LOS ANGELES—"Cap rates will still go down. We'll see cap ratesin the threes," said Mark Detmer, managingdirector and head of industrial capital markets in the westernregion at JLL, at the recent RealShareIndustrial West conference. Last year, the industrialmarket had its best year in history, with a total of $56 billion inindustrial investment. According to Detmer, while there may be someslow down this year, cap rates will compress even further.

Detmer spoke on the Port Activity, Logistics and Industrial RealEstate panel, along with Mark Hirzel, districtmanager, A.N. Deringer; DonSnyder, director of business development at thePort of Long Beach; and KimSnyder, president of the Southwest region atPrologis; as well as panel moderator IanBritton, managing director at Voit Real EstateServices. The other panelists shared Detmer's marketperspective. "It is a safe asset class," said Kim Snyder."Logistics is becoming part of the local economy in everyeconomy."

A lot of the big business was done in the Inland Empire.According to Kim Snyder, 9 one-million-square-foot buildings wentup in the Inland Empire last year, and all of that square footagehas been absorbed, and he is sure the same thing will happen thisyear. In markets like the South Bay, which also has an incrediblylow industrial vacancy, he said that they are trying to buildmulti-story industrial to accommodate the demand, but they haveseen some pushback from the community.