The Inland Empire closed 2012 with continued signs of growth and promise for this year.
The first quarter generated about 6.8 million square feet of gross activity in the industrial market, split between nearly 2.3 million square feet in the Inland Empire East and roughly 4.5 million square feet in the Inland Empire West.
The Inland Empire’s first-quarter net absorption totaled 3.4 million square feet, representing a year-over-year increase of about 1.2 million square feet. Vacancy and availability rates declined at quarter’s end due to the larger deals of 500,000 square feet and more that were inked. The overall availability rate currently stands at 11%, while the vacancy rate is 6.2%, both down 0.4% compared to the fourth quarter.
Notable Deals
Two notable deals took place during the quarter in the Inland Empire West. Campbell’s Foods signed a new lease for 573,000 square feet in Rancho Cucamonga, and Mobis Parts America signed a lease for 506,436 square feet in Ontario. Jarden Corp. also renewed its lease for 827,650 square feet in the Inland Empire West.
The largest Inland Empire East deal came in a 480,570-square-foot building in San Bernardino preleased to Pepsi Co.
Vacancies
The economic downturn gave the Inland Empire one of the hardest knocks in the country, but with the fall in unemployment last year, activity picked back up, and the first quarter generated 12,649 square feet in net absorption in the office market.
The vacancy rate remained on par with the end of 2012, dropping only 10 basis points and ending the first quarter at 21.2%.
The Inland Empire office market continues to have the highest vacancy rate among Greater Los Angeles region markets. New speculative supply drastically outpaced demand during the recession, and absorption hasn’t yet caught up.
Data and anaylsis provided by CBRE Research.
The Real Estate Watch Chart
Net Absorption, Rates, etc. is provided in a Adobe Reader .pdf print-friendly file.
