Cushman & Wakefield’s Steve Bohannon was a featured speaker at RENTV’s recent State of the Market Conference on October 18 at the Embassy Suites LAX South. Steve, a Senior Director in the firm’s Long Beach office who specializes in industrial brokerage, was featured on a panel alongside Brandon Carrillo of Lee & Associates and Patrick Schlehuber of Rexford Industrial Realty where they provided an in-depth look at the South Bay industrial markets over the past year.
The South Bay, located in the southwest corner of Los Angeles County, benefits from its proximity to the Port of Los Angeles and Port of Long Beach and is an increasingly flourishing industrial market. The panelists discussed the explosive growth of e-commerce and its impact on real estate in the area, as the increased demand for last-mile infill distribution facilities makes both available space and land scarce.
In addition to e-commerce, demand has also been fueled by record port volume, with the Port of Long Beach up 28.31% from September 2016 and the Port of Los Angeles up 2.15% since then. Total volume is up 8.52% over 2016 with 12,456,713 total TEUs.
Greater Los Angeles has the lowest vacancy of any major industrial market in the country with 1.2%, according to Cushman & Wakefield research, and properties are being sold and leased at record rates and speeds.
Rancho Pacifica Industrial Park, a 1,170,806-square-foot master-planned property in Rancho Dominguez, sold for $210.5 million in July 2017. The industrial business park, composed of six Class A industrial buildings on more than 55 acres of land, sold to Rexford Industrial Realty in a deal brokered by Cushman & Wakefield brokerage professionals.
Limited available product is being leased quickly and at high rents. Major leases this year included The Brickyard in Compton, a 479,310-square-foot warehouse leased to Best Buy; Watson Industrial Center in Carson, a 221,050-square-foot property leased to Dependable Highway; Pacific Pointe East in Long Beach, a 110,940-square-foot property leased to Human Touch; and 19600-19688 Van Ness Ave., a 109,544-square-foot property in Torrance leased to Brookvale International.
Steve also discussed his team’s construction projects currently underway, such as 20333 Normandie Ave. in Torrance, 11600 Alameda St. in Lynwood, and 12901 S. Western Ave. in Gardena. To satisfy demand for new, modern industrial facilities, development activity has been healthy with 1.2 million square feet under construction at the end of the third quarter.
Click here to view Cushman & Wakefield’s Q3 Greater Los Angeles Industrial Snapshot