East Bay industrial demand stable as surrounding markets show signs of softening
As market compression in the nearby Silicon Valley is causing demand to soften, demand in the East Bay is stable.
March 05, 2019
- As market compression in the nearby Silicon Valley is causing demand to soften, demand in the East Bay is stable. Demand dynamics in the East Bay have shifted slightly over the past year, including shrinking touring requirements and a notable decline in demand from national, corporate tenants.
- Most of the forty-six deals closed between October 2018 and February 2019 were signed by locally-based companies, with only a handful of corporate occupiers. Food & Beverage, Construction & Building Materials, and Logistics & Distribution are the top three industries for the signed deals, and the average lease size was 54,500 square feet.
- Since the fourth quarter, most activity has been dominated by Hayward. Sixteen deals were signed in Hayward from October 2018 to February 2019, compared to 10 deals a year earlier. Leasing activity in San Leandro tapered slightly between the two periods, down from 30.5 percent of activity by square footage to 21.0 percent.
- Deal activity has not been even across the East Bay where demand is softening in Livermore. As price conscious tenants migrate to the Central Valley in favor of Livermore, vacancy rose from 3.0 percent in Q4 2017 to 9.6 percent in Q4 2018.
Source: JLL Research
You may also like
Shifts in the way people live, work and shop in a post pandemic world have forever impacted the industrial real estate sector
Chestnut and Walnut Street retail visits drop precipitously in Philadelphia during COVID-19 pandemic
Pressure from distressed New York retailers has softened landlord sentiment, allowing for lease restructurings