Development Begins Here After 10-Year Lull

Couvillion: “As the market in Escondido continues to grow stronger, more businesses are looking to locate in the area, thus creating a critical need for new industrial development.”

ESCONDIDO, CA—With no new industrial development in more than a decade and current vacancy levels around 1.9%, Escondido, CA, can best be described as undersupplied—but that is beginning to change, Badiee Development ‘s VP of development John Couvillion tells GlobeSt.com. The firm plans to develop the Escondido Victory Industrial Park following the $1.3-million acquisition of a 4.87-acre parcel at 2005 Harmony Grove Rd. here, ending a 10-year lull in industrial development in this submarket of San Diego. Colliers International ‘s Tucker Hohenstein and Mike Erwin were the listing brokers for the industrial park. The planned two-building, 91,000-square-foot project, designed by Ware Malcomb , is suited for one or two larger tenants and will feature a 26-foot clear height, grade-level and dock-high loading, mezzanine space and outdoor common areas that enhance connections to the Escondido Creek and trails. Badiee plans to break ground in late Q4. We spoke exclusively with Couvillion about the industrial market in Escondido and where he sees it heading now that the dry development spell has been broken. GlobeSt.com: How would you characterize the industrial market in Escondido? Couvillion: With no new industrial development in more than a decade and current vacancy levels around 1.9%, the second lowest in the county, it can best be described as undersupplied. Even further, a significant portion of the existing inventory in Escondido is about 25 years old and typically is small industrial outfits and contractor yards. These factors combined leave a critical space in the market for contemporary, highly functional industrial product. GlobeSt.com: What led to the lull in development in this market, and what has caused this to change?  Couvillion: Escondido’s industrial market, like many others around the county, was greatly affected by economic downturn in 2008, but in recent years we have seen the return of a healthy market. Escondido’s recovery has been quicker than other submarkets because it is one of the smallest North County submarkets (7.45 million square feet) and offers highly competitive rental rates. As the market in Escondido continues to grow stronger, more businesses are looking to locate in the area, thus creating a critical need for new industrial development. GlobeSt.com: What do you anticipate for this market in the coming year?  Couvillion: The Escondido industrial market will continue to flourish over the next two years, with continued low vacancy rates and new industrial development. As North County’s land supply for new development opportunities continues to shrink, this new industrial product will be in high-demand and likely achieve premium rental rates. GlobeSt.com: What else should our readers know about the Escondido industrial market?  Couvillion: Escondido has an extremely ideal location for industrial users with convenient access to I-15 and Highway 78 and close proximity to Vista and San Marcos.