Riverside-San Bernardino Industrial Market Report

Region well-positioned to absorb significant stock injection. The Inland Empire ranks third among major U.S. metros by rate of inventory expansion this year, a feat emphasized by the market’s size — entering 2023 as the fifth largest by total supply nationally. Though dramatic, this infusion of space appears warranted. At the close of last year, the metro had reported six consecutive quarters of sub-2 percent vacancy, far tighter than the average of 6.1 percent recorded during the prior decade. Developers are catering to users that require significant floor plans, with the average project slated for delivery exceeding 250,000 square feet. A bevy of move-ins exceeding 1 million square feet signals robust demand for larger warehouses. While this will restrain availability on the metro level, older properties in zones undergoing rapid supply transformation may face an elevated level of competition on the leasing side in 2023. The Airport Area is slated to receive 12 million square feet, or 40 percent of this year’s scheduled deliveries.