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SALES AND LEASING ACTIVITY LOWEST IN FIVE YEARS; TOTAL VACANCY RATE INCREASES TO 3.4%
The San Fernando Valley and Ventura County industrial market continued to reflect the weakness in the local economy in Q2 2008. With sales and leasing activity decreasing for the second consecutive quarter and the total vacancy rate increasing 10 basis points to 3.4%, it appears that the market is in the middle of a downturn. Although the overall vacancy rate remains low by historical standards, it is expected to increase over the next few quarters as the economy remains weak. In addition, sales and leasing activity is expected to remain at a low level as buyers and sellers continue to take a cautious approach due to the extreme uncertainty in the credit markets and the economy.
In Q2, both asking average rental rates and sales prices per SF remained flat. Construction remained restrained, indicating that market conditions will continue to remain tight throughout the remainder of 2008.
The vacancy rate in the area’s R&D market increased 90 basis points from last quarter to 6.1% although average asking rental rates increased from $0.98 PSF NNN to $1.02 PSF NNN. Sales and leasing activity was down to 193,300 SF in Q2 from 243,400 SF in Q1 reflecting how the slowdown in the economy is also impacting the area’s R&D market.
Contact Michael Soto at 213.532.3220 for more information.
  INDSFVVC08Q2.pdf
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