Better Yields Draw Industrial Institutions to San Diego
By Kelsi Maree Borland | August 21, 2018 at 04:00 AM
Institutional industrial investors are setting their sights on San Diego for better yields. While Los Angeles, Orange County and the Inland Empire have been hotbeds of industrial activity in Southern California, pricing in the markets has increased to record highs. Now, activity is moving to San Diego, where demand is heating up and absorption and rental rate growth are just beginning to reach record levels.
“When institutional investors think industrial in Southern California, their first thought is typically Los Angeles, Orange County or the Inland Empire,” Bob O’Neill, SVP of acquisitions at CapRock Partners, tells GlobeSt.com. “As these areas become extremely supply constrained, many in the institutional space are turning to San Diego investments for slightly higher yields than the aforementioned infill markets. With its strong biotech, electronics, defense, healthcare, tourism, manufacturing and telecom sectors and the eighth largest population in the Unites States, San Diego is a prime location for industrial development. Institutional investor interest in San Diego has accelerated significantly in the past year or so, especially in the central and northern areas of the county, as absorption, rental rate growth and industrial activity reach record levels.”
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