During the boom years of the Southern California ports immediately before the global economic meltdown, one of the ancillary impacts of the intense cargo growth was the tremendous development of warehouses and commercial real estate in the region. When cargo volumes at the ports of Long Beach and Los Angeles tumbled during the economic downturn, so too did the development, acquisition and lease of warehouses and commercial space in the area.
With both ports now in full rebound mode, warehouse and commercial property is again beginning to show some signs of following suit.
The latest example is the purchase of a 72,000-square-foot ports-area commercial building by a Chinese logistics firm.
The building, which has sat vacant for more than a year, was sold to Hong Kong-based third party logistics firm F.C.C. Logistics Ltd. for $5.3 million. Several firms were competing to purchase the building, which is located about five-miles from the neighboring ports.
According to research by CoStar, "pricing for commercial property sales in the top ten largest markets is recovering much stronger than the general market with the exception of retail." CoStar ranks the Los Angeles region as the number one market in the nation for commercial property.
Dr. Norm Miller, the Vice President of Analytics for CoStar said that the real activity typically seen moving in conjunction with increased port activity is commercial property leases.
"Purchases are more a function of the capital markets," Miller said, "but we have seen an increase in the Southern California lease activity as the ports have begun to rebound."
Monday, March 7, 2011
