West Orange County’s industrial real estate market was a lease-rates laggard in the first quarter.
Rates in the general OC industrial market continued to rise in the quarter, increasing an average 1 cent overall to 62 cents per square foot.
In West OC the average lease rate remained even with the previous quarter at 57 cents per square foot amid higher vacancy rates and negative net absorption.
The general trend of increasing lease rates is a result of a tight market coupled with an increase in demand: The OC market is operating at a vacancy rate of 3.4%, second-lowest in the nation after the Los Angeles-area market, which has a vacancy rate of 3%.
The 40-million-square-foot West OC submarket had an average availability rate of 11% in the first quarter, lower than South OC’s rate of 11.5%. West OC availability includes more than 1.4 million square feet of available space in Cypress, which posts an availability rate of 22.4% and a vacancy rate of 11%.
OC’s industrial sector marked 91,630 square feet of negative net absorption overall. Some 127,088 square feet of negative absorption was marked in West OC. (South and North OC both posted positive net absorption of 128,278 square feet and 354,439 square feet, respectively.)
West OC hasn’t had any new inventory added since the third quarter of 2008 and none planned for the immediate future.
Data and analysis provided by CBRE Group Inc.
