Los Angeles County Q1 2020 Industrial Market Outlook

Market Overview

The Los Angeles industrial market started the new decade on an altered trajectory in the wake of the COVID-19 global outbreak. For the first two months of 2020, the market continued where it left off with record-high rent and very low vacancy. The average asking rent reached $1.00/SF, up 1% from Q4 2019 and 5.3% from Q1 2019. The vacancy rate increased to 2.9% in Q1 as more than 2.2 million square feet of construction was completed during the quarter. Leasing and sales volumes declined slightly year-over-year at 9.5 million and 5.8 million square feet, respectively. The construction pipeline included nearly 4.4 million square feet, most of which is scheduled to deliver in 2020.

Market Outlook

Trends to Watch

Tenants evaluating their businesses; defaulting or restructuring leases
Landlords offering concessions; providing rent abatement or deferment
Rents and sales prices dropping until certainty is restored

Los Angeles County Industrial
Average Asking Rent & Vacancy Rate Graph