Snapshots

A decade in comparison – in Orange County, it’s a great time to be an industrial landlord!

The Orange County industrial market is a landlord’s paradise and they have undoubtedly capitalized on the insatiable demand in various ways.

January 28, 2020
  • In the last decade, lease rates and sale prices have increased by more than 90 percent each! Tenants are continuously willing to pay a premium to operate their business in this market. Investors looking to capitalize on this high demand are pushing sale prices to never-before-seen heights. 
  • Moreover, this upwards push has even incentivized longtime owner-users to sell their properties only to directly lease them back, granting them access to the profits of the sale to reinvest into their business elsewhere. In the last ten years, 37.7 percent of all sale-leasebacks occurred in 2019 (for properties 50,000 square feet and greater).
  • Landlord leverage has even seeped over to other lease terms including tenant improvements, free rent and lease duration, showing that landlords are calling the shots in every sense of the term. 
  • Deliveries in 2019 were slim but 1.2 million square feet in the pipeline for 2020 will create more competition on the supply side in the new year. 

Source: JLL Research