Second Quarter 2025
Ventura County Industrial Market Faces Rise in Vacant Space in Q2 2025
Limited construction and steady demand maintain high rents as vacant space grows, with leased square footage outpacing sales.
Ventura County’s industrial market sees surge in sales volume, though leasing outpaces sales, with constrained construction supporting elevated rents.
MARKET OVERVIEW
In Q2 2025, Ventura County’s industrial market experienced a 6.0% increase in total vacant space compared to Q1. This rise, driven by shifting demand for warehouse-distribution space, expanded existing inventory while keeping rent prices elevated. Year-over-year, vacant industrial space increased 15.2%, yet the vacancy rate remained relatively low at 2.6%.
The average asking rent rose 6.8% year-over-year, reaching $1.10/SF triple net, up 2 cents from last year’s record high. As of midyear 2025, total vacant sublease space stood at 135,070 square feet, down 7.3% quarter-over-quarter but up 174.4% compared to the same time last year.
Vacancy rates since the pandemic have remained low, largely due to limited new construction, even as rents have climbed. Most development has been build-to-suit, adding little to the vacant inventory.
Leasing volume totaled approximately 550,000 square feet year-to-date, down 9.8% from the first half of last year. Total available space has increased to around 1.7 million square feet. Tepid demand, combined with high interest rates, rising construction costs, and a slowing economy, has kept speculative development in check.
As availability rises, the measured pace of speculative construction has limited the supply of large, state-of-the-art warehouse-distribution facilities, helping hold vacancy steady. Despite the slowdown in e-commerce growth post-pandemic, demand for small to mid-sized warehouse space, particularly for last-mile distribution, remains steady.
Meanwhile, increased availability of for-sale industrial product has led to a 164.7% year-over-year increase in square footage sold as of midyear, as owner-users seize opportunities.
TRENDS TO WATCH
The market is expected to continue sustaining elevated rent and sale prices, as the absence of speculative construction helps maintain low vacancy levels. While demand is trending lower, businesses seeking large, state-of-the-art facilities will face limited availability. Elevated interest rates have contributed to a slowdown in industrial building sales, but owner-users continue to drive sale activity.
In Central Ventura County, leasing volume declined 10.9% year-to-date compared to the same period last year. Only two sale transactions were recorded in Q2, bringing the year-to-date total to five—up from three during the same period in 2024. A notable transaction involved local developer Decker-Goetsch Properties, which sold a newly completed 68,807-square-foot, state-of-the-art warehouse at 3400 Calle Tecate in Camarillo for $23,365,000, or $509.49 per square foot. The buyer, Custom Packaging Supply, Inc., acquired the facility to accommodate its expanding operations—highlighting ongoing demand from owner-users, as the vacancy rate in Central Ventura rose to 3.6%, the highest in the county.
West Ventura remains the tightest submarket, with a vacancy rate of 1.7%, down 10 basis points from the prior year. While leasing volume more than doubled quarter-over-quarter, year-to-date leasing activity is down 30.0% due to limited available space. Sales volume also declined, falling 11.6% year-over-year.
North Ventura’s vacancy rate increased to 3.3% in Q2, up 80 basis points from a year ago. However, combined sale and lease activity in the region rose 53.7% year-to-date, indicating healthy deal flow supported by rising inventory.
Countywide, Ventura’s industrial market saw a 9.8% decline in leasing volume during the first half of 2025, while square footage sold surged 164.7% year-over-year as of Q2. Despite the sharp increase, total square footage sold remained lower than the amount leased. Developers remain cautious, closely monitoring the impact of diminishing available space, but high construction costs and elevated interest rates continue to dampen confidence in launching new projects.
Tenants considering a purchase must weigh the impact of rising borrowing costs on their capital strategies. While higher interest rates may temper sale activity, limited supply is expected to support elevated average sale prices, particularly for high-quality industrial space. With construction activity restrained and a continued shift toward leasing over ownership, pricing for warehouse-distribution space will remain a key focus through the second half of 2025.
