Inland Empire Industrial in a Perfect Balance

The industrial market is undeniably strong throughout Southern California, but while the costal markets are suffering from a severe supply shortage, land shortage and dramatically increasing rental rates—a problem only from the tenant perspective—the Inland Empire market is seeing a happy equilibrium between supply and demand, along with steadily rising rental rates that are still a discount to the coastal markets. We sat down with Frank Geraci, EVP and partner at Voit Real Estate Services who recently secured a $33 million lease of a 750,000 square-foot industrial warehouse in the five-building Shea Center Ontario business park in Ontario, California, to get an inside look at the leasing activity in the Inland Empire.

GlobeSt.com: In general, what has the industrial leasing activity in the IE been like this year and how does it compare to the same time in 2017?

Frank Geraci: Industrial leasing continues to perform exceptionally well in the Inland Empire, driven most prominently by the availability and quality of the product. Industrial users seeking space in Southern California are increasingly expanding their search to Inland Empire facilities based on tremendously tight, sub-one-percent vacancy in nearby markets such as Orange County and Los Angeles, and the need for buildings that can accommodate today’s logistical needs for “cube” and velocity.