Harley Knox Logistics Center in Perris, California, is an example of the type of industrial space that’s in demand in the GLA/OC/IE region. | Courtesy Newcastle Partners Inc.

E-commerce Puts SoCal Leasing 4 Percent Above Five-Year Average

Carrie Rossenfeld Industrial

The growth in e-commerce sales throughout the nation and Greater Los Angeles/Orange County/Inland Empire (GLA/OC/IE) region increased substantially over the last five years, the ripple effect of which translated into rising industrial demand and development, extending the current growth cycle, CBRE reports. The migration by e-commerce related users to the region since 2013 accounted for 36.3 percent of gross activity. Industrial leasing is currently 4 percent above the five-year average in the region, demonstrating the current demand of e-commerce on leasing activity levels, the firm says.

Analyzing e-commerce impact on transportation and warehouse (T&W) employment has become essential in determining future industrial growth, CBRE also states. T&W employment increased annually in stride with industrial demand, and the abundance of highly skilled labor solidified GLA/OC/IE as a major hub for e-commerce users occupying warehouse facilities.

Since 2013, T&W employment growth has kept pace with industrial growth. Strong e-commerce growth and favorable consumer demand from 2013 to 2017 resulted in more than 73,920 new T&W jobs throughout the GLA/OC/IE region, says CBRE. The area’s densely populated metros, coupled with healthy local economies, offered increased employment opportunities.

Moreover, CBRE reports that in spite of concern is that e-commerce demand is siphoning skilled labor, since 2013, T&W employment in California has increased by 66 percent from workers crossing from one industry to another, according to the U.S Census Bureau. Moving forward, CBRE predicts that T&W labor supply will be instrumental to further industrial growth since e-commerce demand has transformed the supply-chain impacting real estate and development decisions. Also, the firm says the GLA/OC/IE region’s reputation nationally as a major industrial labor hub will continually draw more industrial users.