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VACANCY RATE UP; SALES PRICES PSF REMAIN HIGH IN THE SOUTH BAY INDUSTRIAL MARKET
Due to the recent weakness in the regional economy, the total vacancy rate in the South Bay industrial market increased 20 basis points to 3.0%. Average asking rental rates remained flat from Q1, however, average sales prices per SF continued to increase to $117 PSF, up 4.8% over a year ago. As the tight lending conditions have caused an overall slowdown in sales activity, the recent growth in sales prices per SF reflects the general strength of the South Bay industrial market as the investment market is seeing an overall flight to quality.
At the end of the quarter, construction activity was moderately strong with 1.4 million SF of space currently underway. However, this recent uptick in construction continues to lag demand. With the regional economy slowing down and energy prices at an all-time high, the South Bay industrial market is currently seeing an increase in the amount of space available for sale and lease, however, the overall market is projected to remain tight throughout the remainder of 2008.
Contact Michael Soto at 213.532.3220 for more information.
  INDSB08Q2.pdf
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