Asking Rates Rise To Highest Point Ever
The Los Angeles Basin industrial market is the largest market in the United States, totaling over 1.57 billion SF. It also has some of the highest asking rental rates as well as one of the lowest vacancy rates of any market in the US.
Major industrial drivers for the region continue to be imports at the twin ports of Los Angeles / Long Beach, which handle roughly 40% of all imports into the country. In addition, the region is the largest manufacturing center in the United States, with more manufacturing jobs than the entire state of Illinois.
- Asking rents rose to $0.68 PSF NNN, the highest reported rental rate for the Greater Los Angeles Basin.
- The Greater Los Angeles Basin industrial market absorbed 6,025,000 SF of industrial space this quarter with uneven gains by region. Absorption was highest in the Inland Empire at 6,624,500 SF while Orange County reported 37,300 SF of negative absorption.
- This quarter saw 8,737,900 SF of industrial space added to the base. Despite the current construction boom taking place, vacancy has remained flat over the quarter at 2.2%.
Despite the drop in absorption during the third quarter, the Orange County industrial market continues to move forward with positive momentum. With minimal increase in available supply, asking rental rates have climbed above 2008 peak values of $0.78-$0.80 PSF NNN. Despite positive market fundamentals, tenants are struggling to find future space options to meet their needs given the lack of available inventory.