1. INLAND EMPIRE INDUSTRIAL STATS – Q 2 - 2016
WEST COUNTY INVESTMENTS
COSTAR RESEARCH

2. Inland Empire Q2 Industrial Stats
Existing Properties: 12,029
Under Construction: 59
Spaces for Lease: 1,003
Existing RBA: 550,871,500 SF
Vacant Space: 26,873,660 SF
Vacancy Rate: 4.9%
Q Net Absorption: 5,755,070 SF
Average Asking Rent: $0.52 Gross

3. Job Growth in Thousands Last 6 Months By Industry

4. Submarket Inventories
Inventory for the Submarkets as of June 2016
Airport Area has the largest inventory while cochlea valley has the largest amount of deliveries within the past 12 months and North San Bern has the highest amount of SF currently under const.
West San Bern is currently tracking with the highest year growth in rental rates at 24.3 %
Submarket Inventories

5. Job Growth Last 6 Months Job Growth Last 6 Months
Job growth has returned to the Inland Empire. Following several years of uninspired economic performance, the metro’s employers stepped up the pace of hiring, and employment has grown at a faster rate than the U.S. average since While employment growth in 2015 is expected to continue to outdo the U.S. average, the loss of Southern California Edison to LA was a blow to the metro.
Job Growth Last 6 Months

6. Rental Rates Are On The Rise.
Rental rates are growing but will level off over time
Economist put this to

7. The Industrial vacancy rate in the Inland Empire market area decreased to 5.0% at the end of the second quarter The vacancy rate was 5.2% at the end of the first quarter 2016, 5.1% at the end of the fourth quarter 2015, and 5.2% at the end of the third quarter 2015
Vacancy Rates

8. Delivers are outpacing the Net absorption for the year with vacancy starting to climb a bit and leveling off around 8.6%

9. Thus far we have around 1,000,000 SF that has begun construction this year
Construction Starts

10. FOR SALE
Above all else, this market relies on trade—specifically, imports from Asia. Last year growth at the ports was dismal
due to labor issues. As a result of the interruption in service, many importers threatened to diversify where their goods land
around the country, a strategy that would only be helped when the ports on the East Coast are ready for the post-Panamax
ships. That said, the ports of LA and Long Beach will always be the preeminent recipients of Asian imports. While this will
remain a large opportunity

11. Price Per SF at Sale.
While varying it is trending near $112 PSF

12. 3 biggest sales as of June 2016
Selected Top Sales

13. Everyone wants to buy in the Inland Empire.
Price Per Sf I.E vs National IE is trending higher than the national average but the Volume is moving at a slower pace than last year.
Everyone wants to buy in the Inland Empire.

14. Cap rates have been steady between 5-6%

15. Median months to sale trending around 6-9 months
Average Time on Market

16. SUMMARY Job growth has returned to the Inland Empire.
Ended Q % Vacancy
Southern California's Inland Empire assumed its customary position as the top U.S. construction market for industrial space with 10 million square feet added in the second quarter, 1/3 of which was preleased
New industrial under construction in Lake Elsinore and proposed new product in Murrieta.