The Orange County industrial market started 2020 off very strong during the first quarter, took a hit in the second quarter due to the pandemic, then roared back in the second half of the year due to the demand for warehouse and distribution properties as much of the consumption economy shifted to online purchasing.
Job gains between October and November reported an increase of 16,500 jobs. Transportation, warehousing and utilities were up 800 jobs for the month with construction jobs seeing the largest month-over decrease, down 3,100 jobs.
The Port of Long Beach processed 783,523 Twenty-Foot Equivalent Units (TEUs) in November, accounting for a 30.6% increase from November 2019. The surge in cargo shipments have been correlated to a combination of recent holiday shipments, consumer expenditures, and warehouses replenishing inventories and storing safety stock.
Ecommerce sales grew at a rapid rate of 40.3% from the prior year, as a result of local stay at home and social distancing restrictions.
As the country awaits the widespread distribution of vaccinations, we can expect ecommerce sales to continue to grow in 2021. Furthermore, demand fundamentals should remain stable as more businesses look to convert to online sales.
WAREHOUSE & DISTRIBUTION RBA: 229,913,578 SF
AVERAGE RENTAL RATE (NNN): $1.01
DIRECT VACANCY RATE: 2.5%
SUBLET VACANCY RATE: 0.6%
VACANCY TOTAL: 3.1%
2020 LEASING ACTIVITY: 12,272,445