Industrial real estate had a record-setting year in 2016 with vacant spaces filling up, new construction on the upswing and rents rising for the third year in a row, according to a report from Colliers International.
In Fresno, the industry saw an uptick in business thanks to relocating many of the more than 150 companies displaced by high-speed rail construction and by finding space for online companies looking for a central location in California where goods can be shipped within a day or two.
“Given the continued shift towards online consumer shopping, industrial property is well positioned to remain commercial real estate’s best performer,” the report said.
“With the recent interest from large fulfillment centers such as Amazon, Ulta, and Nordstrom’s, Fresno’s industrial real estate future looks promising.”
Fresno’s vacancy rate dropped from more than 9 percent in 2011 to below 5 percent at the end of last year, an “unprecedented” rate, the report said. The Visalia and Tulare industrial market saw vacancy drop from more than 7 percent in 2012 to a low of 1.9 percent at the end of 2016.
Speculative development, building without a specific use or tenant signed on, is still scarce, but local developers building warehouse and manufacturing space between 5,000 and 25,000 square feet are struggling to keep up with demand.
“Quality available properties do not remain on the market for long,” the report said.
Southwest Fresno had the lowest total vacancy rate at 2.08 percent followed by northeast Fresno with 2.8 percent. The south Highway 99 corridor had the highest vacancy at 12 percent.
Significant sale and lease transactions completed by Colliers in 2016 include:
▪ 185,000 square feet, former Odwalla Plant in Dinuba, sold to Dinuba Investments LLC, $10.2 million
▪ 115,000 square feet, 2788 N. Larkin Ave., sold to 2788 N Larkin Associates, LLC, $3.7 million
▪ 208,300 square feet, 2626 S. Maple Ave., leased to undisclosed tenant