Ron Mgrublian

10680 SILICON AVE MONTCLAIR, CA, 13-S

Industrial Condo

Size ±3,699 SF

PROPERTY FEATURES

• Brand New Construction

• High Clear 28’

• Highly Desirable Business Park Setting

• Great Inland Empire West Location

• Close to 10, 71 & 60 Freeways

10680 SILICON AVE MONTCLAIR, CA, 20-A

Industrial Condo

Size ±3,699 SF

PROPERTY FEATURES

• Brand New Construction

• High Clear 28’

• Highly Desirable Business Park Setting

• Great Inland Empire West Location

• Close to 10, 71 & 60 Freeways

South Bay Submarket Q1 2025 Overview Summary

• Vacancy/Availability: The vacancy rate rose to 5.6%, up 70 basis points year-over-year, with Carson (7.9%), Compton (9.7%), and Rancho Dominguez (10.8%) seeing the largest increases. High-end properties now take 12.2 months to lease, shifting leverage to tenants. Landlords are offering more concessions, with 10.28 million square feet of vacant/available space. The market needs to absorb 5.1 million square feet to return to a 3% vacancy rate.
• Rental Rates: Average asking rents fell to $1.61 NNN, down 1.4% quarter-over-quarter and 8.0% year-over-year. After a 118% rent surge from Q2 2020 to Q2 2023, increased vacancy (10 MSF added) is driving further declines until leasing rebounds.
• Construction: Construction totals 1.4 MSF, with 360,466 SF delivered in Q1. Seven buildings are under construction, but new starts are limited, and no projects are preleased. Developers are pausing, waiting for tenants or better market conditions, which may increase vacancy if leasing doesn’t improve.
• Leasing Activity/Absorption: Net absorption was positive at 561,683 SF, but cumulative absorption since Q1 2023 is negative at -4.7 million SF. Leasing volume hit 1.3 million SF across 103 transactions, below the historical 2.5 million SF quarterly average. Buildings now take six months to lease.
• Sales Activity/Investment Trends: Investor caution persists due to high interest rates and economic uncertainty, widening the bid-ask spread. Despite lower deal volume, the South Bay attracts capital due to high rents and limited land. The region is poised for an investment rebound as borrowing costs ease.

The South Bay market faces challenges with rising vacancy and declining rents but retains strong fundamentals for future growth.

Additional Reports for Midcounties, Central and Inland Empire Included.

Available : ±1,800 – ±6,600 

Lot Size: ±40,847 SF of Land

Rate: $1.65 gross

Term: 3-5 years

Zoning: C-P (PCD)

APN: 8447-031-038

Park-like setting: The building is situated in aserene environment with beautiful views of the park.

Ample parking: Large lot with ±28 Parking Spaces

Next to 10 Freeway with close access to 57, 71, 210 & 60 Freeways

AVAILABLE: ±25,660 SF of Land

ZONING: I2

TERM: 3-5 Years

• Block Wall

• Paved Yard

• Power and Water Available

• Office Trailer

• Close to 60, 71 and 10 Freeways

BUILDING SIZE: ±6,670 SF

LOT SIZE: ± 0.3 Acres

RATE: $1.50 Net

TERM: 3-5 years

APN# 7271-009-005

ZONING: IG

• Secured Fenced and Paved Yard

• Adjacent To Port of Long Beach

• Two (2) Street Accesses

• Four (4) Loading Doors

• High Quality Building Divisible to Two (2) Units

• Immediate 710 Freeway Access

·  Industrial space demand has softened, raising the vacancy rate from 1.8% to 5.5% over eight quarters. 

·  Net absorption in 2024 hit its lowest level in over a decade. 

·  Rental rates continued to decline throughout 2024. 

·  Available sublet space reached a record high. 

·  Tenant activity remains weak, indicating slower business growth plans. 

·  Market uncertainty is tied to the U.S. elections and potential tariff impacts. ·

  Leasing activity fell 5.3% for the year, with Q4 down 28% from 2023. 

·  Orange County’s net absorption was negative 1.19 million SF in Q4 and negative 5.27 million SF for the year.

Southbay Submarket Key Highlights (Download Report for Midcounties, Central & Inland Empire Submarkets)

