Econowatch

Econowatch/7/Netherby/dt1st/mike2nd By JENNIFER NETHERBY Staff Reporter Industrial vacancy rates rose in most areas of the San Fernando Valley during the 12 months ended June 30, according to Grubb & Ellis Co. The Conejo Valley saw the biggest increase in vacancy rates, from 1.5 percent in second-quarter 1998 to 7.8 percent in second-quarter 1999. Jim Linn, senior vice president at Grubb & Ellis, said the increase is probably due to a combination of factors, from new industrial space coming on line to the fact that companies are increasingly moving to the Santa Clarita Valley and other parts of the San Fernando Valley. “It’s a very tight market,” Linn said. “You may be seeing a few more people put their buildings on the market for sale or lease. Building prices are now finally back to the numbers that people paid for their property. Many companies are expanding now to larger facilities.” Vacancy rates increased in the overall San Fernando Valley to 5.9 percent for second-quarter 1999, from 3.3 percent in the like year-earlier quarter. The second-quarter Valley industrial numbers were essentially unchanged from the first quarter. The East Valley had the lowest vacancy rate, at 4.1 percent, but that was still up from 2.3 percent a year ago. The cost of Valley industrial space averaged 54 cents a square foot, roughly the same as the last few quarters, Linn said. Roughly 250,000 square feet of industrial space is expected to come on line in the next year in the West Valley and Van Nuys, which may lead to a further vacancy increase, Linn said.