San Diego Industrial Market Recap: Q4 2014

Posted on February 19, 2015 ยท Posted in Trends

San Diego’s industrial market finished strong in 2014 and as a result the overall industrial market saw tremendous growth that should begin to put serious upward pressure on average asking rates throughout 2015.

Net absorption was positive for the 10th straight quarter with a massive increase of 881,000 square feet in Q4 alone and for the year finished up 3.3 million square feet. However overall asking rates did not follow the trend because even though they are up 25% compared to Q4 2011, 2014 saw average rates only grow a single cent to $0.99.

Part of the strong finish in Q4 was tied to employment growth as Q4 saw 24,000 new jobs open up in the transportation/distribution/manufacturing sector and those accounted for nearly 60% of the overall local industry growth for the year. As a result of the strong industrial growth, the first speculative industrial project since the recession broke ground in Q4 2014.

Even though asking rate growth has been slow over the past year, market conditions will likely see them begin to appreciate at a much faster rate in 2015 which is why it’s important to work with a tenant advisory firm like Synergy to make sure you get the best possible deal on your next industrial lease or purchase.