Riverside-San Bernardino Industrial Market Report

Recent absorption provides some optimism. After reaching an 11-year high in 2023, vacancy in Riverside-San Bernardino increased another 150 basis points during the first half of 2024. Despite this elevation, positive net absorption was recorded over the first six months of this year, contrasting the same period in 2023. This suggests the rise in vacancy was largely the result of another wave of speculative supply additions, as 13.6 million square feet was added to inventory. A similar supply-demand dynamic will be apparent in the second half. Positive net absorption will be recorded, yet vacancy will rise as nearly 12 million square feet is added to stock — more than half of which was available for lease as of July. This will rank the Inland Empire among the nation’s most vacant major markets.