Vacancy for North County Industrial is down to 5.3%

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Behind the Numbers

At the close of Q3 2018, combined industrial/R&D vacancy stood at 5.3%. This is a 57 basis point decrease from the prior quarter (5.9% in Q2 2018). Direct vacancy made up 4.8% of the
inventory while sublease vacancy stood at 0.5%. All five North County submarkets maintain vacancy rates below 9.0%. 

North County combined industrial/R&D net absorption totaled 506,871 SF during Q3 2018. Industrial buildings (manufacturing, warehouse, distribution and multi-tenant/incubator uses) posted positive net absorption of 357,234 SF; R&D buildings (flex, wet lab and R&D uses) posted positive net absorption of 149,637 SF. Escondido (+251,746 SF) posted the greatest net absorption for North County and the second highest net absorption countywide behind Otay Mesa (+371,403 SF). This was driven primarily by Veritiv occupying 212,088 SF at a recently completed building in Escondido.

Average asking rental rates for all product types combined in North County was $0.94/SF on a triple net basis (NNN) compared to $0.93/SF last quarter. 

 212,088 SF of new construction was completed in Q3 2018. The building completed was Exeter Property Group’s 212,088 SF build to suit for Veritiv at 1925-2005 Harmony Grove Rd in Escondido that is fully leased.

There was 1,638,885 SF under construction in North County as of Q3 2018. Some significant projects to highlight include Ryan Companies’ 417,478 SF Pacific Vista Commerce Center
in Carlsbad, McDonald/Black Creek’s 277,793 SF Pacific Coast Collection in Oceanside and RAF Pacifica’s 222,028 SF pro∙duc∙tion four-building development in San Marcos.


Vacancy for North County Industrial is down to 5.3%

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