A decade in comparison – Los Angeles emerges as one of the tightest, most sought-after industrial infill markets in the country
Over the past decade, the Los Angeles industrial market has emerged as one of the most sought-after infill markets in the county.
February 10, 2020
- Driven by the rise and projected growth of e-commerce sales, investors and e-retailers continue to vie for warehouses closer to the city center in a competitive race to offer one-day delivery to an expanding consumer base. The increases in asking rates and sales prices over the past decade underscore this demand for last-mile delivery facilities: the average asking rate is up 67 percent and users and investors are paying over 3 times more per foot for warehouses.
- While lease term lengths and concessions—such as free rent—have stayed relatively consistent, the average asking rent continues to reach new all-time highs, quarter after quarter. Rent only constitutes roughly 5 percent of warehouse’s total operating costs, suggesting landlords still have a fair amount of runway left to push rents even higher. And from a tenant’s perspective, proximity to an expansive consumer base and to the most active port complex in the nation is paramount, which will ensure Los Angeles’ position as one of the most competitive industrial markets in the country.
Source: JLL Research