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acancy rates in Southern California's vast industrial spaces have reached a 5.1% average, marking the 11th consecutive quarter of rising vacancies across the five-county region. According to Colliers, this rate has been steadily increasing since the end of last year, with a notable jump of 0.3% in the three months leading up to December.

    The industrial slump is attributed to higher interest rates, reduced e-commerce supply deliveries, and decreased investment. Despite a dwindling supply of new industrial real estate, the combined availability rate for Los Angeles County, the Inland Empire, Orange, and Ventura counties rose to 7.9% last quarter, a 12-year high.

    The average asking rent for industrial space in the region has dropped to $1.32 per square foot, a 17% decrease from the end of 2023. Net absorption was negative 377,000 square feet last quarter, but this is an improvement from previous periods. The Inland Empire, which accounts for 37% of all industrial properties over 10,000 square feet in the Southland, saw significant variations in vacancy rates between its western and eastern regions.

    The western Inland Empire experienced a decline in vacancy to 5.2%, while the eastern region's rate rose to 8.6%, a level not seen since 2012. Average availability across both regions was 10.3%. Leasing activity in the Inland Empire reached 10.9 million square feet last quarter, which Colliers projects will help reduce vacancy rates.