Despite what is known in the commercial real estate industry as the annual summer doldrums, activity levels from 2009 to 2010 have grown quarter by quarter, including for manufacturing and warehouse space.
Orange County’s manufacturing and warehouse sector is made up of nearly 6,000 buildings totaling more than 9 million square feet. Most of those buildings are in the North County submarket.
The vacancy rate for manufacturing and warehouse space in the county continues to drop each quarter, with rates falling to 4.5% in the second quarter.
Buildings are seeing an increase in leasing activity and more aggressive moves by landlords. Asking lease rates fell to 53 cents per square foot in the second quarter, down from 60 cents a year earlier.
The South County submarket saw the biggest drop in asking rents, falling 11 cents to 61 cents per square foot.
As of the second quarter, the availability rate has risen to an average of 11.4% countywide.
With summer behind us, we can better gauge the balance of 2010. Indicators are that we will continue to see an increase in activity in OC, as well as in the other Southern California industrial markets such as the Inland Empire.
As we approach the end of 2010 and get farther from the challenges of 2009, we will continue to see momentum grow, and return to a more active marketplace.
Wootan is a first vice president in the Anaheim office of CB Richard Ellis Group Inc.
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