Waiting for Industrial Foreclosures-Low Interest Rates

Just a quick note today on the state of the Orange County Industrial Real Estate "for sale" market. Interest rates are near record lows, yet there were only a dozen sales in the first quarter. Most businesses are simply renewing leases, or staying put in owner-occupied buildings. Many of those business owners who are considering a purchase are waiting for significant price reductions, similar to the 50% reductions we have seen in many residential markets. As of this date, many would-be Sellers have reduced their sale prices, but apparently not enough to increase demand from the buyers.

Some experts are predicting a substantial supply of foreclosures in the industrial real estate market later this year. I believe that there will be some good opportunities, and several developers are already saying "no reasonable offer will be refused" on their recent construction and condo conversions. The Inland Empire has a much higher vacancy rate, so expect dramatic price and lease rate reductions in those areas.

Whether you are in the market for a building to occupy, or for investment-or you are considering the sale or lease of your building, call me at 949-646-2727 for an accurate appraisal considering competition and recent sales/leases.

Warren Buffet checks in with Colossal Losses

Even the "Oracle of Omaha" hasn't been immune to our economic changes. Read his annual letter to shareholders http://www.berkshirehathaway.com/letters/2008ltr.pdf

Industrial Brokers is seeing a sharp slowdown in Orange County industrial transaction activity. Landlords are busy with tenant retention efforts, and buyers are awaiting price drops similar to those in the local residential market. There haven't been enough sales this year to guage who is winning that tug-of-war, but we suspect that it will be the buyers gaining advantage soon.

Call me today at 949-646-2727, if you have any questions about your Orange County industrial property or lease.