los angeles - air cre · 13012 midway pl, erritos 167,996 u.s. orrugated inc midounties whse/mfg...
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2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
INDUSTRIAL MARKET REPORT
Los Angeles 4th Quarter 2016
Produced in partnership with
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
2
Table of Contents and Methodology/Map 2-3
Market Overview 4-5
Statistics by Market 6
Vacancy Rates & Asking Rates 7-8
Leasing & Absorption 9
New Construction 10
Industrial Advisory Board Members 11
Xceligent Team 12
The Los Angeles tracked set consists of an inventory of buildings considered to be competitive by the brokerage community. All buildings within the competitive tracked set have been reviewed and verified by members of the Advisory Boards for the market area.
Xceligent is a leading provider of verified commercial real estate information which assists real estate
professionals, appraisers, owners, investors and developers that make strategic decisions to lease, sell,
buy and develop commercial properties.
Table of Contents/
Methodology of Tracked Set
Tracked Inventory (Industrial)
The total square feet (sf) of all existing single and multi tenant industrial properties greater
than 10,000 sf.
Direct Vacant (sf)
The total of the vacant square footage in a building that is being marketed by an agent
representing the landlord.
Net Absorption
The net change in physically occupied space from quarter to quarter, expressed in square
feet.
Sublease (sf) Space that is offered for lease by a current tenant, or his agent, within a property. Whether
the tenant is paying rent or not, the space is considered vacant only if it is unoccupied.
Total Available (sf)
All of the available leasable space within a building, whether it is occupied or vacant, for
direct lease or sublease space.
Total Vacant (sf)
The total of all of the vacant square footage within a building, including both direct and
sublease space.
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
3
Industrial Market Map
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
4
Overview
Los Angeles Industrial Overview
The Los Angeles industrial market closed out the fourth quarter of 2016 with a total of 1,544,884 square feet (sf) of positive net absorption.
With a vacancy rate of 1%, the LA industrial market is the lowest in the nation.
The LA South (South Bay) submarket recorded the most activity by absorbing 819,013 sf in the fourth quarter.
Development activity remains active despite the lack of infill space throughout the county with 4.7 million sf of new construction underway.
Vantec World Transport inked the largest lease of the quarter with a 197,685 sf deal at the new Oakmont Pomona development.
# of Bldgs Inventory (sf) Total
Available (sf) Total
Vacant (sf) Total
Vacancy Rate (%) Total Quarterly
Net Absorption (sf) YTD Total Net
Absorption (sf)
LA Central 4,611 198,637,700 9,826,535 2,308,699 1.2% 407,261 1,791,859
LA South 4,490 207,269,462 6,846,140 2,338,647 1.1% 819,013 842,037
LA Northwest 3,841 120,549,221 4,189,740 1,212,848 1.0% 100,029 929,172
LA East 3,713 154,159,654 5,117,188 1,576,707 1.0% 133,451 562,894
MidCounties 2,039 101,174,080 2,479,108 663,733 0.7% 85,130 617,935
Overall 18,694 781,790,117 28,458,711 8,100,634 1.0% 1,544,884 4,743,897
# of Bldgs Inventory (sf) Direct
Available( sf) Direct
Vacant (sf) Direct
Vacancy Rate (%) Direct Quarterly
Net Absorption (sf) YTD Direct Net Absorption (sf)
LA Central 4,611 198,637,700 7,880,666 2,283,470 1.1% 419,891 1,748,518
LA South 4,490 207,269,462 6,398,006 2,288,797 1.1% 808,760 882,231
LA Northwest 3,841 120,549,221 3,581,998 1,175,848 1.0% 113,913 952,310
LA East 3,713 154,159,654 4,423,708 1,548,057 1.0% 133,451 321,535
MidCounties 2,039 101,174,080 1,987,481 645,554 0.6% 101,302 636,114
Overall 18,694 781,790,117 24,271,859 7,941,726 1.0% 1,577,317 4,540,708
# of Bldgs Inventory (sf) Available
Sublease (sf) Sublease
Vacant (sf) Sublease
Vacancy Rate (%) Sublease Quarterly
Absorption (sf) YTD Sublease Net
Absoprtion (sf)
LA Central 4,611 198,637,700 1,945,869 25,229 0.0% -12,630 43,341
LA South 4,490 207,269,462 448,134 49,850 0.0% 10,253 -40,194
