Low finish industrial asking rents keep accelerating across the county
- Industrial asking rents saw record growth starting in 2015 with South County leading the pack at 44 percent; strong industrial fundamentals point to continuation of this trend. Market demand from the 3PL and E-Commerce industries have played a big role in the robust industrial sector.
- Reasons for each submarket clusters’ 20 to 40 percent rent growth since 2013 stem from an overwhelming ratio of supply and demand; with 7.7 million square feet (s.f.) of positive absorption and only 2 million s.f. of deliveries in that time frame. Developers have responded to the wave of industrial demand with a current total of 3 million s.f. under construction countywide (2.1m s.f. North, 750,000 s.f. Central, and 270,000 s.f. South County).
- In addition to high demand, new industrial properties now have incorporated more amenities, 30’ plus clear heights, energy efficient designs, and more functional trucking features to capture higher credit tenants. With low vacancy, new inventory, over 4 million s.f. of tenant requirements, and new supply at 40 percent preleased, builders are confident that 2018 will be a strong year for industrial real estate.
Senior Research Analyst
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