Rental rates continue to grow while the market starts to show a slowdown
The Inland Empire’s overall vacancy, one of the lowest in the nation, increased 70 basis points (bps) over the last quarter to 2.2%. This is also up 70 bps from the total vacancy rate of 1.5% recorded one year ago. Despite this increase in vacancy, market conditions are the healthiest in the nation due to the demand for e-commerce fulfillment, last-mile supply chain space and proximity to the Los Angeles and Long Beach ports. Much of the quarter’s leasing activity was seen in the Inland Empire East submarket, with three deals over 1.0 million square feet (msf). Of these deals, two were renewals. Skechers USA Inc. signed a 1.0 msfdeal in Banning, while Under Amour Inc. renewed 1.2 msfin Rialto and Hanes Brands Inc. renewed 1.3 msfin Perris. The largest lease deal in the Inland Empire West submarket was Nestle’s renewal of 814,186 square feet in Mira Loma.