U.S. Industrial
MarketView
Q2 2012
AVAILABILITY RATE
13.2%
CBRE Global Research and Consulting
LEASE RATE
$5.46
NET ABSORPTION
26.4 MSF
CONSTRUCTION COMPLETIONS
5.2 MSF
THE FIGHT FOR CLASS A SPACE ACCELERATES
Executive Summary
• Despite a lackluster
macroeconomic environment,
industrial leasing velocity has
improved as users try to lock-in
currently favorable rent and lease
terms.
• Industrial demand will soften over
the next several quarters, in line
with slowing U.S. and global
growth, a faltering manufacturing
sector and shrinking international
trade.
• User demand for Class A space will
continue to drive down availability
rates, leading to upward pressure
on lease rates. Construction activity
is back, including both build-to-suit
and speculative projects across
some of the nation’s largest
industrial markets.
• Low interest rates and the limited
supply of Class A industrial product
for sale will continue to drive cap
rates down in the near term.
• Industrial real estate performance
continues to recover as signaled by
the NCREIF Property Index.
Industrial real estate delivered an
annualized total return of 13.4%
during Q1 2012, in line with the
overall index.
INDUSTRIAL LEASING ACTIVITY:
More active than underlying
economic trends would suggest
Despite a number of major global
economic headwinds and a U.S. economy
that is fast losing momentum, industrial
leasing remained surprisingly active across
most markets during the past quarter. The
U.S. industrial market continued to show
signs of recovery, with the national
industrial availability rate dropping by 20
basis points (bps) to 13.2% in the second
quarter of 2012. Occupiers have begun
to move off the sidelines, seeking longer
term leases to take advantage of lower
competitive rents, which are expected to
rise. “Extend and blend” user transactions
continue, but landlords are getting pricing
power back as industrial market conditions
improve. A number of industrial users are
also considering the ownership option
given record-low interest rates.
Tenants are upgrading, relocating from
Class B to Class A space, but options are
getting tighter. Manufacturing space
requirements were also on the rise,
particularly in the southeastern and
northeastern U.S. markets, due in part to
the U.S. “manufacturing renaissance.”
The prospect for industrial demand over
the next few months will likely be flat,
however, given weakening headline
economic indicators. U.S. economic data
has been disappointing, leading to further
downward revisions to growth. The overall
economy, consumer spending,
international trade and the broader
manufacturing sector are among the key
drivers of industrial demand, with all
pointing to a soft patch through at least
the next quarter.
Warehouse demand was the main driver
for spaces larger than100,000 sq. ft.
© 2012, CBRE, Inc.
U.S. Industrial | MarketView
4.0
Figure 2: U.S. International Trade Activity
Total Trade ($ Billions)
Annual Percent Change (%)
Annual Percent Change (%)
$6,000
3.5
5%
$5,000
Forecast
3.0
6%
Forecast
4%
$4,000
2.5
2.0
$3,000
1.5
$2,000
1.0
0.5
1%
0%
$0
1%
2013Q4
2013Q3
2013Q2
2013Q1
2012Q4
2012Q3
2012Q2
2012Q1
2011Q4
2011Q3
2011Q2
2011Q1
2010Q4
2010Q3
2010Q2
2010Q1
2%
$1,000
0.0
Consumer Spending
3%
2010Q1
2010Q2
2010Q3
2010Q4
2011Q1
2011Q2
2011Q3
2011Q4
2012Q1
2012Q2
2012Q3
2012Q4
2013Q1
2013Q2
2013Q3
2013Q4
Q2 2012
Figure 1: U.S. Economy Downshifts
Total Trade (L)
Real GDP
Source: IHS Global Insight, Interim Forecast, July 2012
Growth % (R)
Source: IHS Global Insight, Interim Forecast, July 2012
The U.S. economy and industrial sector have begun to feel the brunt of the slowdown in global growth, which originated in
Europe but has now spread to Latin America and Asia. U.S. trade, which is the sum of imports and exports, slowed during the
second quarter and is expected to actually decline in the third quarter.
