SOCAL INDUSTRIAL REAL ESTATE SNAPSHOT ~ JUNE 2013 ~ INDUSTRIAL IS ON THE BOTTOM ABOUT TO RISE
May 31, 2013 on 9:12 am | In Bravo, Charts + Statistics, Economy, Investment Opportunities, Market Snapshot, Trends, Uncategorized | 2 Comments
by Jodi Summers
We be growing…2012 estimates from the Los Angeles Economic Development Corporation reveal that California surpassed Italy to become the eighth largest economy in the world. Locally Los Angeles County remained in 21st place behind Saudi Arabia and Switzerland, and ahead of Norway, Iran, Sweden, Belgium and Poland.
Our economy is growing and so is the interest in SoCal warehousing. Demand is anticipated to outpace supply through 2014 and rents finally beginning to rise again, notes CoStar.com As the local warehouse market has been sliding since mid-2008, commercial real estate investors are increasingly interested in placing capital in the warehouse sector. 
Very little new warehouse space is being delivered in Los Angeles. Current Los Angeles market trends data indicates an increase of +0.6% in the median asking price per sq ft for Industrial properties compared to 4Q 2012, with a decrease of 0.6% compared to last year’s prices. Loopnet observes that county-wide, asking prices for Industrial properties are 0.4% higher – at $131 per square foot – compared to the current median price of $138 per sq ft for Industrial properties in Los Angeles, CA.
Los Angeles County has nearly 10 million residents, spread out over 4,752.32 square miles, We are the most populous county in the nation, and larger in population than 42 states. L.A. is one of the original counties, created when California became a state in 1850. The county has 88 cities, of which the city of Los Angeles is the largest, followed by Long Beach, Glendale, and Santa Clarita.
Los Angeles County entered 2013 with momentum from a county labor market that accelerated during the second half of 2012. Nearly all of the major private sector industries added jobs in 2012, paring nearly two percentage points off our hefty unemployment rate.
The California seasonally adjusted unemployment rate was 9.0% in April 2013, 9.4% in 
March 2013, and 10.7% a year ago in April 2012. The comparable estimates for the nation were 7.5% in April 2013, 7.6% in March 2013, and 8.1% a year ago.
International trade continues to play an important role in the local economy. The San Pedro Bay ports of Los Angeles and Long Beach are the two largest container ports in the nation. Much of the nation’s imported consumer goods from Asia and the Pacific Rim enter the United States through the twin ports. While the number of TEUs (twenty-foot equivalent units) moving through the ports edged up by 0.9% from 2011 to 2012, the value of two-way trade through the Los Angeles Customs District, a broader measure of trade volume, rose by 4.3% last year to a record $403.4 billion. Two-way trade should increase by 3.0% this year, and accelerate to a 4.9% growth rate in 2014 as prospects improve for the U.S. and its trading partners.
The industrial property rental market is reacting well to all this good news. The average asking rental rate per sq ft/year for Industrial properties in LA as of March 2013 was $123.39. This represents an increase of 1.6% compared to the prior 3 months, with an increase of +4.6% year-over-year. County-wide, average rental rates in Los Angeles are +0.8% higher at $105.06 per sq ft/year for Industrial properties currently for lease. Demand is translating into quick occupancy gains and a deepening, widening recovery.
Experts say the Los Angeles County economy will continue to show improvement in 2013 and 2014, barring an unforeseen pullback in the national economy. Population
should eclipse the 10 million mark by 2014 and employment should approach four million. They say it may be 2015 or 2016 before nonfarm employment exceeds the peak of 4.12 million reached in 2007.
With money and good flowing, lease rates on the rise, the future is promising for industrial properties. Manufacturing is growing and job expansion in transportation and utilities are outpacing all service-related sectors. Movement of goods measured in truck tonnage is doing well, while intermodal rail traffic was up 5% in the first 13 weeks of 2013 compared to the same period last year.
Growth is predicted for the Los Angeles industrial real estate market. If you want to get in the game, the value is now.
For more information please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.
**
http://www.socalindustrialrealestateblog.com/?p=1816
laedc.org/reports/2013-14EconomicForecastandIndustryOutlook.pdf
IRON EXPORTS
April 28, 2013 on 1:48 pm | In Bravo, Economy, Fascinating Information, New Developments, Uncategorized | No CommentsEnjoy this enlightening video about how iron ore, an important global commodity, has become a promising new export at the Port of Long Beach.
