraints as a housing problem, and they are right. But it is also an investment story. Scarcity tends to support existing assets, especially in sectors where demand keeps showing up.
That helps explain why global investors still view Vancouver as a place where high-quality real estate can hold value over long periods.
When large investors compare cities, they are not only comparing rent growth. They are comparing political systems, legal frameworks, financing conditions, currency risk, and market transparency.
Canada usually scores well on those things, and Vancouver benefits from that broader reputation. Jason Yong of Brookfield said his firm has been trying to get back into Canada and Vancouver because Canada is one of the more stable capital markets and Vancouver remains one of the country’s few major urban markets with long-term relevance.
That kind of comment is easy to dismiss as corporate optimism, but I think it reflects a real habit of institutional capital. Big money does not always chase the cheapest market. Often it chases the market that still feels governable.
Another sign of renewed interest came from lending data. In CBRE’s annual Canadian Real Estate Lenders’ Report, lenders identified Vancouver as the top market in the country for lender appetite, ahead of Toronto for the first time in a decade.
That is not a small signal.
When lenders want to be active in a market, transactions become easier to finance, refinancing becomes less painful, and buyers can underwrite deals with a bit more confidence. It does not mean all projects pencil. Far from it. But it does suggest that debt providers believe Vancouver has enough depth and resilience to justify exposure.
In real estate, sentiment matters. Lender sentiment matters even more.
Another useful takeaway from the forum is that “Vancouver real estate” is too broad a phrase. Different sectors are behaving very differently.
Ramscar called industrial “as close as a sure thing as you can get.” That sounds bold, but the logic is familiar.
Industrial space in and around Vancouver benefits from limited land, port access, population growth, last-mile delivery demand, and the need for logistics space close to consumers. Janice Lin of Blackstone also pointed to industrial strength, noting that Pure Industrial had its best leasing year since being taken private in 2018.
She also linked Vancouver’s industrial prospects to AI-related demand and the continuing importance of last-mile delivery. AI gets talked about a lot, often too loosely, but in this case the point is practical. More data infrastructure, more distribution needs, and more pressure on supply chains can all feed demand for industrial property, directly or indirectly.
This does not mean every warehouse is a winner. Pricing still matters. Location still matters. Functional design still matters. But industrial remains the sector that seems to attract the least debate.
Purpose-built rental also looks attractive, especially for investors who want durable income in a city with chronic housing shortages.
One concrete example came from Realstar, which acquired three relatively new east Vancouver rental buildings from PCI Developments: Yarrow, Aster, and 388 Kaslo. The appeal, according to Realstar CEO Randy Hoffman, included the submarket itself and the fact that the seller was a quality developer.
That may sound ordinary, but it is actually revealing. Institutional buyers are being selective. They are not simply buying “Vancouver.” They are buying specific submarkets, newer product, and assets with strong operating histories.
BGO’s Simon Holmes made a similar point in a different way. He said investor confidence is back in a significant way and that the firm continues to look at new multifamily opportunities in markets less affected by condo oversupply, such as Victoria.
That distinction matters. Rental housing can be attractive while the condo market is under pressure. They are related, but they are not the same thing.
Office produced the widest range of opinions.
Ramscar said office investment in Vancouver remains below historic norms. That fits what many people already suspect. The sector has not fully found its footing after the post-pandemic reset, and capital is more cautious.
Still, BGO’s recent acquisition of Oceanic Plaza shows there is demand for the right office opportunities. Buyers are not ignoring the sector. They are just being picky.
Chuck We of Hudson Pacific Properties was the least enthusiastic panelist on Vancouver office. His view was that better opportunities can be found elsewhere along the West Coast, where some properties are trading at 40 to 50 per cent below replacement cost.
That phrase, “below replacement cost,” is worth unpacking. It means a buyer may be able to purchase an existing building for much less than it would cost to build a similar one today. For bargain hunters, that can be compelling. It can also be a warning sign if weak tenant demand keeps values depressed.
Even so, We still rated Vancouver a seven out of ten as an investment market. That feels about right for office in Vancouver right now. Not terrible. Not easy. Very dependent on basis, asset quality, and leasing strategy.