LA Northwest 3,841 120,549,221 607,742 37,000 0.0% -13,884 -23,138
LA East 3,713 154,159,654 693,480 28,650 0.0% 0 241,359
MidCounties 2,039 101,174,080 491,627 18,179 0.0% -16,172 -18,179
Overall 18,694 781,790,117 4,186,852 158,908 0.0% -32,433 203,189
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
5
Los Angeles Industrial Overview
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016
Historical Vacancy Rate & Net Absorption
Absorption Vacancy
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016
Historical Vacancy Rates by Use
Whse/Mfg Flex/R&D
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016
Historical Net Absorption by Use
Whse/Mfg Flex/R&D
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
6
Statistics by Market
# of Bldgs Inventory (sf) Total
Vacant (sf) Sublease
Vacant (sf) Vacancy Rate (%)
Total Quarterly Absorption (sf)
YTD Total Net Absorption (sf)
LA South 4,490 207,269,462 2,338,647 49,850 1.1% 819,013 842,037
Carson-Compton/Rancho Dominguez 1,320 84,149,040 700,857 0 0.8% 157,499 88,415
Gardena/North Compton 849 30,504,093 777,681 24,040 2.5% 595,963 553,871
Long Beach/Paramount/Signal Hill 914 27,788,917 200,130 0 0.7% 25,006 111,765
Torrance 747 36,048,433 436,818 25,810 1.2% 4,860 158,905
LAX Area 570 24,571,968 223,161 0 0.9% 35,685 -75,181
Port District 90 4,207,011 0 0 0.0% 0 4,262
LA Central 4,611 198,637,700 2,308,699 25,229 1.2% 407,261 1,791,859
Commerce/Vernon 2,248 124,642,635 1,003,347 25,229 0.8% 636,397 1,400,228
CBD 1,517 46,944,688 1,108,606 0 2.4% -220,156 66,623
Outside Submarket Area 846 27,050,377 196,746 0 0.7% -8,980 325,008
LA East 3,713 154,159,654 1,576,707 28,650 1.0% 133,451 562,894
West 1,330 36,098,939 820,196 13,375 2.3% 5,767 -17,902
Industry 1,188 72,999,020 581,444 15,275 0.8% 22,145 99,927
210 Corridor 627 23,034,643 47,365 0 0.2% 7,327 90,896
Pomona 568 22,027,052 127,702 0 0.6% 98,212 389,973
LA Northwest 3,841 120,549,221 1,212,848 37,000 1.0% 100,029 929,172
East 1,815 53,697,674 474,600 37,000 0.9% 68,289 315,633
West 947 28,258,728 469,402 0 1.7% 14,285 277,307
Santa Clarita 531 21,321,087 198,882 0 0.9% 13,173 171,271
Central 548 17,271,732 69,964 0 0.4% 4,282 164,961
MidCounties 2,039 101,174,080 663,733 18,179 0.7% 85,130 617,935
LA Southeast 1,825 86,235,443 590,502 0 0.7% 78,634 493,563
Buena Park/La Palma 214 14,938,637 73,231 18,179 0.5% 6,496 124,372
Overall 18,694 781,790,117 8,100,634 158,908 1.0% 1,544,884 4,743,897
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
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Vacancy Rates & Asking Rates
Vacancy Rate %
4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016
LA East 0.8% 0.9% 1.0% 0.9% 1.0%
Whse/Mfg 0.7% 0.8% 0.9% 0.8% 1.0%
Flex/R&D 2.2% 2.5% 2.2% 2.9% 2.1%
LA Central 1.8% 1.7% 1.6% 1.3% 1.2%
Whse/Mfg 1.8% 1.6% 1.6% 1.3% 1.1%
Flex/R&D 2.7% 3.5% 2.9% 3.2% 2.9%
LA South 0.9% 0.8% 0.7% 0.9% 1.1%
Whse/Mfg 0.8% 0.8% 0.7% 0.9% 1.1%
Flex/R&D 1.6% 1.4% 1.6% 1.7% 1.6%
MidCounties 1.0% 0.6% 0.7% 0.5% 0.7%
Whse/Mfg 1.0% 0.6% 0.7% 0.5% 0.6%
Flex/R&D 1.0% 0.8% 0.9% 0.8% 0.8%
LA Northwest 1.8% 1.7% 1.6% 1.1% 1.0%
Whse/Mfg 1.5% 1.5% 1.3% 0.9% 0.8%
Flex/R&D 4.3% 3.9% 4.2% 2.5% 2.6%
Overall 1.3% 1.2% 1.1% 1.0% 1.0%
Weighted Average Asking Rent (NNN)
4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016
LA East $0.67 $0.73 $0.80 $0.75 $0.74
LA Central $0.78 $0.75 $0.78 $0.69 $0.73
LA South $0.78 $0.77 $0.79 $0.81 $0.81
MidCounties $0.60 $0.63 $0.66 $0.71 $0.71
LA Northwest $0.74 $0.74 $0.78 $0.80 $0.81
Grand Total $0.74 $0.73 $0.77 $0.76 $0.78
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
8
Vacancy Rates & Asking Rates
1.0%
0.7%
1.2%
1.0%1.1%
LA East MidCounties LA Central LA Northwest LA South
Vacancy Rate by Market
$0.74
$0.71
$0.73
$0.81 $0.81
LA East MidCounties LA Central LA Northwest LA South
Weighted Average Asking Rent by Market (NNN)
$0.38
$0.69
$1.55
$2.07
$0.75
$1.07
$-
$0.50
$1.00
$1.50
$2.00
$2.50
Whse/Mfg Flex/R&D
Asking Rent Range by Use (NNN)
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
9
Leasing & Absorption
Largest Leases & Absorption Changes
Property Name Occupied or Vacated (sf)
