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The industrial market in Southern California is suffering from a severe and well-documented supply shortage in the face increasing demand. In Orange County, however, the supply-demand balance in the small-box segment of the market is healthier, with a higher 3% vacancy rate and more opportunities for developers to bring new supply to the market. Still, this segment has also seen strong demand from users and increasing rents as a result.

“There continues to be high demand for industrial building between 50,000-100,000 square feet in Orange County, vacancy rates posting consistently in the 3% range and asking rental rates in the county increasing 8 percent over the past year,” Chris Migliori, EVP and principal at DAUM Commercial Real Estate Services, tells GlobeSt.com. “That said, much of the existing inventory consists of smaller buildings under 30,000 square feet, and developers who have been fortunate enough to secure land would prefer to develop and deliver single tenant buildings in the 200,000 square-foot-plus range.  The contributors for such development in that size range is lack of inventory, cost of construction and the spike in Industrial Land prices in the past 36 months.”

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance writer and editor living in Los Angeles whose work has appeared in such publications as Travel + Leisure, Angeleno and Los Angeles Magazine.

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