
By Winkie Chan and Pavneet Grewal
In recent years, uncertainty has been a defining characteristic of the Metro Vancouver real estate market, leaving developers and investors grappling with shifting economic and regulatory landscapes. In this climate, staying informed is critical. Our commercial real estate team actively engages with the industry to stay informed on market trends and the challenges that our clients are facing. Most recently, our team was in Whistler to connect with attendees of the International Council of Shopping Centers’ ICSC@Whistler conference, which was held while we attended and sponsored the Urban Development Institute’s (UDI) Annual Industry Forecast Luncheon with a speaker panel featuring Daryl Simpson of Townline, Eric Carlson of Anthem, Intracorp’s Evan Allegretto, and Nch’Kay Development’s Jennifer Podmore Russell.
At the UDI Luncheon, the speakers identified three major industry challenges in their forecasts for 2025: government policy impacts, shifts in the rental housing market, and the availability of capital in a high-interest-rate environment. These same challenges were expressed by those we connected with at ICSC, and below are the key takeaways.
Government Policy and Market Stability
Government policies—both local and federal—are playing an increasingly pivotal role in shaping market dynamics. At the municipal and provincial level, affordable housing remains a primary focus yet rising construction and capital costs are creating a disincentive for new developments. Predictability in policy-making remains a key concern for developers looking to take on new projects.
On the federal front, shifting economic policies and immigration trends are contributing to market uncertainty. Additionally, ongoing trade and tariff discussions are contributing to inflation concerns, further complicating long-term investment strategies.
Rental Housing Market
A notable trend discussed is the evolving rental housing demographic. With more affluent tenants choosing to rent long-term, developers may need to reconsider their approach to rental property development, focusing on higher-end amenities and community-driven living experiences.
This year also marks a potential shift in population growth trends, with some experts forecasting a modest population decline. While some panelists predict a slowdown in new rental and condominium projects, others maintain a more optimistic view. Regardless of these differing perspectives, the panelists seemed aligned in their forecast that rental rates will stabilize or decline slightly in the near term.
Lack of Capital
One of the most pressing concerns for developers remains the availability of capital. Persistently high interest rates have made securing financing increasingly difficult, leading many investors to adopt a cautious, wait-and-see approach. Consequently, some projects have been delayed or shelved altogether due to financial feasibility concerns.
Looking ahead, there is cautious optimism that capital availability may improve in late 2025. Interest rate stabilization could ease financing pressures and reinvigorate development activity.
Strategic Planning for 2025 and Beyond
As we move further into 2025, the key to success in real estate development will be adaptability and informed decision-making. Developers and investors must closely monitor policy developments, market trends, and financial conditions to align their strategies with emerging opportunities.
Clark Wilson remains committed to providing timely insights and strategic guidance to help our clients navigate these complexities. Whether assessing new investment opportunities or mitigating risks in ongoing projects, our team stands ready to support you in making well-informed decisions in a dynamic market environment.
For more information on how current market trends may impact your real estate ventures, feel free to reach out to our team.