Demand for logistics space drives LA’s industrial boom

Inland Empire’s 2 percent vacancy rate in May was lowest in nation

Los Angeles /
Jul.July 07, 2021 09:03 AM
Development is accelerating since a brief slowdown brought on by the pandemic (Getty)
Development is accelerating since a brief slowdown brought on by the pandemic (Getty)

The Los Angeles-area industrial market tightened by nearly every metric in May, thanks largely to strong demand for logistics space.

The Inland Empire’s miniscule 2 percent vacancy in May was the lowest in the nation, according to Commercial Observer.

Average monthly rents there increased 7.1 percent year-over-year for the month, reaching $6.32 per square foot.

A lack of supply in L.A. is driving tenants, developers, and investors to the Inland Empire region.

Rent there is significantly cheaper than in L.A., where price-per-foot rose 6.7 percent year-over-year to $9.97. The national average is $6.59 per square foot.

Inland Empire also has 17.8 million square feet of industrial construction in the pipeline compared to 7.6 million in L.A., according to the report.

Across the region, industrial development is accelerating since a brief slowdown last year brought on by the pandemic. Around 2.9 million square feet of industrial space is currently under construction in L.A. County, and about a third of that is set for completion this quarter.

The industrial boom hasn’t all been good. The rise has worsened air quality in the region, enough to draw attention from regulators. The South Coast Air Quality Management District has considered tightening regulations to push operators to lower emissions. It said vehicles and equipment used for warehousing operations emit 12 percent of nitrogen oxides released into the air above L.A., Orange, Riverside, and San Bernardino counties.

[CO] — Dennis Lynch 






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