Figure 3: ISM Surprised to the Downside (ISM Purchasing Managers’ Index [Diffusion index, SA])
70
60
50
40
30
20
M5 2012
M3 2012
M1 2012
M11 2011
M9 2011
M7 2011
M5 2011
M3 2011
M1 2011
M11 2010
M9 2010
M7 2010
M5 2010
M3 2010
M1 2010
M11 2009
M9 2009
M7 2009
M5 2009
2
M3 2009
0
M1 2009
10
Source: Institute for Supply Management
© 2012, CBRE, Inc.
facilitate the transportation of oil and
gas for exports.
The expansion of e-retailers continues to
fuel the need for warehouse and
distribution space. Amazon, the leader in
e-retailing, continues to push for larger
facilities close to large metropolitan
areas to decrease delivery times. As
traditional retailers grow their e-retailer
strategies, it will likely increase demand
for warehouse space and shrink the
need for traditional bricks-and-mortar
retail, which is typically 10 to 20 times
the cost of a warehouse facility.
U.S. Industrial | MarketView
Domestic demand for local goods has
also decreased over the past few months
due to the continued struggles in the
housing sector and weaker-thananticipated job growth. A silver lining for
consumer spending and the U.S.
economy, however, has been the decline
in commodity and energy prices globally.
In the U.S., it is estimated that a onecent decline in retail gasoline prices
equates to roughly $1 billion in
economy-wide tax cuts. The lower price
of oil will provide a floor under
consumer spending and likely cause
domestic consumption to increase
moderately as consumers now have a
higher level of disposable income. The
challenge remains with both consumer
and business confidence levels; this has
resulted in cautious spending and
investment from both sides.
announcements of new manufacturing
plants, especially in the transportation
sector, in the southern U.S. markets.
These companies have been drawn by
competitive labor costs, the availability
of real estate at competitive rates, and
the availability of a skilled and highly
productive workforce. Part of the
re-shoring of manufacturing to the U.S.
has been driven by the needs of the
consumers, the timely delivery of product
to the consumer and the demand for
custom products such as a specific color
or design. Although with the recent
increase in demand, manufacturers will
increase the utilization rates of existing
facilities before seeking additional
space. Recent announcements include: Q2 2012
The ISM manufacturing index, a great
demand-side proxy for industrial real
estate, came in well below expectations.
The June ISM manufacturing index
slumped to 49.7, the first sub-50
reading since July 2009. The forwardlooking details of the survey were also
weak, with both new orders and export
orders coming in below 50 as global
headwinds appear to be exerting greater
pressure on the U.S. industrial sector.
The dip in the ISM suggests that the
downshift in the manufacturing sector
may be accelerating. The manufacturing
data had been weak, but until now the
ISM index had looked better than either
manufacturing output or durable goods
orders. The ISM survey’s details suggest
that the factory slowdown will continue
through at least the next few months.
• Airbus’ new assembly plant—to be
built in Mobile, Alabama—is
scheduled to be completed in 2015, a
$600 million investment.
• Ford is adding 1,800 jobs in Louisville,
Kentucky, adding a third shift in the fall
of 2012.
• Magna Seating of America, Inc. is
building a 140,000-sq.-ft. plant in
Shepherdsville, Kentucky, adding 450
new jobs in 2012.
• Asahi Forge, a Japanese automotive
supplier, is adding a second
manufacturing plant in Richmond,
Kentucky, in 2012.
• Nissan will increase production for the
new Sentra, adding 1,000 new jobs in
Mississippi.
• GM to add 800 jobs, adding a third
Longer-term, however, we expect the
drivers of industrial demand to shift to a
more positive trajectory given secular
changes in the global economy. U.S.
manufacturing companies continue to
benefit from the relatively lower value of
the U.S.dollar. Accelerating wage rates
in Asia and higher transportation costs
are also fostering a “manufacturing
renaissance” in the U.S. Over the past
few months there have been a few
© 2012, CBRE, Inc.
shift to its truck plant in Texas in 2012.
