The Inland Empire sees an increase in vacancy due to new construction deliveries
In the fourth quarter, absorption totaled 3.7 million square feet (msf) due to large occupier move-ins. The large occupier move-ins included Shein occupying 1.8 msf in Cherry Valley, United Legwear and Apparel Co. occupying 1.7 msf in Beaumont and Maersk occupying 1.2 msf in Hesperia. Despite the positive absorption, Inland Empire market vacancy increased 140 basis points (bps) in the fourth quarter to 6.5%. This is also up 430 bps from the total vacancy rate of 2.2% recorded one year ago. The increase is due to a large amount of available sublease space being added to the market as well as vacant construction deliveries. Overall construction deliveries saw a historical high, recording 12.2 msf, with 7.2 msf of this space located in the Inland Empire East submarket