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IE industrial: inventory, lease rates both up

The Inland Empire industrial market continued to sizzle during the second quarter, its inventory rising to 622 million square feet following new deliveries.

At the same time, vacancy stayed below one percent for the fifth consecutive quarter, a sign that the industrial sector’s “explosive growth” is not slowing, according to Voit Real Estate Services.

Average lease rates rose 32 cents to $1.49 per square foot. Lease rates are up 75 percent from the second quarter of 2021, the result of a strong demand by logistics companies for first-generation space.

Net absorption – 4,761,167 square feet – was up slightly compared with the first quarter but was down from 8,530,258 square feet year-over-year.

Also during the second quarter, the Inland Empire was one of the few industrial markets in which projects are being built: 34.3 million square feet of logistics space was under construction when the second quarter ended, up from 27.9 million square feet in the first quarter.

Most projects being built were in Ontario, Fontana and Rancho Cucamonga, according to Voit Real Estate.

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