The domestic energy sector is having a
marginal influence on the industrial
sector as well, but this will likely change
with the further development in shale, as
existing plants are adapted to
accommodate the processing and
transport of the new materials. New
plants are also being built in ports to
3
Completions and Absorption (MSF)
Availability Rate (%)
16%
Completions (L)
Absorption (L)
2012Q2
2012Q1
7%
2011Q4
-100
2011Q3
8%
2011Q2
-80
2011Q1
9%
2010Q4
-60
2010Q3
10%
2010Q2
-40
2010Q1
11%
2009Q4
-20
2009Q3
12%
2009Q2
0
2009Q1
13%
2008Q4
20
2008Q3
14%
2008Q2
40
2008Q1
15%
2007Q4
60
2007Q2
U.S. Industrial | MarketView
80
2007Q3
Q2 2012
Figure 4: U.S. Industrial Supply and Demand
Availability Rate (R)
Source: CBRE Econometric Advisors
USERS UPGRADING SPACE
4
Despite the lackluster economic
environment, industrial space demand
has been relatively stable. Industrial
users continue to favor higher quality,
newer space that can increase
productivity and lower the real estate
cost. Companies are reviewing
everything from their current locations,
technology, and plant layout of
equipment to increase production
efficiencies. In some cases occupiers are
moving into newer facilities and reducing
space, compared to their prior premises,
due to the increase in storage capacity
with higher stacking capability and a
more efficient plant layout. This is driving
the demand by tenants to trade up to
newer, more modern Class A industrial
facilities. These buildings typically have
higher ceilings, super-flat floors and
have been built in the last ten years.
Even with the national industrial
availability rate at 13.2%, the scarcity of
available space in such buildings means
that Class A industrial availabilities
continue to shrink, in some cases at the
expense of older industrial buildings.
© 2012, CBRE, Inc.
Q2 2012
U.S. Industrial | MarketView
HERE COMES THE SUPPLY
The lack of available product required
by users is placing upward pressure on
lease rates for the best space; however,
lease rates for average product remain
flat. In primary markets, rents for newer
facilities are approaching replacement
levels and spurring new development.
New construction continues to increase
across key markets due to the drop in
availability rates in 2012 and the lack of
newer, Class A industrial space. New
construction for 2012 has totaled nearly
11 million sq. ft., and is on track to
exceed the industrial new supply
completed in 2011. Most of this new
space consists of Class A design-build
projects, although an increase in
speculative construction projects across
the country is emerging. Pockets of
speculative construction activity are
occurring in Northern Virginia,
Indianapolis, the Inland Empire, Orange
County, Salt Lake City and Atlanta. Many
of these markets have single-digit
industrial availability rates, with available
Class A industrial space virtually nonexistent. Due to the short supply of new
product, many of these projects are
often pre-leased. In Atlanta, despite
many available warehouse options, a
new 630,000-sq.-ft. speculative project
is under construction, underscoring the
demand for state-of-the-art large
warehouse and distribution space.
THE PANAMA CANAL FACTOR
The Panama Canal has also impacted
the U.S. industrial market with respect to
competition between East Coast versus
West Coast ports. The race continues in
the eastern U.S. gateway markets such
as New York, New Jersey, Norfolk, and
Miami to invest capital in preparing for
the completion of the Panama Canal
expansion. Most of the investment
continues to be for dredging projects,
which will allow the ports to
accommodate larger ships as well as the
need to increase the clearance height of
bridges. The only port that can currently
© 2012, CBRE, Inc.
accommodate the post-panamax ship is
Norfolk. The Port Authority of New York
and New Jersey has committed $1
billion to raise the Bayonne Bridge,
which connects Bayonne, New Jersey,
with Staten Island, New York, by 64 feet
to allow larger ships to pass. Port
spending will increase as we near the
completion of the Panama Canal
expansion in 2014.
The investment benefits for eastern ports
will be minimal in the short term, as the
transportation infrastructure for goods
inland remains in western ports. In the
near term, it remains more cost effective
and quicker for shippers to offload in
western ports and transport goods via
rail to major markets such as Chicago.
Eastern ports will likely benefit from
increased container traffic from ships
using the Suez Canal and expanding
markets such as Brazil to the south.
5
Q2 2012
INDUSTRIAL CAPITAL MARKETS
U.S. Industrial | MarketView
Domestic and cross-border investors
continue to closely monitor industrial
sector fundamentals given favorable
leasing velocity and the lack of Class A
options for newer space. Stronger rental
recovery is being used in underwriting
industrial acquisitions. Rising sales
volume reflects the surge in investor
interest. The industrial capital market
trends signal improving transaction
volume, according to Real Capital
Analytics. Over the first five months of
2012, industrial transactions totaled
$10.3 billion, a 13% increase over
year-ago levels. Interest in industrial
property has resurfaced, as investors
increasingly eye portfolio transactions.
