Vacancy levels reverse course and increase in the second quarter
After two straight quarters of declining vacancy, the Inland Empire’s rate fell by 20 basis points (bps) in the second quarter to 8.7%, marking a 40-bps decrease from the same period last year. Second quarter absorption totaled -621,773 square feet (sf), driven by occupier move-outs in the Inland Empire East submarket totaling -3.1 million square feet (msf). The Inland Empire West submarket posted the highest net absorption at 969,268 sf while the High Desert submarket closely followed recording 955,000 sf. Quarterly deliveries hit a low of only 431,600 sf, down 1.6 msf from the previous quarter. With construction activity projected to stay subdued in the near term and some occupiers opting to release space, vacancy rates are expected to remain relatively stable.