When it comes to industrial sector property values, vendors have unrealistic expectations. That played a role in the lowest transactional dollar volume in the sector in Vancouver in three years, according to Avison Young. (For our part, we bought fewer industrial buildings because we were saving up for a iPhone 5.)

There were 60 transactions totaling just $83.6M in 2013, according to an AY report, the lowest dollar volume in the Vancouver industrial sector since 2010 ($80.1M). Fewer properties of scale transacted due to the declining availability of such assets, AY senior associate Struan Saddler tells us. A typical vendor isn't focusing on things like current market sale prices, cap rates, or development prices. Decisions to sell off are being impeded by the sight of large-scale, mixed-use development on the periphery of the industrial areas, he adds.

This 21k SF facility at 1362-1386 Venables St sold for $4M last fall. Vendors are "held hostage by the prospective ‘future’ value of these perceived radically changing areas,” Struan says. Some vendors are under the mistaken assumption their property can be rezoned for residential use. Then there’s the finite availability of land choking the pipeline, of which vendors seeking maximum return are well aware. Purchasers loaded up with low cost debt are also frustrated with the difficulty in finding a dance partner to close deals.