Where Buildings Are Business
From Xceligent report: See full article HERE
Market Overview
With a slight uptick in vacancy totaling 1.5% for warehouse distribution, landlords continue to reap the benefit. However, while sale prices are still high, Sales Volume has had a significant decrease over last year’s 3Q. Are prices going to drop? Demand continues to remain high, however pricing may have outpaced consumers.
See Xceligent report HERE
From Burbankca.gov – See Below
The proposed “Avion” project would construct a business park on approximately 60 acres of vacant land adjacent to the Burbank Bob Hope Airport consisting of the following components:
The project site is located at 3001 N. Hollywood Way, and is surrounded by industrial/storage uses (to the north and east), the Burbank Bob Hope Airport (to the west and south), and vacant parcels. North Hollywood Way abuts the easterly boundary of the project site, and North San Fernando Road is to the north, and Winona Avenue is to the south. The current zoning designations are “General Industrial (M-2)” and “Airport (AP)” and are proposed to change to “Planned Development (PD)” zoning. The project site has two General Plan land use designations, “Golden State Commercial/Industrial” and “Airport” and the entire project site is proposed to be Golden State Commercial/Industrial.
SEE FULL PAGE INFORMATION: HERE
The Los Angeles county industrial market remains the tightest in the country – Xceligent Research. Despite seeing a continual feeding frenzy for industrial property, the market inventory has increased — by 0.1%. With the only new product coming online in Valencia and Simi Valley, San Fernando Valley industrial property values continues to grow by leaps and bounds.
The newest trend in the warehouse world is “Creative Rehab” which turns the dated heavy industrial brick construction into warehouse/office conversions. These properties are complete with polished concrete floors, modern lighting, full A/C, and a kitchen that would make your home jealous. It also comes with a hefty price tag of nearly $1.40 NNN per square foot for over 10,000 sq.ft. of space. In comparison the competitive market rate is between $1.15-$1.20 NNN per square foot.
Land within the Valley will continue to disappear as Overton Moore Properties’ newest project will remove land from Burbank Airport adjacent parking lots. Effectively displacing many entertainment studio vehicles and other related companies. Sending land hungry companies into Sun Valley, Sylmar, and San Fernando.
Bottom line – my opinion is lease rates will increase and sale price to follow suit.
To see Xceligent full report click HERE.
Los Angeles Northwest region maintains continued low vacancy rates with only .1% increase in available space for warehouse and distribution totaling 1.1%. Direct Weighted Average Asking Rates (NNN) increased by $.01 to $.75 for warehouse and distribution but remained the same for flex property at $1.09. Unemployment also dropped for California.
In my opinion lease prices will continue at current market however sales prices will increase as users contemplate equity involvement in properties.
To see full report from Xcelligent click HERE.
Los Angeles Northwest region continued fierce competition through the fourth quarter with a .1% drop in vacancy rates totaling 1% now available. Weighted Average Asking Rent (NNN) increased $.01 per square foot from 3Q bringing averages to $.81 (NNN). Current construction by submarket showed LA Northwest in second place behind LA East. LA Northwest reported 1,104,333 sq.ft. while least-under-construction market LA Central showed 626,818 sq.ft. Lastly, LA northwest posted 100,029 square feet of Total Quarterly Net Absorption.
In my opinion lease rates and square foot prices will stay the same or increase as seen in Weighted Average Asking Rent (NNN) increase. No noticeable movement from increased financing rates as of yet. Additionally, with with such little inventory the pricing and values are highly compressed – Sellers market.
To see full report from Xcelligent click here or on photo. ***
Do you need more information or help regarding your commercial real estate? Call today and I’ll be happy to discuss your needs. I’ll even send you a free survey of available properties to help you value your property.
*** Data from sources deemed reliable however information not confirmed or warranted for accuracy. Prospective buyers/sellors/lessors/lessees must do their own research.
While working with small businesses for purchasing property, I am often asked what kind of financing is available. I respond, “Conventional of course, and this ‘thing’ called SBA.” For those of us that aren’t experienced in the difference, I’ve taken a clip from Wells Fargo SBA Lending webpage (click here for direct website or on photo) to better define this “thing” or rather, lets better refer to it as a Program. Small Business Administration (SBA) provides an opportunity for a small business to purchase property with lower down payments and long repayment terms. Below is the difference between the SBA 7(a) and SBA 504 programs that are available.
I’ve found that some companies have experienced an opportunity to purchase a property where they previously could not because of their use of this program.
So there you have it. A quick insight into the SBA loan programs.
Do you need more information or help regarding your commercial real estate? Call today and I’ll be happy to discuss your needs. I’ll even send you a free survey of available properties to help you value your property.
Ryan McKenzie
BRE# 01787433
818-933-7113
Ryan@go2delphi.com
DISCLAIMER: I am not a lawyer, accountant, or an adviser. Nor am I in any way suggesting or implying you or anyone else use Wells Fargo or any other provider for that matter. All information herein is for information and educational purposes only. You must locate and retain your own source of professional information. I do not warranty or guarantee any information to be accurate.
Ryan McKenzie Industrial CRE 