Inland Empire Continues Reign as E-commerce Mainstay

While it will take time for the economy to fully recover, the Inland Empire industrial market ended 2020 with low vacancy, strong absorption and record-high leasing velocity despite a challenging year. This is a sign that the IE industrial market, the mainstay of e-commerce, continues to be resilient through the crisis.

In fact, the Inland Empire industrial market achieved another record this quarter, posting the highest amount of positive absorption in the market’s history, according to a recent report by JLL.

To be sure, container volumes at the Ports of Los Angeles and Long Beach have been setting records in recent months. Quarter-over-quarter, vacancy dropped a staggering 160 basis points as a majority of the leases that were signed in third quarter 2020.

Furthermore, an additional 19.1 million square feet of leases were signed in fourth-quarter 2020. This is the second highest total in the market’s history, just behind Q3’s 19.8 million square feet. Concurrently, the development pipeline slowed in recent quarters and available product is dwindling as result. Despite 19.7 million square feet of newly constructed product delivering this year, there is still a shortage of quality space. As a result, rents climbed 8.8% in 2020.

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