Average market rents in Orange County are among the highest of all major markets in the United States and rent growth continues to be dynamic in light of a low vacancy environment. The average rent of $18.00/SF quoted is above Los Angeles on average and substantially higher than Inland Empire, the latter of which has a significant amount of newer inventory and a much deeper pipeline. Orange County’s proximity to Los Angeles County ports and major thoroughfares into Inland Empire amid a dense population has reinforced market stability. Strong local demand drivers have kept investors focused on Orange County, even with record-high pricing and a shrinking market cap rate in a high interest-rate environment. Developers are building logistics-oriented infill projects to accommodate pent-up demand. A diverse economy, geographic constraints, a strong biotech/medical device scene in South County, and proximity to the ports of Los Angeles and Long Beach in North County have all contributed to record low industrial vacancies in Orange County.
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