The West Orange County industrial submarket experienced historically low vacancy rates last year, though it was no surprise that we continued to experience positive net absorption—this time at 234,204 square feet—a great indication of the strength in demand.
The year-over-year vacancy rate dropped from 2.1% to 1.9%, and the trend of increasing lease rates continued.
The average monthly asking lease rate increased 3 cents to 66 cents per square foot, up 4.7% over the third quarter.
Sale prices continued to increase at a faster rate than lease rates due to a decrease in vacancies, lack of availability and consistently low interest rates.
Morgan Stanley welcomed a new 83,391-square-foot tenant, GBI Tile & Stone, to its Huntington Beach portfolio.
Shea Properties brought on new 94,572-square-foot tenant Restaurant Depot to its newly constructed project in Huntington Beach. The start rate of 76 cents per square foot triple-net was a record-high lease comparable in West Orange County in that size range.
There is limited new construction on the immediate horizon, so we project that the positive trend will continue this year.
Schneider is an associate analyst at CBRE. Data and analysis are provided by CBRE Research.
