ANAHEIM, CA—Wholesale flooring distributor LongustDistributing has signed the first lease at AnaheimConcourse, 1.4-million-square-foot, master-planned projectcurrently in development by PanattoniDevelopment Co. and Clarion Partners. Thetenant, which serves the Southwest, has signed a 10-year,93,818-square-foot industrial lease at the projectand will occupy the space upon completion in 2015 as its SouthernCalifornia distribution center.

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JLL Orange County's senior managing directorLouis Tomaselli, SVP Zach Nilesand SVP Steve Wagner represented Longust in thetransaction, while the landlord JV was represented byCBRE's SVP Brad Bierbaum.Tomaselli says, “After a comprehensive market analysis,supply-chain and logistics study, Longust decided thatleasing state-of-the-art space at AnaheimConcourse was the most cost-efficient alternative based on its32-foot clear ceiling height, ability to rack five high, themost accessible transportation network and the ability to remain inthe business-friendly city of Anaheim. While the Orange Countyindustrial market continues to tighten, JLL was able to negotiatelease terms that provided flexibility for growth and cost savingsbased on effective use of cube height.”

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Tomaselli adds, “Orange County, along with Southern California,has broken through 2008 historical, pre-recession vacancy lows andlease-rate highs. Orange County in particular is anticipated toenjoy strong occupancy levels based on the continuing story ofstrong and stable tenant- and owner-occupier demand, complementedwith a limited amount of new supply coming online. Currently, theOrange County industrial market has a second-quarter direct vacancyof 4.1%.”

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Industrial space of the size Longust needed isscarce in Orange County. Tomaselli tells GlobeSt.com, “As of Q42014, based on a 260-million-square-foot industrial base in the OC,there are only five alternatives that offer 30-foot or greaterclear heights with 90,000 square feet to 216,000 square feet. Thereare seven alternatives under construction orplanned with 30-foot clear heights offering 95,000 square feet to367,000 square feet. This is a less-than-1% vacancy rate in eachsector. There is a 200-basis-point or greater delta between class Aand class B/C space, meaning 2.63% vacancy for class A and 4.72%for class B/C. We have reached the landlord-leveraged marketcondition we have anticipated for the past three-plus years.”

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Carrie Rossenfeld

Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.