The Inland Empire has exploded on to the scene as one of the nation’s most in-demand industrial markets. After rents bottomed out in 2010 at $0.32/SF, we have seen a steady annual growth each year. In 2018, the average asking rent reached $0.69/SF, up 9.5% from the prior quarter and up 21.1% from 4Q 2017. This is more than double the asking rent in 2010. All the while, the vacancy rate has been trending lower despite a high construction volume. More than 24.2 million square feet of industrial construction was completed in 2018, while the vacancy rate declined from 5.4% in 2017 to 4.8%. Demand for warehouse and distribution space in the Inland Empire has been driven primarily by large corporate users and logistics companies. With cargo volume from the ports of Los Angeles and Long Beach expected to rise with increased consumer spending, demand for warehouse space will remain strong in 2019.
Stay tuned for our 4Q18 Quarterly Outlook reports coming soon.