The combined South Orange County industrial market recorded 49,674 square feet of positive net absorption in the first quarter.
The overall vacancy rate decreased from 3% in the first quarter of 2015 to 2.4%, reflecting a 20% year-over-year decline.
The industrial market is made up of both manufacturing and warehouse buildings and research and development properties.
The sector, due to the density of research and development buildings in South Orange County and the user base, typically has steady activity and is particularly attractive to biotechnology companies.
Research and development product recorded positive 19,114 square feet of net absorption in the first quarter.
The vacancy rate for research and development dropped from 3.9% a year earlier to 3.7%.
The manufacturing and warehouse sector also recorded positive net absorption, ending the quarter with 30,560 square feet. The increase in occupancy levels pushed down the vacancy rate from 1.7% in the fourth quarter to 1.5%.
The manufacturing and warehouse vacancy rate also was down year-over year, from 2.4% a year earlier to 1.5%.
Asking Rates, Demand
The average asking rate in the manufacturing and warehouse sector increased 2 cents over the fourth quarter to 87 cents per square foot, and the research and development sector decreased 1 cent to $1 per square foot.
That brought the overall asking rate to 92 cents per square foot, which represented a 2-cent decrease from the fourth quarter and a 7% increase year-over-year.
Demand is projected to increase, and South Orange County average asking lease rates are therefore forecasted to continue rising.
Research and analysis provided by CBRE Research
