Los Angeles industrial real estate market report
Q4 2024

Anticipated demand for short-term subleases following potential East and Gulf port strikes did not materialize. Instead, companies have increased sublease availability as they streamline their industrial footprints to enhance efficiency and reduce costs. Many businesses are vacated pandemic-era spaces early or opting not to renew leases, contributing to a substantial reduction in industrial space utilization. This shift and decrease in demand activity has driven a 26.4% decrease in average rents, falling from $1.97/SF in 2023 to $1.45/SF in Q4 2024. Meanwhile, industrial construction activity in Los Angeles added 1,171,205 square feet in Q4 2024, bringing the annual total to 5,244,729 square feet. However, future development may face headwinds due to the implementation of California's AB 98 legislation. This law introduces stricter environmental standards to address community health and sustainability concerns, potentially slowing the region's industrial growth trajectory.
Inventory
There is currently 5.0 MSF of industrial product under construction. In total, there is 552.6 MSF of industrial product in the Los Angeles market.
Net absorption
Net absorption remained in the red with 3.1 MSF of negative net absorption was reported in Q4 2024.
Asking rent
Average asking lease rates continue to cool down in Q4 2024 to $1.45/SF. Average asking lease rates have dropped nearly 27% from Q2 2023.
Availabilities
Total available direct space dropped slightly to 41.0 MSF and sublet space increased to 11.1 MSF in the fourth quarter.
Vacancy
Total vacancy this quarter registered at 7.4% with 6.0% being direct and 1.4% being sublet.
Investment sales
Investment sales in the Los Angeles industrial market reported a total sales volume of over $3.6B for 2024 and an average sales price of $307/SF.
Your source for the latest Los Angeles industrial real estate reports
Stay on top of current trends affecting the industrial real estate sector in Los Angeles. Gain an overall better understanding of Los Angeles's industrial real estate market conditions, so you can better formulate strategies to overcome any obstacle and know how to best invest in industrial real estate in Los Angeles.
Here, you’ll always find the latest industrial real estate market news so you can stay ahead. Come back often to see expert insights on the current and future of Los Angeles industrial real estate market.