Like its harbors, airports and freeways, the Los Angeles industrial market is becoming clogged. Buildings are scarce and sale pricing is unimaginably high. Land values and constructions costs make it expensive to build new. Meanwhile Seller’s options are limited by capital gains (although relatively low for the moment), lack of suitable replacement properties, and unwieldy ownership structures.
Continue reading “Overcoming Space Scarcity”
The 1 million square foot air freight development in Hawthorne is being delayed, in part, by a threatened lawsuit from neighboring city of Gardena. Interestingly, the city of Hawthorne voted to exclude this one major development from its own moratorium of anti-trucking development.
Continue reading “Politics Of Trucking”
View Los Angeles Industrial Features in a larger map
Industrial property is not going away, but it’s changing. Overall, only the best located properties or those that are adjacent to existing residential will be conversion candidates. Those industrial buildings safely tucked away in M-zoned districts will be protected. Whether there will be productive businesses for the older buildings is another question. The price difference between low-clear industrial and modern distribution space continues to widen.
We have a $3 million dollar project near the 200-acre Goodyear Tract located at Slauson Avenue and Avalon Boulevard.It is one of the older manufacturing centers in Los Angeles. Pricing is roughly 30% lower than other properties along the 110 Corridor. Obsolescence and neighborhood factors are the biggest reasons that you can find rents in the mid-$.20’s and sale prices in the mid-$30’s.There are a lot of lessons here that can apply to other parts of Los Angeles where manufacturing is either disappearing or adapting.
South Bay continues the same pattern over the past 2 years. Buildings for sale are in demand and buildings for lease languish. There is considerable interest for smaller buildings and developers have taken this cue. New small building projects are under construction with asking prices in the $110 to $135 per square foot range depending on location.
Continue reading “South Bay Pricing Trends”