COMPTON, CA—Industrial tenants are having a hard time in the South Bay. The vacancy rate in the Los Angeles submarket has dipped below 1%, leaving virtually no options for tenants in need of space. When something does become available—by sheer luck—the competition to win the deal is incredibly steep. Colliers International associate VP Kyle Degener and SVP Lary Carlton recently beat out the competition on a 158,357-square-foot industrial facility in the South Bay, on behalf of their client Empire Container Freight Station. The tenant signed a five-year lease deal at the property, located at 19600 S. Alameda St., valued at $6.7 million.

“The market is at 1% vacancy, so any time a new property comes onto the market, we quickly fire it off to all of our clients that are currently active in the market,” Degener tells GlobeSt.com. “You have to keep opening up the search, and that includes the size and the location. When we see something, we have to act fast and submit an aggressive offer.”

Degener also stresses the importance of flexibility to win these deals. His client originally wanted a 120,000-sqaure-foot facility, but took the larger property to allow for growth and to take advantage of the prime location. “This company was looking for a 100,000-square-foot to 120,000-square-foot facility, and this is a 160,000-square-foot facility,” he explains. “When this came on the market, the location and their growth potential encouraged us to pursue this property.”

The listing saw tremendous interest from regional and national tenants. “We new we were going up against companies that had better credit. For that reason, we submitted our offer with a strong security deposit,” says Degener. “They countered back asked for even more, and we quickly accepted. You have to try and make the deal as clean as possible, from rents and tenant improvements to the security deposit. We came in strong on all of those points.”

Properties that do become available in this market aren't prefect. Degener says that there were some challenges with this property, including low 18-foot clear heights. “There is an 18-foot clearance height, which a lot of people won't look at. This building was priced below the rest of the market price for that reason,” he says, adding that the landlord had a planned renovation as well, which made it more attractive to his client overall. “The building was also going through a complete refurbishment,” he said. “They ended up doing an interior and exterior refurbishment, including adding in new loading doors. That added incentive for our client.”

COMPTON, CA—Industrial tenants are having a hard time in the South Bay. The vacancy rate in the Los Angeles submarket has dipped below 1%, leaving virtually no options for tenants in need of space. When something does become available—by sheer luck—the competition to win the deal is incredibly steep. Colliers International associate VP Kyle Degener and SVP Lary Carlton recently beat out the competition on a 158,357-square-foot industrial facility in the South Bay, on behalf of their client Empire Container Freight Station. The tenant signed a five-year lease deal at the property, located at 19600 S. Alameda St., valued at $6.7 million.

“The market is at 1% vacancy, so any time a new property comes onto the market, we quickly fire it off to all of our clients that are currently active in the market,” Degener tells GlobeSt.com. “You have to keep opening up the search, and that includes the size and the location. When we see something, we have to act fast and submit an aggressive offer.”

Degener also stresses the importance of flexibility to win these deals. His client originally wanted a 120,000-sqaure-foot facility, but took the larger property to allow for growth and to take advantage of the prime location. “This company was looking for a 100,000-square-foot to 120,000-square-foot facility, and this is a 160,000-square-foot facility,” he explains. “When this came on the market, the location and their growth potential encouraged us to pursue this property.”

The listing saw tremendous interest from regional and national tenants. “We new we were going up against companies that had better credit. For that reason, we submitted our offer with a strong security deposit,” says Degener. “They countered back asked for even more, and we quickly accepted. You have to try and make the deal as clean as possible, from rents and tenant improvements to the security deposit. We came in strong on all of those points.”

Properties that do become available in this market aren't prefect. Degener says that there were some challenges with this property, including low 18-foot clear heights. “There is an 18-foot clearance height, which a lot of people won't look at. This building was priced below the rest of the market price for that reason,” he says, adding that the landlord had a planned renovation as well, which made it more attractive to his client overall. “The building was also going through a complete refurbishment,” he said. “They ended up doing an interior and exterior refurbishment, including adding in new loading doors. That added incentive for our client.”