Shallow‑bay space stays tight
CBRE data highlights that shallow‑bay industrial remains in short supply nationwide because demand from small and mid‑sized occupiers is outpacing new construction — a squeeze that matters for LA‑basin tenants needing quick, lower‑clearance footprints. That scarcity supports premiums for well‑located, small‑bay product in Inland Empire hubs. (x.com)
By early 2024 shallow‑bay vacancy measured 2.5 percentage points below the overall industrial vacancy rate, a gap CBRE traces back to 2017 as shallow‑bay demand outpaced targeted construction. (cbre.com) Nearly half of U.S. shallow‑bay inventory was built before 1980, more than 80% pre‑2000, and properties built since 2010 account for only about 5% of the stock, leaving few modern, lower‑clearance footprints available. (cbre.com) In the Inland Empire, CBRE recorded a 4.7% vacancy in IE West in Q1 2025, with taking rents at $1.18 NNN per sq. ft. per month and 2.4 million sq. ft. of positive absorption that quarter. (cbre.com) CBRE also showed the IE Core had just 9.5 million sq. ft. under construction in Q1 2025, with only 549,000 sq. ft. breaking ground that quarter and 23.2% of the pipeline preleased, tightening near‑term options for mid‑size users. (cbre.com) Market reports from Colliers confirm heavy leasing velocity—leasing activity topped 14 million sq. ft. in Q1 2025—and show geography‑split conditions: West vacancy ~4.4% versus East ~8.5% as available supply and asking rents diverge across submarkets. (colliers.com) Local brokerage research flags rent expectations and premiums: Kidder Mathews projects large‑bay rents to hover near $1.00–$1.10 PSF NNN while noting “stickier premiums” in small‑bay parks that match lower‑clearance, infill demand. (kidder.com) Institutional capital is shifting toward shallow‑bay portfolios as vacancy for properties under 150,000 sq. ft. is materially lower than large‑format stock, and some research shows small‑bay rents have risen more than 40% since 2020—metrics that underpin investor appetite and the premium environment. (corebridgefinancial.com)