Institutional investors, however, continue
to focus on Class A and/or value-add
properties in primary markets. Recordlow interest rates, combined with greater
institutional capital than available supply
of properties for sale, continue to drive
down cap rates, especially for better
assets.
Figure 5: Institutional Capital Targeting Industrial Assets
Industrial Transaction Volume ($ Billions)
Cap Rates (%)
$12
8.8%
8.6%
$10
8.4%
$8
8.2%
8.0%
$6
7.8%
$4
7.6%
7.4%
$2
7.2%
7.0%
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
$0
2010
2011
Industrial Transactions (L)
2012
Average Cap Rates (R)
Source: Real Capital Analytics
6
Industrial real estate performance
continues to recover as signaled by the
NCREIF Property Index. Industrial real
estate delivered an annualized total
return of 13.4% during Q1 2012, in line
with the overall index. This was the
second highest return, trailing only the
multi-housing sector. Much of the return
has been due to a surge in appreciation
returns that have been driven by cap rate
compression earlier this year. The
western region of the U.S. also
dominates the market value of industrial
properties in the NPI and as such, the
solid performance of industrial markets
in the west continue to drive overall
industrial performance.
© 2012, CBRE, Inc.
Figure 6: 25 Largest Industrial Markets - Q2 2012
MINNEAPOLIS/
ST. PAUL
326,839 SF
10.2%
$4.70
SAN JOSE
243,759 SF
13.5%
$11.42
LOS
ANGELES
993,073 SF
6.8%
$6.52
From a regional perspective, the largest
increases in absorption occurred in
Chicago, the Inland Empire and New
Jersey, respectively, and were mostly
driven by the demand in Class A
industrial warehouse and distribution
space.
SAN DIEGO
200,759 SF
15.0%
$10.32
DENVER
223,929 SF
7.8%
$6.21
INLAND
EMPIRE
403,354 SF
11.8%
$4.08
ORANGE
COUNTY
252,457 SF
7.4%
$7.56
7
KANSAS
CITY
233,654 SF
12.3%
$4.53
ST. LOUIS
222,407 SF
14.9%
$4.34
PHOENIX
275,326 SF
15.0%
$6.84
DALLAS/
FT. WORTH
721,121 SF
13.4%
$3.70
CHICAGO
1,188,170 SF
9.7%
$3.99
CINCINNATI
267,221 SF
9.5%
$3.79
INDIANAPOLIS
238,848 SF
9.1%
$4.28
ATLANTA
551,590 SF
18.8%
$3.29
NEW JERSEY
NORTHERN
409,442 SF
10.1%
$6.11 NEW JERSEY
CENTRAL
395,459 SF
10.4%
$4.37
PHILADELPHIA
401,433 SF
12.5%
$3.86
BALTIMORE
153,169 SF
15.5%
$4.79
HOUSTON
448,767 SF
9.2%
$3.91
NATIONAL QUICK STATS
Current
13.2%
$5.46
26.4 MSF
5.2 MSF
MILWAUKEE
226,563 SF
11.8%
$3.76
DETROIT
511,766 SF
11.9%
$4.47
CLEVELAND
290,783 SF
8.3%
$4.59
COLUMBUS
208,190 SF
12.6%
$3.04
QoQ
YoY
i
i
h
h
i
i
i
i
U.S. Industrial | MarketView
U.S. Industrial | MarketView
SEATTLE
249,079 SF
10.3%
$6.49
The national availability rate masks
regional performance. According to
second quarter figures, west coast
markets such as Los Angeles (6.8%) and
Orange County (7.4%) are reporting
lower industrial availability rates than
any other market. By contrast, east coast
markets such as Stamford (25.9%),
Boston (20.9%) and Atlanta (18.8%)
report among the highest industrial
availability rates in the nation. Industrial
markets in older east coast cities suffer
from a higher degree of older and
obsolete product.
Q2 2012
Availability Rate
Lease Rate
Net Absorption*
Construction Completions
Q2 2012
Q2 2012
REGIONAL
OVERVIEW:
SUPER-REGIONAL
DISTRIBUTION
CENTERS
OUTPERFORM
MARKET
STOCK (SF x 1000)
AVAILABILITY RATE
NNN ASKING RENT
200,000,000 SF
MIAMI
211,710 SF
9.3%
$4.68
1,000,000,000 SF
Source: CBRE Research
Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we
have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy and
completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be
reproduced without prior written permission of the CBRE Global Chief Economist.
