Quantcast
4S Ranch Allied Gardens Alpine Baja Balboa Park Bankers Hill Barrio Logan Bay Ho Bay Park Black Mountain Ranch Blossom Valley Bonita Bonsall Borrego Springs Boulevard Campo Cardiff-by-the-Sea Carlsbad Carmel Mountain Carmel Valley Chollas View Chula Vista City College City Heights Clairemont College Area Coronado CSU San Marcos Cuyamaca College Del Cerro Del Mar Descanso Downtown San Diego Eastlake East Village El Cajon Emerald Hills Encanto Encinitas Escondido Fallbrook Fletcher Hills Golden Hill Grant Hill Grantville Grossmont College Guatay Harbor Island Hillcrest Imperial Beach Imperial Valley Jacumba Jamacha-Lomita Jamul Julian Kearny Mesa Kensington La Jolla Lakeside La Mesa Lemon Grove Leucadia Liberty Station Lincoln Acres Lincoln Park Linda Vista Little Italy Logan Heights Mesa College Midway District MiraCosta College Miramar Miramar College Mira Mesa Mission Beach Mission Hills Mission Valley Mountain View Mount Hope Mount Laguna National City Nestor Normal Heights North Park Oak Park Ocean Beach Oceanside Old Town Otay Mesa Pacific Beach Pala Palomar College Palomar Mountain Paradise Hills Pauma Valley Pine Valley Point Loma Point Loma Nazarene Potrero Poway Rainbow Ramona Rancho Bernardo Rancho Penasquitos Rancho San Diego Rancho Santa Fe Rolando San Carlos San Marcos San Onofre Santa Ysabel Santee San Ysidro Scripps Ranch SDSU Serra Mesa Shelltown Shelter Island Sherman Heights Skyline Solana Beach Sorrento Valley Southcrest South Park Southwestern College Spring Valley Stockton Talmadge Temecula Tierrasanta Tijuana UCSD University City University Heights USD Valencia Park Valley Center Vista Warner Springs

Industrial vacancies lowest ever for San Diego

This can drive up prices, lengthen leases

Carturner, which makes devices used by dealers and people with difficult driveways, was given the boot from  Vista.
Carturner, which makes devices used by dealers and people with difficult driveways, was given the boot from Vista.

It appears that San Diegans go to craft brewers located in industrial parks, put on weight, then go to to a fitness centers in industrial parks to shed that excess blubber. These are two reasons that San Diego has the lowest industrial vacancy rate in recorded history — 4.2 percent, according to Colliers International, which keeps tabs on real estate statistics.

Alan Nevin on Xpera site: “It’s difficult to find industrial space, even down at the border."

“Plain old industrial buildings are fading away — being converted to other kinds of uses [including] craft brewing firms by the hundreds,” says Alan Nevin, research director at Xpera Group. “This is driving down vacancy rates and driving up lease rates. Old tacky industrial space that was 75 cents a square foot is now $2 a square foot,” often after rehabilitation. Brewers locate in industrial parks because parking clears out at 5 p.m when customers arrive to imbibe.

Brewers are filling industrial parks, and so are “gyms, personal training centers, fitness facilities,” says Ken Robak, executive vice president of Pacific Coast Commercial. “Not a significant supply has been created and demand is up.” In the last two years, lease rates have gone up 20 percent in the squeeze, he says.

Leases have also lengthened. Nick Mane of Pacific Coast Commercial says, “Most owners [of the properties] want a three- to five-year lease term. In my five years, I have never done anything less than one year.”

This is a problem for Bill Schwenker, founder and owner of Carturner, which makes devices that turn autos around, used by dealers and people with difficult driveways. Carturner was given the boot from a Vista location because he wouldn’t sign a three-year lease. His company is growing rapidly, he says, “and I don’t want to be locked in for three years and find that the space has become too small." He would like a lease of six months, perhaps out to a year, for maximum flexibility. But real estate brokers want to provide him three-year leases. He believes that’s because they want to maximize their incomes on the deal.

But Schwenker won’t get a six-month lease, says Nevin. The supply-demand squeeze has meant that “It’s difficult to find industrial space, even down at the border." Landlords can call the tune. Schwenker doubts that the vacancy rate is as low as Colliers says it is, but Nevin says it is the real deal. The market is tight.

Here's something you might be interested in.
Submit a free classified
or view all

Previous article

San Diego's punk music, goodbye to Lennon

Reader writers tell favorite music
Next Article

Jorge Hank's wealthy nephew heads for White House dinner

Tijuana billionaire's relative an AMLO invite
Carturner, which makes devices used by dealers and people with difficult driveways, was given the boot from  Vista.
Carturner, which makes devices used by dealers and people with difficult driveways, was given the boot from Vista.