Tenant Name Submarket Specific Use
1589 9th St, Pomona 197,685 Vantec World Transport, Inc. LA East Whse/Mfg
13012 Midway Pl, Cerritos 167,996 U.S. Corrugated Inc MidCounties Whse/Mfg
4615 Alcoa Ave, Vernon 165,636 CA Liquidators LA Central Whse/Mfg
2910 E Pacific Commerce Dr, Rancho Dominguez 150,000 Trademango, LLC LA South Whse/Mfg
3200 E Slauson Ave, Vernon 143,897 Popcornopolis LA Central Whse/Mfg
6108-6120 Peachtree St, Commerce 105,286 Justman Packaging LA Central Whse/Mfg
20943 S Maciel Ave, Carson -176,031 Brookvale International LA South Whse/Mfg
14742-14750 Nelson Ave, Industry -145,531 BlueLinx Corporation LA East Whse/Mfg
1431 W Via Plata St, Long Beach -112,121 Alltrade Tools, LLC LA South Whse/Mfg
Top Transactions
Property Name Sale Price Sold (sf) Buyer Seller Submarket Specific Use
26030 Avenue Hall, Valencia $19,300,000 121,000 Valencia Holdings LLC & Valencia Studio Group
Capital Foresight LP and Valencia Studios NKG LLC
LA Northwest Flex/R&D
14821 Artesia Blvd, La Mirada $11,700,000 88,937 East Sunrise Investment LLC Outlook Resources Inc MidCounties Whse/Mfg
2710 Media Center Dr, Los Angeles $18,000,000 66,723 Liz General Partnership Glassell Park Associates LP LA Central Flex/R&D
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
10
New Construction
1,371,899
626,818
1,006,192
635,366
1,104,333
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
LA East LA Central LA South MidCounties LA Northwest
Current Construction by Submarket
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
11
Industrial Advisory Board Members
Central MidCounties Northwest
CBRE John Privett CBRE Rick McGeagh CBRE David Harding
Jeff Stephens Laird Perkins Coldwell Banker Commercial Alliance
Greg Barsamian
Colliers International Will Smith Colliers International Steve Calhoun Colliers International Patrick DuRoss
Cushman & Wakefield Dave Hess Chris Sheehan John Erickson
Daum Commercial Jerry Sackler Cushman & Wakefield Chuck Berger Daum Commercial Kevin Tamura
Heger Industrial Jon Reno Mike Foley Delphi Business Properties David Hoffberg
JLL Paul Sablock JLL Cameron Driscoll Jeff Puffer
NGKF Jeff Sanita Luke McDaniel JLL Bart Reinhard
NAI Capital Philip Attalla Lee & Associates Tim Cronin Lee & Associates Randy Kobata
The Quantum Associates Iqbal Hassan Joel Hutak NAI Capital Chad Gahr
Voit Dave Fults Voit Peter Castleton David Young
East South
Ashwill & Associates Mitch Ashwill CBRE Brian Held
CBRE Jason Chao Colliers International Chuck Littell
Lynn Knox Cushman & Wakefield Steve Bohannon
Colliers International Will Kim Daum Commercial Rudy Lara
Tony Phu Daum Commercial Andrew Lara
Cushman & Wakefield Stu Milligan Daum Commercial Casey Mungo
Daum Commercial Charles Johnson Gateway Business Properties
Mike Kantor
Lee & Associates Jeff Bethel Heger Industrial John Bowman
Christopher Bonney JLL Harvey Beesen
Todd Launchbaugh JLL Barry Hill
NAI Capital Ryan Campbell Lee & Associates David Bales
Rich Horn NAI Capital Philip Attalla
NGKF Rick Sheckter The Klabin Company David Prior
2016 Q4 Market Trends © 2017 by Xceligent, Inc. All Rights Reserved
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This information has been obtained from sources believed reliable. While we do not doubt its accuracy, we
have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to
independently confirm its accuracy. For more information, please contact :
Xceligent Los Angeles Team
Produced in partnership with
Matt Nelson Director of Analytics 714-509-1404 [email protected]
Monique Ebel Director of Research 714-538-8432 [email protected]
Mike Foxworthy VP of National Accounts 805-807-6291 [email protected]
Pablo Dresie Sales Executive - South Bay 310-916-7394 [email protected]
Sam Vaden Sales Executive - Central 305-335-7893 [email protected]
Mark Masliah Sales Executive - West LA 818-634-8431 [email protected]
Danny Teng Sales Executive - San Gabriel Valley 626-319-3640 [email protected]
Rebecca Johnson Sales Executive - San Fernando Valley/
Ventura County 310-663-0184 [email protected]
Tim Hayes Executive Director - AIR 213-687-8777 [email protected]
Brad Hauser VP of Analytics - Western Region 281-782-3944 [email protected]