*The arrows indicate a trend and do not represent a positive or negative value for the underlying statistic
(e.g., net absorption could be negative, but still represent a positive trend over the time period).
© 2012, CBRE, Inc.
© 2012, CBRE, Inc.
8
Q2 2012
NEW JERSEY
U.S. Industrial | MarketView
Industrial availability in Central New
Jersey remained flat at 10.4%, whereas
availability decreased 40 bps to 10.1%
in Northern New Jersey during the same
period. The average asking lease rate
for industrial property in New Jersey
increased during the second quarter for
the first time in the past four years. The
state’s asking lease rate is still $1.07
below its peak rate set in Q2 2008,
although that gap is expected to tighten,
especially for Class A industrial space.
Central New Jersey continues to attract
the majority of demand for new space,
mostly consisting of third party logistics
as well as consumer products
companies. Activity at the ports of New
York and New Jersey remains strong,
adding to the demand for warehouse
and distribution space. In the northern
portion of New Jersey, the Meadowlands
submarket continues to attract significant
tenant demand with its high
concentration of industrial space in close
proximity to New York City.
Three new construction projects
amounting to 1.17 million sq. ft. broke
ground during Q2 2012. More than half
of these new starts are being built on
speculative development and the recent
increase in new construction is pushing
land prices higher.
As compared to just a few quarters ago,
industrial construction activity in New
Jersey is picking up, due to increasing
demand and limited number of options
for large, modern industrial users. Four
industrial buildings were completed in
Q2 2012: three build-to-suit projects
totaling 652,155 sq. ft. and one
101,600-sq.-ft. speculative project.
GREATER LOS ANGELES
The Greater Los Angeles industrial
availability rate fell to 6.8%, a 10 bps
decrease from the previous quarter; this
represents one of the lowest rates in the
U.S. The increased volume of port
activity has created an even greater
need for distribution space for larger
and more modern distribution facilities
of over 100,000 sq. ft. In addition, there
has been an increase in demand for
industrial space under 50,000 sq. ft.,
mainly coming from small start-up
companies.
The Inland Empire is dominating market
activity in Southern California, as large
Class A distribution centers are in high
demand by logistics companies and
retailers looking to expand distribution
capabilities. Activity levels are very high
in the 100,000-sq.-ft. category. The bulk
of construction activity in Southern
California is also occurring in the Inland
Empire, with 7.3 million sq. ft. currently
under construction (the highest figure
since pre-recession), of which 38%—or
2.8 million sq. ft.—is speculative
construction.
In Los Angeles County, Commerce,
South Bay and San Fernando have been
particularly strong, with demand from
both manufacturing companies and
wholesalers. The most active size range
is between 50,000 sq. ft. and 75,000
sq. ft.—in fact, approximately 63% of
Q2 2012 activity was between 10,000
sq. ft. and 100,000 sq. ft. Although
construction is fairly active in Los
Angeles County, with 1.8 million sq. ft.,
the market has not experienced the
same growth that the Inland Empire is
witnessing. However, during the next six
to 12 months, the lack of Class A
industrial space will likely spur an
increased volume of construction,
including speculative projects.
9
© 2012, CBRE, Inc.
Lease rates are starting to increase,
primarily due to a shrinking availability
of space. Most new construction has
consisted of build-to-suit activity. Two
speculative projects were recently
announced: approximately 661,000 sq.
ft. in South Dallas from ProLogis; and
529,000 sq. ft. in Northwest Dallas
from IDI.
CHICAGO
Chicago’s industrial market continues to
recover, with the availability rate
decreasing to 9.7%, a change of 40 bps
from the previous quarter. Three out of
the top 10 deals were paper-related
companies (Kimberly Clark at 716,318
sq. ft.; Domtar Paper with 453,364 sq.
ft.; and International Paper at 316,000
sq. ft.). Machinery, metal and durable
goods also had strong showings during
the second quarter. The Far SW
suburban market in Chicago (also
known as the I-55 corridor) dominated
leasing activity during Q2 2012, with
more than 1.7 million sq. ft. of activity.
This accounted for 24% of all leasing
activity that occurred in Q2 2012. This
submarket has newer big box product,
lower lease rates and easy access to
expressways, which will keep it in
tenants’ favor for the foreseeable future.
