Canadian warehouses packed

From “With Warehouses Packed, Canada’s Logistics Industry Is Straining” (Bloomberg):

Canada is projected to have the strongest growth in the Group of Seven this year, and a large majority of businesses already say they would struggle to cope with any unexpected increase in demand. One visible manifestation can be found in the huge industrial buildings that line the highways of the suburbs around Toronto and Vancouver.

For-lease signs are vanishing and “everybody’s warehouse is packed,” says trucking executive Murray Mullen, who runs Mullen Group, one of Canada’s largest logistics firms.

Across the nation, the availability rate for industrial real estate in major markets has shrunk to 2.2%, from almost 3% a year ago, according to Altus Group. In Toronto and Vancouver, it’s around 1%.
In some municipalities near the Port of Vancouver, there is not a single square foot of vacant industrial space, according to Colliers International.

Delays and disruptions in the global supply chain have prompted a reversal of the lean-inventory model that broke down in the early months of the pandemic.
Companies are “buying stock not three weeks, not three months, but six months ahead of time and storing it somewhere,” says Martin Imbleau, chief executive officer at the Montreal Port Authority, which has pitched itself as a less-busy alternative to clogged eastern ports.

The squeeze means that, in addition to paying more to ship goods, companies also have to pay ever-higher premiums to store them.
The total cost of leasing industrial space in Vancouver has risen 40% in three years, according to Altus.

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