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Activity Continues To Slow In The West
Inland Empire Industrial Market
After five consecutive quarters of very strong activity, sales and leasing
continued to slow in Q1 2008 in the West Inland Empire industrial market.
Sales and leasing activity totaled 2.9 million SF in the first quarter,
similar to the level of activity seen in the last quarter but down significantly
from 4.8 million SF in the first quarter of last year. Net absorption remained
negative (-621,200 SF), a rare occurrence in this market. Reasons for this
slowdown appear to include a sluggish economy and adjustment to above-average
activity in previous quarters.
Average asking lease rates have declined $0.02 over the previous quarter
as a direct result of higher vacancy rates in the largest building size
segment (100,000+ SF). These large buildings have lower asking lease rates
and due to their size they greatly influence the weighted average asking
lease rate numbers.
Construction activity is strong, at 4.5 million SF, although developers
are wary about starting new projects given the current state of the economy.
Vacancy rates may climb further as this space comes on-line but should
remain low by comparison to the vacancy rates experienced in the neighboring
East Inland Empire industrial market.
Contact Thomas Galvin at 909.937.6309 for more information.
  INDWIE08Q1.pdf
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