Whether you make one deal in a lifetime or several a year, Occupiers look at the Space Markets one dimensionally, fixed-in time, because they need to have doors open ASAP. Only available space will do. Most times, Occupiers do not have the luxury to leverage their space commitment on the investment side. A select few, mostly those who own their own business, use space commitments as an opportunity to increase personal net worth by turning rent expense into profit.
Continue reading “How To Make Deals For Big Industrial”

The Space Market is on a different trajectory than the general economy. Industrial building prices have doubled since the Great Recession and are up over 20% from previous peaks. Rents are keeping pace and $1.00 per foot Gross for industrial in Gardena and greater South Bay is becoming the norm in many segments especially for smaller units and new, Class A Buildings. All other buildings, while renting for less, are still at all-time highs. Space shortages persist across the board. A disconnect exists between a real estate pricing surge and muddling economic conditions.
Continue reading “What’s New For Gardena Industrial – Fall 2016”

Analytic tools are essential ways to address space shortages for Occupiers or Investors. The reasons are complicated but the traditional market no longer supplies enough quality space. Online listing services do not yield satisfying choices. More aggressive tools, that emulates your precise business strategy or market expertise are needed to find deals in the era of Space Scarcity. The surest way to make deals is to create them and data is an integral part. Understanding the market comes first before developing the tools to exploit it. For instance, this is the case that better data will help you purchase Big Industrial deals…
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For Los Angeles area companies, Inland Empire (IE) is a serious contender for relocation if you do not move out of state all together. Western IE, now considered infill Los Angeles, is 45 miles from Downtown. The space ratio is generally 50% more space for the same rent and the additional cube height comes free. While new buildings are being absorbed as quickly as they are being built, there are currently several million square feet of space going through the planning process. If you are taking a big chunk of space, the time to get the best deals are just after entitlement and before construction begins. This is when developers are looking for financial partners and will consider pre-sales.
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Another trend, popular in West L.A. and DTLA, as well as other creative centers across the country is Space Sharing. Networks, mobile computing and particularly start-up finance, has made sharing office and desk ubiquitous. Many innovative industries share common production resources like equipment, processes, and costly tenant improvements in Maker Spaces. (see New Industries post). While normally more expensive on a square foot basis, the total cost of rent, on a demand and hedged basis, is much less. Compatibility, or in the Space Sharing vernacular, curation, is an essential factor easily overlooked. Having a common bond or a similar industry cluster increases the likelihood of success. The drawing below is of the LaKretz Innovation Campus in Downtown Los Angeles, a 65,000 square foot space that can be easily adapted for the changing needs of multiple occupants.

Continue reading “What Exactly Is Space Sharing?”

The Space Market is on a different trajectory than the general economy. Industrial building prices have doubled since the Great Recession and are up over 20% from previous peaks. Rents are keeping pace and $1.00 per foot Gross for industrial in Gardena and greater South Bay is becoming the norm in many segments especially for smaller units and new, Class A Buildings. All other buildings, while renting for less, are still at all-time highs. Space shortages persist across the board. A disconnect exists between a real estate pricing surge and muddling economic conditions.
Continue reading “What’s New For Gardena Industrial”