Industrial Space is comprised of two distinct markets, manufacturing and warehousing. Although each geography is a mixture of both, San Francisco, Silicon Valley and Orange County can be broadly characterized as being more heavily manufacturing, the East Bay, and Los Angeles a mix of the two, and the Inland Empire by warehousing. The basic underlying economic forces in industrial See more +

Industrial Space is comprised of two distinct markets, manufacturing and warehousing. Although each geography is a mixture of both, San Francisco, Silicon Valley and Orange County can be broadly characterized as being more heavily manufacturing, the East Bay, and Los Angeles a mix of the two, and the Inland Empire by warehousing. The basic underlying economic forces in industrial markets are a growth in California manufacturing, a growth in exports and slow-to-no-growth in consumer goods imports through the California's ports. In all of the markets surveyed, developer sentiment, though still very positive, is weaker than six months ago. This is consistent with the nervousness over Europe and the potential impact that could have on manufacturing exports. As well, the uncertainty with respect to the fiscal stance of the U.S. in 2013 has led to importers being much more cautions. Imports through California seaports have grown at only a moderate rate in 2012 reflecting the slow growth in consumption of consumer goods from the manufacturing centers of Asia. Even though sentiment is not as high as six months ago, it has been sufficiently optimistic for long enough to generate new building activity. In most California markets, occupancy rates are rising. This is particularly true in Los Angeles and Orange County where occupancy rates have hit 96%. As a consequence 45% of the Southern California panel and 28% of the Bay Area panel are expecting to begin a new industrial space development in the next 12 months. See less -