Although it fell in this year’s rankings, Vancouver remains a popular destination for tech talent, including artificial intelligence (AI) specialists, which will continue to support real estate market fundamentals, according to a new report from commercial real estate services firm CBRE.
Total tech occupations in Vancouver grew 30.7 per cent from 2018-23, with the local tech sector now employing 98,700 workers at an average wage of $109,990, CBRE said in its Scoring Tech Talent 2024 report released Wednesday.
There is increasing demand for AI software and hardware developers, and Vancouver’s tech employers are aggressively adding AI-specialty workers to their ranks. Toronto, Vancouver and Montreal are now the leading AI-development markets in Canada, accounting for 60 percent of the country’s AI-specialty tech jobs, the report said.
This trend will likely bolster Vancouver’s residential and commercial real estate markets.
“Artificial intelligence is a transformative technology with high potential to become a major source of economic growth and real estate demand,” said CBRE’s report.
Vancouver actually fell in this year’s ranking of North American tech markets by CBRE, which uses 13 metrics to measure each market’s “depth, vitality and attractiveness to companies seeking tech talent and to tech workers seeking employment.”
This year, Vancouver fell to No. 11 from No. 8 despite adding 23,200 tech talent jobs over the past five years.
Vancouver’s drop in the rankings is misleading, said Blair Quinn, who heads the High Technology Facilities Group at CBRE Vancouver.
“There’s a lot of good news in this story,” he said. “Everyone is going to focus on the drop, but we don’t see the retraction of the sector being a local issue. We see it as more of a U.S. and global tech retreat effect.”
In Canada, tech talent jobs increased by 1.7 per cent or 18,400 last year, and there is strong growth in AI specialties, including in Vancouver.
“AI is infiltrating every business,” said Quinn. “Vancouver is well-positioned to take advantage of that. We are in the top 11 of AI tech talent in North America. For a smaller market that’s pretty impressive, so we’re in the right place on that front.”
The commercial office market will continue to benefit from Vancouver’s high-tech industry, with a 20-per-cent increase in rents and a 9.4-per-cent vacancy rate. However, tech companies are reassessing their office needs as remote and hybrid work arrangements become more common, with some employers reducing their portfolio sizes accordingly. On the residential side, apartment rents have already recovered to pre-pandemic levels.
“Technology’s importance in society and to real estate utilization has been accelerated and disrupted,” CBRE’s report stated. “This will create new opportunities for both real estate occupiers and investors in tech talent markets.”
