Nanaimo's Boban Dr. is one of Nanaimo's several busy industrial areas. (Ian Holmes/NanaimoNewsNOW)

By Ian Holmes

low supply

New report shows extreme industrial land shortage in Nanaimo, surrounding area

Dec 5, 2023 | 12:04 PM

NANAIMO — As the region’s population increases, valuable industrial land availability shrinks.

A new report from commercial real estate firm Colliers International showed in the third quarter of 2023 the vacancy rate for industrial building space within Nanaimo city limits was a paltry .71 percent, down from 2.4 per cent the year prior.

Published regularly since 2020, a regional industrial inventory analysis by Colliers showed space availability in the sub one per cent range in Nanaimo in three of four years of reporting.

A severe lack of industrial stock is a fact the City of Nanaimo is well aware of.

“It’s a tight market for industrial land and we’re not surprised by those numbers,” the City’s director of development approvals Jeremy Holm told NanaimoNewsNOW.

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Low supply factored into driving up the cost of industrial rental rates in Nanaimo, with Colliers reporting a 33 per cent surge compared to the fall of 2022.

Few industrial space openings is far from a Nanaimo-specific problem in the region.

Colliers’ latest data showed vacancy rates of residential buildings of 1.1 per cent in Parksville/Errington and 2.2 per cent in Ladysmith/Chemainus.

Citing Colliers helped identify the need for additional industrial supply during its new Official Community Plan (City Plan) document approved last year, Holm said supply to satisfy long-term demand is expected to be realized.

Short-term, while low supply is expected to persist, Holm said a bit of relief is expected.

“There are some lands that we do see with the potential to develop: South Wellington area, there’s also industrial lands on the west side of the Nanaimo Parkway between Northfield and East Wellington Rd. that have potential to come online.”

In light of the City Plan process, Holm said additional land for industrial purposes were set aside in the southeast corner of the city in the Cable Bay area, which was previously zoned for resort use.

Longer term relief is expected due to a significant influx of supply from the approved Sandstone development to take shape in the years and decades ahead in south Nanaimo, Holm stated.

He noted in some cases more efficient use of existing industrial land could add more space availability, however he said that’s dictated by land owners and market demand.

Holm said ensuring the Nanaimo area continually increases its industrial supply is vitally important.

“We have key players in the community and being the hub that we are, the port that we are, there are needs for larger industrial facilities to support the transportation supply chain and to meet changing demands”

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Ian.holmes@pattisonmedia.com

On Twitter: @reporterholmes