For most presale projects across Metro Vancouver, hitting the sales thresholds needed for construction financing has been a major task over the past 18-24 months. While the reasons for weak demand can be debated, I stand by my view: Canada’s slowing economy shows no real signs of turning around, further dampening optimism for the broader economy.
The presale market—like any capital-driven market such as stocks—thrives on the shared optimism buyers have for a stronger future and a growing local economy. The new Liberal government has hinted at a policy pivot to grow economic prosperity, so I’ll hold off on judgment until they’ve had time to show us a clearer path forward.
Caution has made its way into nearly every corner of the real estate market. From decade-high resale inventory to a growing supply of newly completed homes, buyer hesitation has frozen transactions. With demand for high-rise presales fading, many developers are now pivoting toward rentals. Land doesn’t sit for free, so for some, the shift is necessary just to keep projects moving forward.
The shift toward rental development in Metro Vancouver began a few years ago, notably in cities like Vancouver and Burnaby, where both policy and affordability pressures played a major role. Without getting too deep into it, land use policies began to both incentivize and require the construction of new rental housing. With condo prices climbing to unaffordable levels—upwards of $3,000 PSF in Vancouver and $1,500 in parts of Burnaby—paired with decade-high interest rates and rising immigration, rental quickly became the only truly viable source of new, buildable supply.
The Surrey Rental Development Trend
Unlike municipalities such as the City of Burnaby, which mandates rental through inclusionary zoning policies, the City of Surrey maintains a more open approach. While rental isn't required, Surrey does offer incentives—such as reductions in city fees—to encourage it. These cost savings help make rental projects more financially feasible. Combined with new provincial laws eliminating parking requirements in transit-oriented areas—which significantly reduce construction costs, as parkades are among the largest line items in a development pro forma—many developers have seized the opportunity to build rental in the city.
Two purpose-built rental high-rise towers have been completed since 2021, bringing hundreds of new rental units to the market:
- The Line by PCI at King George Hub – 371 units
- Locale by Century Group at Century City Holland Park – 243 units
Several others are currently under construction:
- Comma King George by Comma Properties (Rize) – 392 units, 38 storeys
- Parkway 1 – Aspect by Bosa Properties – 199 units
- King George Hub Phase 3 by PCI – 401 units, 41 storeys
More projects are in various stages of planning and development.
Some of these development applications date back to 2017–2018 and originally started as residential high-rise condos. As financing for rental construction became more accessible in the early 2020s, developers seized the opportunity to pivot. Driven by the same fundamentals that local presale investors rely on, developers recognize Surrey’s undeniable growth trajectory. With steady immigration, major campus expansions announced by UBC and SFU, and the SkyTrain extension now reaching Langley, the vision of Surrey as the region’s second downtown is becoming clearer.
The Boom of Presale Construction in Surrey and the Rise of New Inventory
This initial boom in rental development also coincided with a boom in condo construction. Nearly 11 high-rise condo buildings launched between 2021-2023 that have come up for completion recently or are set to complete this year. This equates to just over 4,000 new homes being added to the inventory in City Centre.
Another 5 high-rise buildings are under construction and set to deliver 1,841 new homes between 2026-2028:
- Georgetown 2 by Anthem Properties - 355 homes (2026 completion)
- Parkway 1 Aspect by Bosa Properties - 363 homes (2026 completion)
- Sequoia by ML Emporio - 386 homes (2027 completion)
- Parkway 2 Intersect by Bosa Properties - 396 homes (2028 completion)
- Juno by Streetside Developments - 351 homes (2028 completion)
As the market began to show signs of slowing around 2023, the launch of new presale projects quickly slowed too.
Several projects currently on the market have yet to break ground. In a slowing market, developers are getting creative to drive sales—whether it’s guaranteeing rental income or offering to buy back the unit at completion, the tricks are out to survive in this cycle. Some may even be considering reworking actively selling buildings, adding purpose-built rental to reduce the number of presales needed to secure construction financing.
The 2021 boom can be credited with bringing much-needed supply to the market. Today, it’s a buyer’s market, with plenty of homes to choose from. That added supply has also eased pressure on rental rates, as both purpose-built buildings and investor-owned condos have hit the market at the same time—putting tenants in a stronger position to negotiate.
City of Surrey’s Future High-Rise Supply Quickly Shifting to Rental-Only, Limiting Future Ownership Opportunities
The upcoming City Council meeting, scheduled for the week of June 23, 2025, offers a glimpse into the large-scale shift from condos to purpose-built rental currently underway.
Three high-rise towers—originally planned as either 100% condo or a mix of condo and rental—are now being redesigned as rental-only or majority rental. Developers have cited weak presale demand in Surrey City Centre as the reason for the shift.
Link to June 24, 2025 agenda: https://www.surrey.ca/sites/default/files/media/documents/AGN_RCLU_0.pdf
- 10240 City Parkway by CIBT Education Group – revised from 215 rental units and 168 condos to 387 rental homes
- 10073 137A Street by Tangerine Developments – revised from 379 strata condos to 100% rental
- 13866 100 Avenue (Sky Living) by Allure – revised from 449 condos to a mix of 207 rental units and 215 strata condos
This equates to nearly 801 additional rental units now planned for Surrey City Centre.
While today’s economic uncertainty may cloud optimism for many, history continues to show that real estate moves in cycles. What goes quiet eventually rebounds—and often stronger than before.
In my personal opinion, this strong pivot toward rental-only development reduces future ownership opportunities for the younger generation. While I fully support the need for more rental housing, I also believe in the long-term benefits of homeownership. Real estate is more than just shelter—it’s a pathway to financial stability and building wealth. Striking a balance between rental and ownership supply is key to building a more inclusive and resilient housing market.
Current supply will be absorbed over the coming years, but data shows that future supply is continually being suppressed. It’s also been heard recently that some of the more established, larger developers are indicating that any future high-rise presale launches in Surrey are likely to be delayed until 2027–2028. With completion timelines for these large-scale developments now pushing four-to-five years, this could mean the next wave of new completions won’t occur until the early 2030s, leaving a potentially large gap in new home inventories that will likely increase pressure on prices as the market marches toward recovery in the coming years.
