With existing industrial warehouse space filled to capacity and rent hikes on triple-net leases expected to exceed 60 percent this year in Southern California's Inland Empire, new warehouse development is expanding in the eastern half of the region, which spans Riverside and San Bernardino counties from the Los Angeles city limits to the Arizona border.

CBRE is projecting that industrial warehouse tenants who plan to renew five-year leases or move to another space in Inland Empire will be confronted with the third-largest rent increase in a US market this year, boosting Inland Empire's current average of $6.75/square foot to $10.92/square foot. 

A record cargo volume of 20 million TEUs at the Port of Los Angeles/Long Beach and surging demand from the e-commerce sector have reduced vacancies at Inland Empire warehouses to less than one percent, an all-time low. Most of the existing warehouse space is in the western half of the region, which has few available sites for large new logistics facilities.