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Aging inventory and vacant-since-delivery projects steady industrial rent growth

  • Last-mile delivery services seeking optimal access to target demographics and automotive OEMs eyeing space near tech-giants are shaping demand for industrial product.
  • Steady demand and limited product keep the vacancy rate compressed below 5.0 percent and pushes migration into the East Bay and Central Valley markets. The Valley’s aging inventory, which does not support new warehouse technology and automation trends, coupled with office development eating away at industrial inventory limits options for large block tenants.
  • While market fundamentals remain tight, newly delivered Class A buildings that have not yet been leased are constraining rent growth. Overall asking rents are relatively stable, up 0.6 percent from the previous quarter but down 3.2 percent compared to year-ago levels.​​

Source:  JLL Research

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