SOCAL INDUSTRIAL REAL ESTATE SNAPSHOT ~ APRIL 2013 ~ INDUSTRIAL WILL IMPROVE 4 THE NEXT 3 YEARS
March 30, 2013 on 6:13 pm | In Charts + Statistics, Economy, Investment Opportunities, Market Snapshot, Uncategorized | No Commentsby Jodi Summers
“Demand for industrial space will drive the U.S. economic recovery and California,” heralds the first quarter 2013 UCLA Anderson Forecast.
“Industrial markets are going to be improving over the next three years,” proclaims Jerry Nickelsburg, Senior Economist for the Forecast.
California Industrial Space is the story of two prominent markets: manufacturing and warehousing. Los Angeles covers the gamut. Orange County, San Francisco, East Bay and Silicon Valley are proportionately more manufacturing. The Inland Empire is proportionately more warehousing. 
Our recent slowdown has to do with exports, Asia and Europe slowdowns impacted our recovery, keeping the demand for warehousing low. That pendulum is already swinging in the other direction. Port of Long Beach terminals saw a dramatic increase in cargo in February, moving 36.6% more containers that February 2012 ― including a nearly 46% surge in imports and a 17.2% jump in exports.
The Anderson Forecast statistics are further behind. They note that in December 2012, the industrial real estate index turned upward for Orange County, Inland Empire, and East Bay as plans for new additions to industrial space moved forward. San Francisco remained unchanged. Los Angeles and Silicon Valley were waiting to emerge….but now that’s shifted as 1Q 2013 draws to a close.
“We’re expecting an increase of demand of California products in Asia,” noted Nickelsburg, “that increases the demand for industrial space and office space.”
Expectations have become reality. Pundits have an optimistic outlook through 2015 with all of the composite sentiment indices well above an uncaring 50. With its resilient high-tech sectors, Silicon Valley holds its superiority in the industrial space market in California with a composite index of 78, followed by Orange County (76), East Bay (75), San Francisco (74), Inland Empire (68), and Los Angeles (63).
Concluded Nickelsburg, “People are starting to spend more, increasing the demand for warehouse space.”
We’re here to help you with your real estate needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.
And now, enjoy Jerry Nickelsburg, Senior Economist for the UCLA Anderson Forecast talking about the strengthening California industrial real estate marketplace.
**
http://uclaforecast.com/allenmatkinsCRES/
http://www.socalindustrialrealestateblog.com/?p=1718
http://www.youtube.com/watch?v=8f1wUAkNMZE
http://www.busjournal.com/content/archives/1210/img/pictures/ucla%20forecast.jpg
SOCAL INDUSTRIAL REAL ESTATE SNAPSHOT – MARCH 2013 ~ GROWTH THROUGH STUFF
March 1, 2013 on 10:18 pm | In Economy, Fascinating Information, Investment Opportunities, Market Snapshot, New Developments, Trends, Uncategorized | No Commentsby Jodi Summers
It’s in the cards. In the future, we’re going to buy more stuff, build more stuff, make more stuff and warehouse more stuff, and these activities will keep SoCal industrial real estate market strong. Experts say the wide array of economic and real estate expansion that we are currently noticing around town will support healthy employment activity over next two years. This year, countywide employment is predicted to grow by 61,000 positions, or 1.6%, followed by 72,000 new hires in 2014, an increase of 1.8%.
Much of this new employment is coming in the way of new construction, and is good for the industrial market. Why kind of new construction, you wonder? Check out these billion dollar projects:
* Our football stadium, Farmers Field, was finally approved by the Los Angeles City Council in a 12-0 vote on September 28, 2012. The $1 billion, 78,000-seat stadium downtown in downtown will double the size of the Convention Center.
Soon, Los Angeles will be able to host an NFL team < this hasn’t happened since the Rams and the Raiders left Los Angeles at the end of 1994.
Construction of the project is anticipated to generate over $1.7 billion for the local economy, and add nearly 20,000 full-time jobs resulting from direct and indirect operations.
* The Tom Bradley International Terminal is undergoing a $1.5 billion renovation and expansion project that will be complete this year. This modern engineering marvel will feature 18 roomier boarding gates with nine built for new-generation aircrafts. The project is using recycled building materials and is expected to achieve a LEED Silver certification from the U.S. Green Building Council, as well as a host of other architecture and design awards.
The passenger experience will be enriched by upgraded customs/immigration and federal security screening areas for more efficient processing, as well as secured corridors so connecting passengers can travel between the New TBIT and Terminals 3 and 4. New state-of-the-art, baggage-handling systems will improve passenger wait times and speed travelers through the ticketing process.
Fyi, LAX is the sixth busiest airport in the world and third busiest in the United States, offering more than 600 daily flights to 91 domestic cities and over 1,000 weekly nonstop flights to 58 cities in 32 countries on nearly 75 air carriers. In 2011, LAX served more than 61.8 million passengers, processed more than 1.8 million tons of air cargo valued at nearly $84.6 billion, and handled 603,912 aircraft operations (landings and takeoffs).
