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INDUSTRIAL VACANCY HITS 6-YEAR HIGH IN THE SOUTH BAY
The first half of 2009 saw nearly 2.1 million SF of industrial space returned to the South Bay industrial market as a result of a weak global economy. With a global recession that has not been experienced since the immediate aftermath of World War II, the South Bay industrial market has seen the total vacancy rate increase an additional 60 basis points from a revised 4.2% in Q1 to 4.8% in Q2. This level of industrial vacancy constitutes a six-year high for the South Bay.
Average asking rental rates continued to decrease for the third consecutive quarter ending Q2 at $0.61 per square foot, per month Triple Net (NNN). In addition, average sales prices PSF accelerated their decline from $117 PSF reported in Q1 to $112 PSF at the end of Q2. Declining average asking rents and average sales prices combined with an availability rate that has increased 140 basis points from 7.6% in Q1 to 9.0% in Q2 are an indication that the first half of 2009 appears to be
the beginning of a serious market correction from the record high rents and sales prices seen just a year ago.
Contact Michael Soto at 213.532.3220 for more information.
  INDSB09Q2.pdf
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