NEWPORT BEACH, CA—“Overall in the Orange County industrial market over the last three years, vacancy has reduced over 18.5%, while availability has decreased a jaw-dropping 33%.” So says Jerry  Holdner, VP of market research for Voit Real Estate Services, which just released its fourth-quarter 2014 report for Orange County's industrial-market fundamentals.

The market took significant strides toward continued improvement in 2014 with significant positive absorption for the year, a two-cent or 3.3% increase in asking lease rates and drops in both vacancy and availability, according to Voit. Both vacancy and availability continued trending downward throughout 2014, with vacancy ending the fourth quarter at 3.58%, one of the lowest rates since 1998 and a drop of more than 9% from fourth-quarter 2013. Likewise, availability posted a rate of 5.85% at the close of the year, the lowest rate in more than five years and a decrease of almost 5% from 2013.

As lease rates rise, sales prices are also ticking up, says Holdner. He attributes this trend to the diminishing supply of industrial product for sale in Orange County, particularly in buildings smaller than 100,000 square feet. “Currently, only around 1% of the inventory in the Orange County industrial market is available for sale. This lack of supply will continue to place upward pressure on pricing going forward.”

Overall, Voit continues to be cautiously optimistic about the Orange County market, Holdner adds. “We continue to see improvement in both the office and industrial markets, and we anticipate positive gains moving forward, provided job creation continues and consumer confidence stabilizes.”

As GlobeSt.com reported in December, confidence levels continue to rise and uncertainty is decreasing, leading to job growth and a stronger economy, according to

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Editorial|&utm_term=|Website-Editorial-NAT(Website)|"> Auction.com Research's senior associate and economist Peter Muoio. “The fundamental turning point, if you will, that we've been talking about throughout 2014 was a reduction in the level of uncertainty,” Muoio told us. “People may think of this as sort of touchy-feely and anecdotal, but there's actually an index we follow that's published by academic economists that showed a break in uncertainty at the beginning of 2013. We're now back down to the level of historical run rate for this country in uncertainty, which makes a difference when it comes to businesses investing and hiring and households making bigger purchases. So, the level of uncertainty is a key one. The natural reaction we all have when we're uncertain is to freeze in place and not do anything, so improvement in the uncertainty level and confidence—which are two sides of the same thing—has been a big factor in firms starting to pick up hiring.”

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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.