Retail got a more cautious read, with talk of rising insolvencies. That does not mean retail is doomed. Good grocery-anchored centres and well-located necessity retail can still perform. But weaker tenants and consumer strain create real risk.
Land was described as “not for the faint of heart,” which is probably the cleanest summary of development land in Vancouver today.
Land values, financing costs, policy changes, approval uncertainty, construction pricing, and end-user affordability all collide there. You can make money in land. People do. But it takes conviction, patience, and a much stronger stomach than a lot of investors currently have.
This is the part I find most telling.
Todd Yuen of Beedie, the only B.C.-based panelist in one investment session, said he thinks the climate in B.C. needs to be more business-friendly. That comment did not sound unusual at all. If anything, it echoed a familiar local complaint.
Why does that frustration sound louder among B.C.-based companies?
Because local firms live inside the process. They are hiring contractors, carrying land, negotiating with municipalities, dealing with policy changes, and trying to keep projects alive while costs rise. For them, “investment climate” is not a theory. It is a daily operational condition.
Large external investors often interact with Vancouver later in the chain. They buy stabilized rental assets, leased industrial buildings, or office towers at adjusted pricing. They may inherit the scarcity without having to suffer every step of creating it.
That gap in experience is a big reason the narratives diverge.
It would be a mistake to hear “capital is back” and assume everything is suddenly easy again.
The deals and comments discussed at the forum suggest something more nuanced. Capital is returning, but it is choosy.
It likes:
newer rental buildings in proven submarkets
industrial assets tied to logistics demand
multifamily in markets where supply pressure is manageable
office only when pricing and asset quality make sense
stable, core assets in a city with long-term scarcity
It is less eager about:
speculative land positions without clear economics
weaker retail exposure
office assets that need heroic assumptions
projects that depend on perfect execution in an imperfect regulatory environment
That distinction matters for anyone trying to interpret headlines. A few high-profile acquisitions do not mean the whole market has healed. They mean buyers see openings in certain corners of it.
Real estate forum coverage often tosses around jargon, so it helps to translate some of it.
This means how willing banks and other lenders are to provide debt in a given market or asset class. More appetite usually means more liquidity and more competition among lenders.
“Core” capital usually targets lower-risk, stabilized assets in strong locations. “Core-plus” takes a bit more leasing, operational, or market risk in exchange for somewhat higher returns. When Blackstone describes Vancouver as attracting very core or core-plus capital, that suggests investors still see it as a relatively safe place for institutional money.
Realstar’s acquisition was completed through a share sale, meaning the buyer acquires ownership of the company or entity that holds the asset rather than purchasing the asset directly. These structures can have tax and transaction advantages depending on the situation.
This is what it would cost to build the same property today, including land, materials, labour, soft costs, and financing. Buying below replacement cost can be attractive, but only if the property also has a realistic path to income and occupancy.
The biggest lesson is simple: Vancouver can be both hard to work in and attractive to invest in.
That is not a contradiction to solve. It is the market.
Local operators are not wrong when they say B.C. feels unfriendly to business. Institutional buyers are not wrong when they say Vancouver still has excellent long-term fundamentals. They are looking at different slices of the same place.
If you are trying to read the market, a few points seem clear.
First, scarcity still matters. Probably more than ever.
Second, external capital has not returned in a carefree way. It has returned with a checklist.
Third, the spread between asset classes is wide. Industrial and rental housing attract confidence for reasons that are easy to explain. Office needs a sharper pencil. Land needs patience and nerve.
And finally, Vancouver’s appeal is not really about hype. It is about endurance. Investors with long time horizons still see a city with limited supply, meaningful economic relevance, and enough institutional trust to justify commitment.
That does not make every deal good. It does make the city hard to ignore.
The next phase will probably be less about speeches and more about proof.
Watch whether lender appetite turns into more closed transactions. Watch whether multifamily buying expands beyond the best assets. Watch whether office trades pick up or remain isolated. Watch industrial leasing, because that sector has carried a lot of optimism. And watch whether B.C. policy becomes easier to navigate for people actually trying to build.
If those local conditions improve, Vancouver could become more than a market that investors like owning. It could become a market more people are willing to create in.
That would be a meaningful shift. Right now, the city still feels split between those two realities.
