Significant Sales Mark the End of 2018
The Tri-Valley industrial market finished fundamentally strong in 2018 with some significant sales transactions, despite the overall vacancy rate creeping up to three percent, which is two percentage points higher than at the end of 2017. Additionally, the year-to-date net absorption rate was negative 408,562 (versus positive 102,274 square feet at the end of last year). As rents tick higher in surrounding markets, the Tri-Valley is once again becoming a viable option for those tenants who are reevaluating their space and location needs. While the Tri-Valley continues to have a preferable location given its mid-point between the San Francisco Bay Area and the Central Valley, higher rental rates, larger operating expenses and lower general availability continue pushing many tenants to consider migrating eastward into the Central Valley. Compared to last year at this time, Tri-Valley light industrial rental rates increased fourteen percent, and Tri-Valley warehouse rates increased ten percent. From a total market of almost twenty million square feet, there is still only 557,880 square feet available for lease or purchase. These numbers will increase significantly in 2019 as new, big box construction comes online in the Livermore market.
Would you like to have future reports delivered directly to your inbox? Sign-up to this and other regional e-mail delivery lists.