For new industrial supply, two projects
broke ground in the second quarter: a
239,000-sq.-ft. build-to-suit for FedEx,
and a 604,000-sq.-ft. speculative
project, both of which are in the Far SW
suburban submarket. In addition, there
are six projects currently under
construction totaling 1.9 million sq. ft.,
of which two are speculative projects
while the other four are build-to-suit.
The last time Chicago had this much
speculative construction was in 2008.
An increase in demand is causing rental
rates to increase marginally while
landlords are offering less tenant
incentives and moving rents up for Class
A industrial buildings.
ATLANTA
The industrial availability rate in Atlanta
increased to 18.8%, a difference of 20
bps from the previous quarter. Demand
for warehouse and distribution space
from third-party logistics firms has
increased. Bulk warehouse Class A
space in the core submarkets of
Northeast and South Atlanta continues
to be the most sought-after. The demand
© 2012, CBRE, Inc.
for modern industrial buildings has
caused older product in the Fulton
industrial market to lag due to the age
and obsolescence of older industrial
buildings. New construction has been
limited until now, with mostly build-tosuit activity taking place in
south Atlanta.
Figure 7:
Industrial Market Snapshot
Lowest Availability Rates (%)
LOS ANGELES METRO
ORANGE COUNTY
WESTCHESTER COUNTY
DENVER
CLEVELAND
6.8
7.4
7.7
7.8
8.3
Highest Availability Rates (%)
STAMFORD
BOSTON
AUSTIN
ATLANTA
WALNUT CREEK
25.9
20.9
19.4
18.8
18.5
U.S. Industrial | MarketView
The industrial availability rate remained
flat in Dallas at 13.4% for Q2 2012.
Most of the recent demand has been
from retailers for warehouse and
distribution buildings. Home Depot
recently occupied a large block of
space, and Kohl’s will be opening a
facility later this year. The most active
submarket, Great Southwest/Arlington,
posted the largest amount of absorption
in the first half of 2012, at 2.8 million
sq. ft. total.
Q2 2012
DALLAS
Source: CBRE Research
Figure 8: Largest Quarterly
Decreases and Increases*
Decreases in Availability
COLUMBUS
DETROIT
ORLANDO
HARTFORD
BALTIMORE & STAMFORD
-2.9
-1.9
-1.8
-1.0
-0.9
Increases in Availability
WESTCHESTER COUNTY
WALNUT CREEK
SAN ANTONIO
JACKSONVILLE
LONG ISLAND
1.7
1.3
1.2
1.0
0.8
*Percentage point change
Source: CBRE Research
10
Figure 9: Industrial Availability - Q2 2012
Q2 2012
U.S. Industrial | MarketView
11
Market Region
BALTIMORE
BOSTON
HARTFORD
LONG ISLAND
MARYLAND SUBURBAN*
NEW JERSEY CENTRAL
NEW JERSEY NORTHERN
NORFOLK
PHILADELPHIA
STAMFORD
VIRGINIA NORTHERN*
WESTCHESTER COUNTY
East
CHICAGO
CINCINNATI
CLEVELAND
COLUMBUS
DETROIT
INDIANAPOLIS
KANSAS CITY
MILWAUKEE
MINNEAPOLIS/ST. PAUL
ST. LOUIS
Midwest
ATLANTA
AUSTIN
DALLAS/FT. WORTH
FT. LAUDERDALE
HOUSTON
JACKSONVILLE
MIAMI
NASHVILLE
ORLANDO
PALM BEACH
SAN ANTONIO
TAMPA
South
ALBUQUERQUE
DENVER
INLAND EMPIRE
LAS VEGAS
LOS ANGELES METRO
OAKLAND
ORANGE COUNTY
PHOENIX
PORTLAND
SACRAMENTO
SALT LAKE CITY
SAN DIEGO
SAN FRANCISCO PENINSULA
SAN JOSE
SEATTLE
TUCSON
WALNUT CREEK
West
UNITED STATES
Size Rank
29
30
41
44
39
10
7
38
9
50
42
51
NNN Asking Rate ($)
Q2 12
4.79
6.45
4.76
8.39
8.06
4.37
6.11
4.53
3.86
7.00
10.22
10.74
1
14
12
24
5
18
19
20
11
22
3.99
3.79
4.59
3.04
4.47
4.28
4.53
3.76
4.70
4.34
4
43
3
37
6
36
23
28
34
45
48
32
3.29
6.84
3.70
6.63
3.91
3.98
4.68
3.78
5.00
6.44
4.88
5.02
46
21
8
35
2
31
15
13
26
27
33
25
40
17
16
47
49
6.50
6.21
4.08
5.74
6.52
5.28
7.56
6.84
4.44
5.16
4.80
10.32
18.12
11.42
6.49
6.65
7.20
© 2012, CBRE, Inc.
