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Industrial Vacancy Rate Holds Steady As
Asking Rental Rates Decline
Sales and leasing activity in the first quarter totaled 5.0 million SF,
more activity than occurred in the second half of 2007. This was due to
several very large deals that stalled last quarter and were not able to
close until the beginning of this year, such as Whirlpool’s 1.6 million
SF lease in Perris.
This surge in sales and leasing activity boosted net absorption to 2.8
million SF, up significantly from 583,600 SF the previous quarter although
less than the 3.2 million SF from the first quarter of 2007.
Recently completed space totaled 3.3 million SF this quarter. The amount
of space under construction has slowly declined over the past year and
now stands at 8.6 million SF, down from 10.7 million SF last quarter and
down from 13.3 million SF one year ago. This gradual decrease in construction
activity coincides with a softening in the overall economy and rising concerns
of overbuilding.
Long-term, however, tight market conditions and low levels of construction
in the rest of the Los Angeles Basin will inevitably cause demand to shift
to the East Inland Empire, which is the only expansion area left in the
region.
Contact Thomas Galvin at 909.637.6309 for more information.
  INDEIE08Q1.pdf
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