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VACANCY AND AVAILABILITY CONTINUES TO RISE DESPITE INCREASE IN SALES & LEASING ACTIVITY
The South Bay industrial market continued to experience rising vacancy and availability rates in Q3. With vacancy levels increasing 30 basis points over last quarter to 5.1%, there is more vacant space on the market than at any time in the past seven years. While the rate of space givebacks was
much less than the 1.0 million SF returned to the market in the previous quarter, a rising availability rate, especially within the big-box building segment (100,000+ SF), indicates that vacancy levels will continue to rise through at least the first few months of 2010.
Direct weighted average asking rental rates decreased for the fourth consecutive quarter ending at $0.58 per square foot, per month Triple Net (NNN). In addition, average sales prices PSF continued to decline from $112 PSF reported in Q2 to $109 PSF at the end of Q3. Declining asking rents and average sales prices combined with an availability rate that has increased to 9.3% make it clear that the South Bay industrial market is currently in the middle of a serious market correction from the construction and consumer-led boom which characterized most of this decade.
Contact Michael Soto at 213.532.3220 for more information.
  INDSB09Q3.pdf
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