JLL has done similar recruiting in Phoenix, Las Vegas, Salt Lake City and San Diego as part of our overall strategy to expand our industrial capital-markets expertise. We tapped Bo Mills and Mark Detmer, who have a growing industrial investment-sales practice, to lead our broad West Coast effort. This recruiting has really paid off with revenue up by 39% over last year and a 61% rise in transaction value.

GlobeSt.com: What has prompted this growth?

C.M.: Our strategic growth is in response to increased demand for our services from our key corporate and institutional clients. Across the board, there has been a huge appetite, especially from our corporate clients, to either expand or acquire new properties and facilities. On the investment side, demand by institutional capital for class-A industrial product has been exceptionally strong, especially in the Inland Empire where we are back to pre-recession levels of activity.

GlobeSt.com: What's next for JLL's West Coast industrial team?

C.M.: Currently, growing our firm's industrial property-management business is a top priority as our institutional investor clients are asking us to assist them with new portfolios they have acquired over the last couple of years. We recently hired Amos Bracero, based in our Irvine office, to oversee industrial property-management in the Southwest. In terms of brokerage, we'll continue to add depth opportunistically in certain submarkets as needs arise. At this stage of the game, we think that we are well positioned to respond to both our corporate and institutional clients in every major market in the West.

GlobeSt.com: Which players are currently out in the market? What are they looking for and where?

C.M.: Industrial tenants, especially the distribution operations for major retailers and large third-party logistic firms (3PLs) continue to seek space across the region. Demand is healthy, especially in Southern California, for big-box distribution space, primarily in the Inland Empire. Port traffic at Los Angeles/Long Beach is back at pre-recession levels, and despite all the financial issues around the world, global trade volumes are up and are exceeding GDP growth.

GlobeSt.com: What do you expect to see over the next 12 months for the region?

C.M.: We expect to see demand continue for big-box distribution and for e-commerce facilities. Traditional bricks-and-mortar retailers are increasingly setting up e-commerce fulfillment centers in addition to, or even side by side, their existing warehouses. In many ways, e-commerce is the new manufacturing, meaning that their facility requirements in many ways mimic those of manufacturing firms. The e-commerce users need ceiling heights of 32 ft. to 36 ft. as the new norm, require three times the power of a typical warehouse building in order to handle the HVAC, lighting and charging capacity for picking systems and forklifts. These buildings are people-intensive and need to park a minimum of 2/1,000. Some will have more than 1,000 employees working over two to three shifts. As a result, building coverage has decreased to meet both parking and increased trailer storage requirements.

Most of this demand is concentrated in the large Western logistics markets, specifically the Inland Empire, Phoenix and the Livermore-Stockton submarket of Northern California. We see sizeable absorption gains in each of these markets in the year ahead. In the Inland Empire alone, there is more than 20 million square feet of active requirements in the market as of the first of the year and with only 9.7 million square feet under construction. Demand is far exceeding supply, and there will be pressure for rents to rise. In Northern California, we are tracking more than 18.3 million square feet of active requirements from Silicon Valley to Sacramento, an all-time high in recent years.

In the East Bay, we have seen older “infill” manufacturing sites such as the Goodman Birtcher project near the Oakland Airport being redeveloped. The Oakland Airport Logistics Center will deliver more than 350,000 square feet of class-A, high-cube space in a very tight and significant submarket. The Central Valley is poised for an uptick in leasing activity. Firms such as Westcore are making a huge play by acquiring the 9-million-square-foot JB portfolio in Sacramento for a classic repositioning. They anticipate demand to spill over into smaller mid-size spaces and are therefore investing significant dollars to upgrade their entire portfolio to capture this.

Moving further north, Seattle's positive net absorption as seen on the second half of last year indicates a strong 2013. Seattle is a supply-constrained market and has seen relatively low, single-digit vacancy rates. Seattle's positive industrial climate is encouraging a number of development projects such as the IDS/Clarion project that will deliver more than 650,000 square feet of class-A, high-bay distribution space. All in all, we expect 2013 to mirror 2012 for the region.