* And the award for entertainment development goes to the Grand Avenue redevelopment project. Plans call for a $3 billion, 3.2 million-square-foot project near the Walt Disney Concert Hall in downtown Los Angeles. The project will include 2,600 residential units, 449,000 square feet of retail space, a five-star hotel, and a 16- acre park. The development is expected to support 5,900 permanent positions. The wide array of economic and real estate expansion will support healthy employment activity over the two-year forecast period. This year, countywide headcounts will grow by 61,000 positions, or 1.6%, followed by 72,000 new hires in 2014, an increase of 1.8%.
* And let us not forget our much-anticipated Expo Line light rail. The Expo Line will run from downtown Los Angeles to Santa Monica in approximately 46 minutes – even during rush hour. The 15.2 mile Expo Line will bring light rail to the Exposition Corridor, with 19 stations. Service on Phase 1 began service to the Culver City station on June 20, 2012. Phase 2 will extend the line out to Santa Monica and construction is scheduled to be completed in 2015. Estimated costs for the project are $930 million for Phase 1 and $1.5 billion for Phase 2. By 2030, an estimated 64,000 passengers are expected to ride the Expo Line each day – which would make it one of the most heavily used light rail lines in the country.
Those with a vision, see our growth. Be a part of the plan, buy more stuff, build more stuff, make more stuff and warehouse more stuff.
We’re here to help you with your real estate needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.
**
http://www.socalindustrialrealestateblog.com/?p=1694
http://www.youtube.com/watch?feature=player_embedded&v=avi7aSwzqXE
http://creativenvironments.net/blog/wp-content/uploads/2009/12/grand-ave-2.jpg
http://en.wikipedia.org/wiki/Farmers_Field
http://venturebeat.files.wordpress.com/2012/11/buy-more-stuff.jpg
http://latimesblogs.latimes.com/lanow/2012/01/lax-renovation.html
http://www.apartmentupdate.com/index.cfm?fuseaction=markets.main&mktpage=861&login=1
LOS ANGELES INDUSTRIAL REAL ESTATE SNAPSHOT ~ JANUARY 2013 ~ THE NEW YEAR IS GOING TO BE GOOD
December 30, 2012 on 2:01 pm | In Bravo, Charts + Statistics, Economy, Fascinating Information, Investment Opportunities, Market Snapshot, New Developments, Trends, Uncategorized | 3 Commentsby Jodi Summers 
Happy New Year’s! 2013 is going to be a prosperous year for Los Angeles Industrial Real Estate. Our market is off the bottom and climbing. It will be happy year. If you want to buy or sell industrial properties in Los Angeles, now is the time – {Contact us @ (310) 392-1211 – we can facilitate your transaction.} There is very little inventory in the LAX-area market. Buyers are sifting through limited inventory – Increased demand, limited supply – both sale prices and lease rates are on the rise.
SoCal is known for being the deepest and largest industrial market in the nation, with LA and Orange counties having the lowest and second-lowest vacancy rates at 2.4% and 3.8%, respectively according to CBRE. (Btw, the Inland Empire ranks ninth-lowest at 6.3%.) Low vacancy rates mean inventories are sparse, declining 16.9% over the last year in the Los Angeles Metro Area.
Prices are way down too…the average asking price for industrial properties in the metro area is approximately $131.39 per square foot, down 2.9% from the previous year, calculates Loopnet. Asking prices for industrial properties reached a three-year high in February 2008 at $198.40 per square foot. The three-year low was $131.09 in May 2012. We are rising off the bottom…and prices are rising. The median sale price per square foot for industrial properties in the metro area climbed 5.7% in the second half of 2012.
Savvy owner-users are buying into the sometimes pricy Westside industrial market thanks to Small Business Administration loans. The SBA had its largest volume of financing ever in fiscal 2012. (FYI – SBA financing is available up to 200,000 square feet.) Watch for increased strength in the owner-user market in 2013.
Sale prices per square foot for industrial properties end the year at around $112.56, a 5.2% rise from a year ago, and 8.2% higher than the three-year-low set in January 2011. The 
highest recent median sale price was $127.91, set in October 2009.
There’s been no spec development for a couple of years – Sellers, if you’ve got an older industrial property, now is a good time to sell it to a new user. Hunky new properties will be coming on the market, now that speculative industrial development is ramping up.
“We’re tracking 16 million square feet of true spec development within our region,” calculates CBRE senior managing director Kurt Strasmann. “The Inland Empire accounts for almost 9 million square feet.”