• Vacancy/Availability
  • Vacancy rate in Q4 2024 increased to 5.2%, up 80 basis points from Q3 and 130 basis points year-over-year.
  • High-end properties linger on the market for an average of 7.2 months, giving tenants more leverage in negotiations.
  • Total vacant available space expanded to 10.4 million square feet by the end of Q4.
• Rental Rates
  • Average asking rents fell 1.2% ($0.02) quarter-over-quarter and 8.9% ($0.16) year-over-year.
  • South Bay rents increased 34.1% between Q4 2020 and Q4 2024, reaching $1.63 NNN per square foot.
  • Only 76 lease transactions were completed in Q4, well below the historical quarterly average of 105 transactions.
• Construction
  • 1.37 million square feet under construction across 10 buildings in South Bay.
  • Two new buildings totaling 263,060 square feet were added in Q4 2024.
  • None of the 10 ongoing projects, including six exceeding 100,000 square feet, have been pre-leased, posing risks of higher vacancy rates.
• Leasing Activity/Absorption
  • Net absorption in Q4 2024 was -1.47 million square feet, continuing a negative trend since Q4 2022 (except for Q3 2023 and Q3 2024).
  • New leasing activity totaled 1.19 million square feet, well below the long-term quarterly average of 2.59 million square feet.
  • Average time to lease a building in South Bay increased to 6.4 months.
• South Bay Submarket: Top Leases in Q4 2024
  • 2027 Harpers Way, Torrance: Virco Manufacturing, 10/01/24, 559,000 SF.
  • 24760 S. Main St., Carson: DCW, Inc., 10/22/24, 231,008 SF.
  • 250 W. Manville St., Compton: Kair Harbor Express, 10/01/24, 206,483 SF.
  • 2230 E. Carson St., Carson: JAM-N Logistics, 10/01/24, 198,292 SF.
  • 18111 S. Santa Fe Ave., Rancho Dominguez: Air Products Manufacturing LLC, 10/01/24, 136,980 SF.
• Sales Activity/Investment Trends
  • Q4 2024 sales volume reached $375 million across 14 transactions, up from $163 million in Q4 2023.
  • Average price per square foot rose 36% quarter-over-quarter and 15.6% year-over-year, reaching $386.48.
  • Capitalization rates increased 160 basis points to 6.0%.
  • The Federal Reserve cut rates by 100 basis points in 2024, with further cuts expected in 2025.
  • Investor activity remains cautious amid policy uncertainties.
• South Bay Submarket: Top Sales in Q4 2024
  • 2501 Rosecrans Ave., Los Angeles: Rexford Industrial Realty, Inc., 12/06/24, 300,201 SF.
  • 18500 Crenshaw Blvd., Torrance: Gpjco Properties LLC, 12/05/24, 180,269 SF.
  • 2550 El Presidio St., Carson: Caroline Tseng, 10/31/24, 130,055 SF.
  • 15914 S. Avalon Blvd., Compton: Access Services, 12/02/24, 75,431 SF.
  • 14455 S. Broadway, Gardena: Aleah Miller, 11/27/24, 58,723 SF.

AVAILABLE: ±27,896 SF (±0.64 Acres) of Land

ASKING RATE: $7,500 per month($0.27 PSF gross)

ZONING: B/R-MU

• Short Term Lease

• Truck Parking Possible

• Fenced Yard with Aggregate

• Water/Power Possible

• Close to 10 and 210 Freeways

Available: ±5,000 SF to ±20,847 SF

Lot Size: ±40,847 SF of Land

Sale Price: $7.9M

Lease Rate: $0.85 / SF Gross for the first 6 months,$1.70 thereafter

Term: 3-5 years

Zoning: I-C

APN#: 8550-005-061

• High Image/Freeway Visibility

• Two (2) Dock High

• Three (3) Ground Level Doors

• 28’ Minimum Clearance Height

• Cannabis Potential

• 1240 Amps

• Large Fenced / Paved Yard

• 42 Parking Spaces

• See Brochure for 3D Matterport Virtual Tour

GDP Growth: 

• U.S. GDP grew at an annualized 2.8% in Q3, slightly below Q2's 3%.
• Consumer spending rose 3.7%, the fastest since Q1 2023, but residential investment dropped 5.1%, its second consecutive decline.
• Inflation hit the Fed's 2% target, with unemployment steady near 4%.

 Employment: 

• 254,000 jobs were added in September, the largest gain in six months.
• The unemployment rate fell to 4.1%, while wages increased 4% year-over-year.
• Upward revisions to prior months' job numbers highlight ongoing labor market resilience.

 Monetary Policy: 

• The Federal Reserve cut interest rates by 0.5% in September, lowering the federal funds rate to 4.75%-5%.
• Strong job data makes further significant rate cuts unlikely.
• Fed Chair Powell emphasized balancing inflation control with stable employment.

 Global Economy: 

• IMF projects global growth of 3.2% for 2024-2025, with risks from regional conflicts and trade disruptions.
• Emerging Asia sees growth upgrades due to semiconductor demand, while Europe faces downgrades.
• Global inflation is expected to decline from 6.7% in 2023 to 5.8% in 2024 and 4.3% in 2025.
• Long-term growth remains constrained by aging populations and weak productivity.

• The Inland Empire West submarket experienced a stall in net activity during Q3.
• Subleases and renewals dominated top lease transactions.
• Vacancy rates increased slightly, while availability trended downward.
• Pricing remained steady, but tenant concessions (e.g., free rent, tenant improvements) have risen and are now widely expected.
• Industrial construction slowed significantly, with the development pipeline at 43% of its year-over-year level.
• Institutional interest in the market continues to grow despite reduced activity.