LOS ANGELES—The walls are going up at the International Airport Center's new 1.3 million square-foot industrial project in Valencia. IAC Commerce Center is one of the largest industrial projects in the market, which has a 1.4% vacancy rate. As a result, the project has gotten tremendous interest from potential tenants looking to get space in the tight market.

“We are seeing significant early interest in the new buildings from many different industries such as consumer distribution, entertainment companies, and aerospace and defense companies. Each building can accommodate one to two tenants,” Craig Peters, the CBRE broker handling leasing for the project, along with Doug Sonderegger. “Our goal is to lease them as single buildings, but we have the flexibility to split them if that is most beneficial.”

The wall tilting ceremony officially takes place today, and the brokerage team is expecting the event to generate more activity. “The wall tilting ceremony is today, and we will see another surge in activity as the event occurs and decision makers can better visualize the project,” Peters says.

As a result of the limited supply and strong demand for space at this project, Peters expects to get healthy rental rates, although they have not announced lease rates and wouldn't comment specifically on the pricing that they expect for the property. However, the market has seen significant rental appreciation as a result of the tight supply, and a brand new property will absolutely benefit from the imbalance. “The high demand and limited supply has pushed rates up 10% over the last 12 months,” says Peters. “In most instances, we have two to three companies looking at every available building.”

The IAC Commerce Center has buildings ranging in size from 93,600 square feet to 187,540 square feet, and build-to-suit opportunities up to 560,000 square feet. While no leases have been signed yet, the leasing team expects to be at 100% occupancy by completion of the project, which is expected in June or July or this year.

Instant Insights /

When Industrial Walls Go Up, Tenants Show Up

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