On the leasing end, asking rents for industrial properties end the year @ around $8.81 per square foot, a rise of 0.8% on the year. Lease rates for industrial properties reached a three-year high in January 2008 at $10.85 per square foot. The lowest asking lease rate in the past three years was seen in January 2012 at $8.67. Time on the market is 150 days.
The National Association of Realtors offers a positive nationwide outlook. Their reports find that the areas with the lowest industrial vacancy rates currently are Orange County, CA, with a vacancy rate of 4.3%; Los Angeles – 4.4%; and Miami at 6.5%.
Throughout the Country, industrial vacancy rates should decline from 10.1% in 4Q 2012 to 9.5% in 4Q 2013. NAR reasons that annual industrial rents rose 1.7% in 2012 and will climb 2.2% next year. Net absorption of industrial space nationally will probably total 93.4 million square feet this year and 89.6 million in 2013.
As for the strength of our market, let’s conclude with the stats of CBRE senior managing director Kurt Strasmann. “The best indicator is that we’re tracking 16 million square feet of true spec development within our region, of which the Inland Empire accounts for almost 9 million square feet.”
We’re here to help you with your commercial and investment property needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.
**
http://www.loopnet.com/Los-Angeles_California_Market-Trends
http://www.socalindustrialrealestateblog.com/?p=1590
http://www.scribd.com/fullscreen/116742486?access_key=key-1on4f9dkq5d9bz8mcjb9
http://2013-wallpapers.blogspot.com/2012/07/happy-new-year-wallpapers-2013.html
http://new.usgbc.org/sites/default/files/imagecache/fixed_670-308/construction.jpg
THE SOCAL INDUSTRIAL REAL ESTATE SNAPSHOT ~ NOVEMBER 2012 > FOCUS ON THE PORT OF LONG BEACH
October 31, 2012 on 7:30 pm | In Charts + Statistics, Economy, Fascinating Information, Uncategorized, world | 2 Commentsby Jodi Summers
Buyers jump on new properties > the SoCal industrial real estate market is currently as viable as it is going to be! Sales are slow, prices are down, and loan rates are great. What are you waiting for? If you’re not buying, perhaps the most interesting bit about Los Angeles’ stagnant industrial real estate market in the past month, was the annual tour of the Port of Long Beach.
Founded in 1911, the 3,200-acre Port of Long Beach is a premier gateway for trade between the United States and Asia. Today it is the second-busiest seaport in the United States (the Port of Los Angeles being #1) and a key transportation hub in the global trade marketplace. More than $140 billion worth of cargo moves through the Port every year – everything from clothing and furniture to machinery and petroleum. East Asian trade accounts for about 90% of the shipments through the Port. The Port’s top trading partners 
are China, South Korea, Hong Kong and Japan.
The Port is a major transportation and trade center, providing the shipping terminals for nearly one-third of the waterborne trade moving through the West Coast. At its peak production in 2010, the Port moved more than $140 billion in goods. It supported about 1.4 million jobs in the U.S. and generated about $15 billion in annual trade-related wages.
In September, at both the Port of Long Beach and the Port of Los Angeles, exports declined as the global economy continued to slow down. The Port of Los Angeles reported 172,433 loaded outbound TEUs – Twenty-foot equivalent unit) in the month of September, down 2.6% from September 2011. The Port of Long Beach saw 2.8% drop to 114,902 loaded 
outbound TEUs in September of this year. During the past six months the slowdown in Chinese economic growth has not only negatively impacted exports to China but to all of our other top trading partners in the region as well.
Loaded inbound traffic at the Port of Long Beach increased 0.7% and Port of Los Angeles rose by 3.4% percent from September 2011 to September 2012, but having said that, port numbers were down during the summer months.
Port cargo to increases and decreases due to global economic cycles. When economies are strong, consumers buy more products and factories buy more raw materials. For example, Americans buy more Chinese made toys, while Chinese factories buy more American recycled plastic. There was a steep decline in cargo volumes during the recent recession.
The Port of Long Beach and the Port of Los Angeles located side-by-side in San Pedro Bay. The two ports are separate entities that work in tandem. The number of cargo containers shipped through the two ports gives them the honor of being the largest port complex in the United States as well as the world’s sixth busiest port complex.
The Port of Long Beach is operated by the City of Long Beach. The Port of Los Angeles is operated by the City of Los Angeles. The two ports compete for business, but cooperate regularly on various areas including security, infrastructure projects and environmental programs.
Next post, port statistics…
We’re here to help you with your commercial and investment property needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.
**
http://www.polb.com/about/facts.asp
http://laedc.org/business-assistance/additional-resources/e-edge-newsletter/#3
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