Top Class A institutional owners see continued growth in market share in LA
The class A market has seen significant growth since the early 2000s with 40 million square feet of new product being built during this time.
November 20, 2019
- The top five class A industrial owners of buildings over 100,000 square feet control 27.3 percent of the market share, up from 24.9 percent in 2003. This number jumps to 38.9 percent market share for the top ten owners, a 4.2 percent increase from the 34.7 percent mark in 2003.
- Prologis has been the dominant player in the Los Angeles class A market averaging nearly 8 percent of market share annually over the past sixteen years. The REIT has maintained its grasp on the industrial market through its acquisitions of KTR Capital Partners and DCT Industrial in 2015 and 2018, respectively. The company looks to grow their portfolio further in 2020, agreeing to terms with Liberty to acquire the trust in a deal valued at $12.6 billion. The acquisition will add 107 million square feet nationwide and roughly 850,000 square feet of space to their Los Angeles portfolio, bringing their LA class A ownership to just over 8 million square feet.
- The class A market has seen significant growth since the early 2000s with 40 million square feet of new product being built during this time. Top owners Majestic Realty, Thrifty Oil, Watson Land Company, and The Carson Companies have contributed nearly 8 million combined square feet of development. However, with the lack of available land in LA county, we will likely see more companies turn to portfolio acquisition as a means of acquiring quality industrial space.
- Several new entrants to the market have looked to reshuffle the ownership ranks with companies like Duke Realty, Rexford Industrial, Blackstone and Goodman entering the top fifteen after having no presence a decade ago.
- As the class A market continues to become more top heavy there is potential for the largest owners, such as Prologis, Majestic and Watson to start monopolizing rent growth.
Source: JLL Research