The San Gabriel Valley's industrial real estate market ended 2006 on a high note with vacancies in the ultra-low 1 percent range, proving the continuing strong need of port-dependent businesses for warehouse and distribution space.
Activity was down overall due to the extremely tight market and its lack of product, forcing more businesses to look to the Inland Empire for larger amounts of available space, as they have been doing for several years.
In an example of the trend, Lamps Plus is leaving its City of Industry distribution center and moving 50 miles east to Redlands, where the retailer is expanding into a new, 730,000-square-foot property it purchased for $54 million.
About the only relief in sight remains Majestic Realty Co.'s Grand Crossing, a 400-acre industrial center in Industry that is under construction and will total 6.45 million square feet.
"New space is pretty much getting taken down before it gets completed," said Kent Stalwick, senior vice president, CB Richard Ellis Group Inc.
The region's office market ended the October-December period with a 2 point decrease in vacancies versus the year before, along with solid gains in rental rates. Class A asking rents jumping 15.5 percent to $2.54 a square foot.
Office space remained in high demand by international trade tenants especially in the heavily Asian communities of Alhambra and Monterey Park. That trend will most likely continue given very little new product on the horizon and the growth of area businesses
Lincoln Property Co. purchased a 158,000-square-foot industrial park in the City of Industry for about $21 million. The seller, a joint venture consisting of Master Development Corp. and GE Capital Real Estate, had purchased Fortune Business Park for $14.8 million in August 2005. The complex is 100 percent leased.
ARC International Corp. leased a 128,228-square-foot warehouse at 333 Turnbull Canyon Road in the City of Industry from First Industrial Realty Trust Inc. The value of the deal was not disclosed.
Gale Concourse Investment LLC acquired four office buildings at Concourse Business Park in the City of Industry for $11.7 million. LBA Realty Fund Concourse LLC sold the properties, which totaled 66,850 square feet.
At Majestic Realty's Crossroads Business Park, law firm Alvarez-Glasman & Colvin inked a 40-month lease for 7,000 square feet at the Atrium, a 220,000-square-foot office building in the City of Industry development. Also at Crossroads, Comerica Bank signed a 10-year lease renewal of 11,646 square feet, while Kaiser Foundation Hospitals entered a long-term lease for 9,900 square feet.
Hong Kong Supermarkets bought a 90,000-square-foot industrial building at 19317 Arenth Ave. in the City of Industry from Golden State Foods for $11 million. The supermarket chain plans to use the building as a food storage and distribution center and will consolidate its operations in Bell and Commerce into the new facility.
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