If you want to know how popular e-commerce has become, look no further than the Inland Empire industrial market.
Vacancy fell to 1.4 percent in the second quarter, the result of an increase in lease renewals and more aggressive first-time leasing, according to CBRE.
Lease rates in the second quarter rose to 72 cents a square foot, a 24.1 percent year-over-year increase. Rents grew 29.1 percent on the east side and 19.4 percent on the west side.
Overall industrial activity in Riverside and San Bernardino counties totaled 28 million square feet, a 42.4 percent increase compared with the second quarter of 2020.
While the report mentions it only briefly, the pandemic – which caused an explosion in online shopping – continues to benefit the Inland industrial market, which was posting strong numbers before the pandemic started.
“The Inland Empire is on pace to have a banner year in leasing and sales activity,” the report states. “With gross activity exceeding 28 million square feet through the first half of 2021, the [Inland region] is bearing the fruits of pent-up consumer demand and e-commerce users.”
E-commerce sales grew nearly 40 percent year-over-year in the second quarter. As a result, available warehouse space in the two-county region dropped to 4.5 percent, the lowest availability rate in the region’s history.
That trend is expected to continue through the end of the year, CBRE reported.