Los Angeles industrial real estate market report
Q1 2024
The Los Angeles industrial market continued to fall back to earth after growing at record setting pace in 2021 and 2022. Contract negotiations at the LA Ports back in 2023, led operators to seek alternative shipping ports to prevent delays. Currently, contract negotiations at the Gulf and East Coast Ports, set to expire on Sept. 30th, could prompt operators to return back to the West Coast ports, potentially driving demand upward for the Los Angeles industrial market.
Net absorption
2024 began with a negative net absorption of over 4.8 million square feet. This is over 4.5 million square feet lower than the previous quarter, and is the largest quarter-to-quarter drop since Q1 2023.
Lease rates
Average asking NNN lease rates have increased in Q1 2024 to $1.76 per square foot. This marks an escalation of $0.01 from the previous quarter.
Vacancies
Vacancies continue to climb to new highs for the LA Industrial Market, with direct vacancies at 4.6%, and sublet vacancies at 1.0%.
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