It appears that San Diegans go to craft brewers located in industrial parks, put on weight, then go to to a fitness centers in industrial parks to shed that excess blubber. These are two reasons that San Diego has the lowest industrial vacancy rate in recorded history — 4.2 percent, according to Colliers International, which keeps tabs on real estate statistics.

Alan Nevin on Xpera site: “It’s difficult to find industrial space, even down at the border."

“Plain old industrial buildings are fading away — being converted to other kinds of uses [including] craft brewing firms by the hundreds,” says Alan Nevin, research director at Xpera Group. “This is driving down vacancy rates and driving up lease rates. Old tacky industrial space that was 75 cents a square foot is now $2 a square foot,” often after rehabilitation. Brewers locate in industrial parks because parking clears out at 5 p.m when customers arrive to imbibe.

Brewers are filling industrial parks, and so are “gyms, personal training centers, fitness facilities,” says Ken Robak, executive vice president of Pacific Coast Commercial. “Not a significant supply has been created and demand is up.” In the last two years, lease rates have gone up 20 percent in the squeeze, he says.

Leases have also lengthened. Nick Mane of Pacific Coast Commercial says, “Most owners [of the properties] want a three- to five-year lease term. In my five years, I have never done anything less than one year.”

This is a problem for Bill Schwenker, founder and owner of Carturner, which makes devices that turn autos around, used by dealers and people with difficult driveways. Carturner was given the boot from a Vista location because he wouldn’t sign a three-year lease. His company is growing rapidly, he says, “and I don’t want to be locked in for three years and find that the space has become too small." He would like a lease of six months, perhaps out to a year, for maximum flexibility. But real estate brokers want to provide him three-year leases. He believes that’s because they want to maximize their incomes on the deal.

But Schwenker won’t get a six-month lease, says Nevin. The supply-demand squeeze has meant that “It’s difficult to find industrial space, even down at the border." Landlords can call the tune. Schwenker doubts that the vacancy rate is as low as Colliers says it is, but Nevin says it is the real deal. The market is tight.

Sponsored
Here's something you might be interested in.
Submit a free classified
or view all
Previous article

Oceanside Democrats feud over membership

Club stacking just part of growing pains?
Next Article

Oceanside Democrats feud over membership

Club stacking just part of growing pains?
Comments
10

I'm seeing new industrial buildings going up on the eastern side of Carlsbad now, but not much anywhere else. Many users of such space find it advantageous to go there because their noise and customer parking doesn't annoy the neighbors.

It will never happen of course, but much of the now-excess retail space could be reused for industrial/commercial use. Big box retailers are even closing up (think Sports Authority), and there is a limit to the number of users standing in line waiting for the space. Convert an entire mall into an industrial park? Sounds strange, I know, but we may see that happen to one or more of the weakest local malls.

March 23, 2018

Visduh: It would certainly be wiser to convert a money-draining mall to an industrial park than just tearing it down. An enclosed mall would present perhaps insuperable problems, but an outdoor mall might not. Best, Don Bauder

March 23, 2018

If a business just wants a 6-month to 2-year lease, go month-to-month! The only smart thing for a business to do, if they are fully convicted to their chosen location, is to demand at least a 5-year lease with a 5-year option. If your business grows, you deal with it. But I guess time have changed since I leased commercial property. The best thing to do, if you can, is own the dirt.

March 23, 2018

Ponzi: Yes, owning the dirt is probably the wisest course -- unless business moves away from your location for some reason. Best, Don Bauder

March 24, 2018

Nothing goes up forever. Real estate and commercial rent/own is cyclical and one day the prices will drop and the landlords will forget how high the rents were and will whine about how much money they are losing.

March 24, 2018

AlexClarke: Yes, after they have stashed their boom-related loot. Best, Don Bauder

March 24, 2018

Well, the good news is you can go from industrial spot to the next and drink beer, the bad news is most of the craft breweries are too interesting in hoppy IPA's--unhappy!

March 28, 2018

Darren: I can't comment because I don't imbibe, but my wife and two sons like IPAs. Best, Don Bauder

March 29, 2018

Yes, the dilemma between entrepreneurs and landlords...

One of the major factors in failing startup and growing businesses failing is onerous business leases and lease terms... Of course, Landlords and their Brokers want maximum leases and values..maximum guaranteed revenues for at least 3-5 years etc.

Small, mid-sized and growing businesses want maximum flexibility, shorter term leases month to month or 6 month or 1 year leases..to manage their growing businesses and to have the flexibility to rapidly expand or contract as their business either takes off or tanks..