Q2 12
15.5
20.9
14.9
14.3
15.6
10.4
10.1
12.6
12.5
25.9
15.3
7.7
12.9
9.7
9.5
8.3
12.6
11.9
9.1
12.3
11.8
10.2
14.9
10.7
18.8
19.4
13.4
11.6
9.2
16.5
9.3
15.6
17.5
12.8
16.7
13.4
14.0
12.0
7.8
11.8
13.5
6.8
9.2
7.4
15.0
9.7
16.8
8.7
15.0
9.5
13.5
10.3
15.5
18.5
10.4
13.2
Availability Rate (%)
Q1 12
16.4
21.3
15.9
13.5
16.2
10.4
10.5
12.7
12.7
26.8
14.7
6.0
13.2
10.1
10.1
8.5
15.5
13.8
9.3
12.3
11.1
10.9
15.1
11.3
18.6
19.1
13.4
11.1
9.3
15.5
9.2
15.3
19.3
13.3
15.5
13.5
13.9
11.7
8.4
12.5
13.2
6.9
9.4
7.8
15.4
9.6
16.7
9.4
15.4
9.9
13.7
10.7
15.5
17.2
10.6
13.4
Q2 11
17.8
23.1
17.2
15.0
16.8
12.1
10.0
11.4
12.7
21.1
15.9
4.5
13.7
10.5
10.2
9.9
16.1
15.1
10.9
12.3
12.1
11.5
15.0
12.0
19.2
22.0
14.7
13.4
10.3
14.7
10.5
15.1
19.5
13.7
17.8
13.3
14.9
11.4
9.2
12.2
11.4
7.4
10.3
8.5
16.2
10.5
16.0
9.3
16.2
9.3
15.2
11.8
12.7
17.5
11.1
14.0
* Maryland Suburban and Virginia Northern represent Washington, DC area.
U.S. national figures provided by CBRE Econometric Advisors (CBRE EA), all other figures compiled by CBRE Research
contacts
Q2 2012
For more information about this U.S. Industrial MarketView, please contact:
U.S. Industrial | MarketView
Edward J. Schreyer, SIOR
Executive Managing Director
Brokerage Services, Americas
CBRE
t: +1 214 863 3042
e: ed.schreyer@cbre.com
Asieh Mansour, Ph.D.
Head of Research, Americas and
Senior Managing Director
CBRE Global Research and Consulting
t: +1 415 772 0258
e: asieh.mansour@cbre.com
James Costello
Managing Director, Head of Americas
Investment, Consulting and Strategy,
CBRE Global Research and Consulting
t: +1 617 912 5326
e: jim.costello@cbre.com
Follow Asieh on Twitter: @AsiehMansourCRE
Raymond Wong
Managing Director, COO and
Industrial Specialist, Americas Research,
CBRE Global Research and Consulting
t: +1 416 815 2353
e: raymond.wong@cbre.com
Heather Edmonds
Director, Western U.S. Research Division,
CBRE Global Research and Consulting
t: +1 909 418 2090
e: heather.edmonds@cbre.com
Pamela Murphy
Senior Vice President, Eastern
and Central U.S. Research Divisions,
CBRE Global Research and Consulting
t: +1 212 984 8004
e: pamela.murphy@cbre.com
Andrea Walker
Director
Head of Americas Research Publications
and Data, CBRE Global Research and
Consulting
t: +1 919 376 8608
e: andrea.walker@cbre.com
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This report was prepared by the CBRE U.S. Research Team which forms part of CBRE Global Research and Consulting – a
network of preeminent researchers and consultants who collaborate to provide real estate market research, econometric
forecasting and consulting solutions to real estate investors and occupiers around the globe.
12
Disclaimer
Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we
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completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be
reproduced without prior written permission of the CBRE Global Chief Economist.
© 2012, CBRE, Inc.