NAI Capital Releases Q3 2015 Outlook Report for the L.A. San Fernando Valley Industrial Market
Encino, CA, Tuesday, October 20, 2015 – The third quarter vacancy rate in the San Fernando Valley industrial market remains low at 2.3%. The vacancy rate has been below 3.0% for the past seven quarters, as reported in NAI Capital’s Third Quarter San Fernando Valley Industrial Market Outlook report. The decline is due to steady leasing and increasing sale activity. Year to date sale and lease activity totaled more than 5.8 million square feet – representing a 6.1% decrease over the same period last year. This is primarily due to a lack of available product. A strong demand to buy versus lease has increased sale activity along with prices.
According to Chris Jackson, Executive Vice President and branch manager for NAI Capital’s San Fernando Valley operations, “By any measure, a 2.3% vacancy rate is extremely low for our market causing a shortage of industrial space throughout the San Fernando Valley. Like other industrial markets throughout Los Angeles County, this has caused rents to rise significantly and driven new construction placing a spotlight on the San Fernando Valley. We are seeing an increase in lease renewals as tenants, with few alternatives, want to lock in rates where they are today in anticipation of higher rents next year.”
Demand for industrial space continues to push pricing upward while maintaining inventory levels low in the market. Average asking rents closed at $0.77/SF, up 4.8% over the prior quarter and up 11.3% over last year while sale prices for warehouse/distribution space gained over 25% from this time last year.
“The lack of available product either for lease or for sale is impeding prospective tenants and buyers from being able to effectuate expansions and/or relocations. The fundamentals of the current industrial building market are such that demand has clearly outstripped supply, which continues to push the pricing curve upwards,” added Senior Vice President, Chad Gahr with NAI Capital’s Encino office.
To access the full San Fernando Valley Industrial Market Outlook report, visit:
About NAI Capital
NAI Capital Company is one of the Southern California’s leading full-service commercial real estate organizations, providing a complete range of transaction, property management and consulting services. NAI Capital is one of the largest members of NAI Global, a premier real estate service network with 375 offices and 6,700 market leaders spanning the globe. By leveraging our local expertise with our global reach, NAI Capital offers innovative, customized solutions and seamless service to owners, corporate occupants and investors throughout Southern California. Since 1979, NAI Capital clients have built their businesses on the power of our expanding network. We are a dynamic growing commercial real estate company. At NAI Capital we work together putting our clients first.
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To learn more, visit www.naicapital.com
About NAI Global
NAI Global is the single largest, most powerful global network of owner-operated commercial real estate brokerage firms. NAI Global provides a full range of corporate real estate services, including brokerage and leasing, property and facilities management, real estate investment and capital market services, due diligence, global supply chain and logistics consulting and related advisory services. NAI Global Member firms, leaders in their local markets, are actively managed to work in unison and provide clients with exceptional solutions to their commercial real estate needs. Founded in 1978, today NAI Global has more than 375 offices strategically located throughout North America, Latin America, Europe and Asia Pacific, with over 6,700 local market professionals, managing over 380 million square feet of property. Supported by the central resources of the NAI Global network, Member firms deliver market-leading services locally and combine their in-market strengths to form a powerful bond of insights and execution for clients with multi-market challenges.
NAI Global was acquired in 2012 by C-III Capital Partners, a leading commercial real estate services company engaged in a broad range of activities, including primary and special loan servicing, loan origination, fund management, CDO management, principal investment, online capital markets, title services and multifamily property management. C-III’s principal place of business is located in Irving, TX, with additional offices in New York, NY, Greenville, SC and Nashville, TN.
To learn more, visit www.naiglobal.com.
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