Oftentimes a bad, expensive, long term lease can be the tipping point that pushes an otherwise promising young company into financial ruin and BK court... Some of the biggest liabilities in corporate BK actions are oftentimes these long term business leases with onerous terms...

And, some of these lease terms for retail malls are just beyond outrageous for start up and growing businesses.

Percentage leases and Triple Net leases can be business killers for start ups and small growing businesses......Large brand name companies including regional and national chains are better able to pay those kinds of leases..

March 30, 2018

SportsFan0000: Schwenker is offering a similar argument. He wants a short lease -- maybe 6 months -- to give him maximum flexibility to expand. But Nevin says he won't get one that short in San Diego, but there is evidence that some of the larger young companies are getting short-term leases. Best, Don Bauder

March 30, 2018

Sign in to comment

Sign in

Art Reviews — W.S. Di Piero's eye on exhibits Ask a Hipster — Advice you didn't know you needed Best Buys — San Diego shopping Big Screen — Movie commentary Blurt — Music's inside track Booze News — San Diego spirits City Lights — News and politics Classical Music — Immortal beauty Classifieds — Free and easy Cover Stories — Front-page features Excerpts — Literary and spiritual excerpts Famous Former Neighbors — Next-door celebs Feast! — Food & drink reviews Feature Stories — Local news & stories From the Archives — Spotlight on the past Golden Dreams — Talk of the town Here's the Deal — Chad Deal's watering holes Just Announced — The scoop on shows Letters — Our inbox [email protected] — Local movie buffs share favorites Movie Reviews — Our critics' picks and pans Musician Interviews — Up close with local artists Neighborhood News from Stringers — Hyperlocal news News Ticker — News & politics Obermeyer — San Diego politics illustrated Of Note — Concert picks Out & About — What's Happening Overheard in San Diego — Eavesdropping illustrated Poetry — The old and the new Pour Over — Grab a cup Reader Travel — Travel section built by travelers Reading — The hunt for intellectuals Roam-O-Rama — SoCal's best hiking/biking trails San Diego Beer News — Inside San Diego suds SD on the QT — Almost factual news Set 'em Up Joe — Bartenders' drink recipes Sheep and Goats — Places of worship Special Issues — The best of Sports — Athletics without gush Street Style — San Diego streets have style Suit Up — Fashion tips for dudes Theater Reviews — Local productions Theater antireviews — Narrow your search Tin Fork — Silver spoon alternative Under the Radar — Matt Potter's undercover work Unforgettable — Long-ago San Diego Unreal Estate — San Diego's priciest pads Waterfront — All things ocean Your Week — Daily event picks
4S Ranch Allied Gardens Alpine Baja Balboa Park Bankers Hill Barrio Logan Bay Ho Bay Park Black Mountain Ranch Blossom Valley Bonita Bonsall Borrego Springs Boulevard Campo Cardiff-by-the-Sea Carlsbad Carmel Mountain Carmel Valley Chollas View Chula Vista City College City Heights Clairemont College Area Coronado CSU San Marcos Cuyamaca College Del Cerro Del Mar Descanso Downtown San Diego Eastlake East Village El Cajon Emerald Hills Encanto Encinitas Escondido Fallbrook Fletcher Hills Golden Hill Grant Hill Grantville Grossmont College Guatay Harbor Island Hillcrest Imperial Beach Imperial Valley Jacumba Jamacha-Lomita Jamul Julian Kearny Mesa Kensington La Jolla Lakeside La Mesa Lemon Grove Leucadia Liberty Station Lincoln Acres Lincoln Park Linda Vista Little Italy Logan Heights Mesa College Midway District MiraCosta College Miramar Miramar College Mira Mesa Mission Beach Mission Hills Mission Valley Mountain View Mount Hope Mount Laguna National City Nestor Normal Heights North Park Oak Park Ocean Beach Oceanside Old Town Otay Mesa Pacific Beach Pala Palomar College Palomar Mountain Paradise Hills Pauma Valley Pine Valley Point Loma Point Loma Nazarene Potrero Poway Rainbow Ramona Rancho Bernardo Rancho Penasquitos Rancho San Diego Rancho Santa Fe Rolando San Carlos San Marcos San Onofre Santa Ysabel Santee San Ysidro Scripps Ranch SDSU Serra Mesa Shelltown Shelter Island Sherman Heights Skyline Solana Beach Sorrento Valley Southcrest South Park Southwestern College Spring Valley Stockton Talmadge Temecula Tierrasanta Tijuana UCSD University City University Heights USD Valencia Park Valley Center Vista Warner Springs
Close