Vacancy Plummets & Rents Rise Slightly Higher
- The vacancy rate fell 120 basis points this quarter as the largest building on the market was finally leased. Vacancy ended the quarter at 0.9%, making the Mid-Counties industrial market one of the tightest industrial markets in Southern California.
- Average rents increased by $0.01 per square foot (PSF) triple net (NNN) over the previous quarter to end at $0.84, a new high-water mark for this market. Over the past 12 months, asking rents have increased by $0.06 PSF NNN or 7.7%.
- Sales and leasing activity totaled 2,206,900 square feet this quarter, which is significantly above average for this market. There were 20 leases in 2,139,400 square feet of space and only three sales, totaling 67,500 square feet.
- Net absorption registered a positive 1,286,400 square feet this quarter and totaled 655,400 square feet for the year.
Mid-Counties Industrial Market:
Most small-and-mid-sized users of industrial space in this market still face limited expansion options. Land remains scarce and there is limited planned new building development activity.
Asking rents have continued to increase as strong tenant demand and few development options have led to a shrinking supply of available space. Recent interest in lastmile distribution centers has put increased focus on the Mid-Counties, which is the geographic heart of Southern California.