Canan Tasci, Staff Writer
Posted: 09/28/2012 06:52:40 PM PDT
A semi drives past a 506,000 square foot warehouse for lease Friday in Ontario. (Jennifer Cappuccio Maher)
The building of warehouses in the Inland Empire is looking up just as the economy is starting to improve.
Some local experts are touting the area’s vacancy rate noting the ports in Los Angeles and Long Beach have seen a increase in cargo volume, which translates to more businesses having a need for warehousing space.
“A lot of facilities were built without the addition of much of a demand because of the recession. So these buildings opened and there was no tenants to take them,” economist John Husing said.
“Now that the worldwide recession has receded, the volumes at the ports went back up and because the most modern facilities in the country are all being built here, we’ve seen a surge in demand.”
The recession saw vacancy rates locally surge to as high as 12 percent.
Today, Husing said, the vacancy rate is under 6.5 percent. And for the very large facilities it is essentially zero, and new projects are lining up.
“Speculative builders have gone back into the business, and as fast as they’ve been building new facilities, they’ve gobbled up tenants,” Husing said.
During 2013, Carson-based building company Watson Land Co. will have broken ground on two projects in Chino totalling 2.7 million square feet.
Dirt is expected to be turned on a recently purchased site south of Kimble and Mountain avenues by April and by the mid-year at the southeast corner of Merrill Avenue and Flight Avenue for a total of seven industrial buildings.
“The industrial market throughout Southern California has recovered considerably in the last couple years, particularly out of the west end of the Inland Empire,” said Craig Halverson, Watson’s vice president of acquisition.
“We’ve seen vacancy rates are down, the average vacancy rate on the west end of Inland Empire is somewhere around 6 percent right now and absorption or demand has been really strong.
“And as we look to containers coming in through the ports of Los Angeles and Long Beach, they’re up and are strong. We’re in-line with the container counts from 2006, and that was a good year.”
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