These drivers are creating significant demand and development activity. While the Easter Pennsylvania market has more land available for development than the Southern California market, especially in infill Los Angeles. “Even though we have more land, we don't have a lot that is easily actionable from a development standpoint, and that is another reason why there have been rising land prices,” says Vanbuskirk.

As a result of limited availability, Eastern Pennsylvania is seeing rent growth, although it is more moderate that the rent growth in Southern California. “If you want to be in the top locations, you are really going to have to pay up. Land is going higher, and prices are increasing as a result,” adds Knowles.

The demand is also creating an opportunity for redevelopment of former manufacturing facilities. In the Southern California market new companies have launched to take advantage of these opportunities. In Eastern Pennsylvania, they are seeing a similar trend. “We are also starting to see more redevelopment,” says Vanbuskirk. “There are two projects where former manufacturing facilities have been demolished to make room for distribution centers. When you start tearing down old buildings, it really points to the pressures in the market.”

The Eastern Pennsylvania industrial market is mirroring Southern California's industrial activity. With similar fundamentals and port proximity, both markets have seen tremendous growth in the last few years. The Eastern Pennsylvania market currently has a 5.85% vacancy rate and 20.1 million square feet under construction, while the Los Angeles submarket has a 1.2% vacancy rate and the Inland Empire market has a 3.6% vacancy rate and the combined markets have more that 35 million square feet under construction.

“When the market started to pick-up a few years ago, it started to pick up in the Inland Empire and Eastern Pennsylvania,” Brian Knowles, a principal at Lee & Associates Eastern Pennsylvania office, tells GlobeSt.com. “If you look at the dynamics of those two markets, there are population growth, access to ports, rail infrastructure and the network available to population density. The dynamic between those markets is interesting because it is the same names, same investors and tenant occupiers in the two markets.”

With a similar growth trajectory, it is no surprise that the drivers and market dynamics are similar. Both markets are proximate to some of the largest ports in the US, although the Long Beach and Los Angeles ports handle the majority of the cargo volume for the US, and have access to a large population. “A lot of the things that are driving Southern California from a dynamic standpoint exist here and in New Jersey, which supports the same market area,” John Vanbuskirk, a principal at Lee & Associates Eastern Pennsylvania office, tells GlobeSt.com. “There area has a lot of parallels between what is happening in Southern California and what is happening in here, specifically as it relates to rents. We are seeing appreciable rent growth in the Lehigh Valley and modest rent growth in the Lee High Valley.”

Ecommerce is also a significant driver, as it is for many industrial markets, and it is driving demand. “We are early in the conversion of conventional retail into e-tail,” says Vanbuskirk. “When you have the infrastructure, like we have in Easter Pennsylvania, and proximity to the densely populated and wealthy, you are going to continue to see really strong demand. A lot of it will be new to market, and we are poised to be a big beneficiary of that.”

These drivers are creating significant demand and development activity. While the Easter Pennsylvania market has more land available for development than the Southern California market, especially in infill Los Angeles. “Even though we have more land, we don't have a lot that is easily actionable from a development standpoint, and that is another reason why there have been rising land prices,” says Vanbuskirk.

As a result of limited availability, Eastern Pennsylvania is seeing rent growth, although it is more moderate that the rent growth in Southern California. “If you want to be in the top locations, you are really going to have to pay up. Land is going higher, and prices are increasing as a result,” adds Knowles.

The demand is also creating an opportunity for redevelopment of former manufacturing facilities. In the Southern California market new companies have launched to take advantage of these opportunities. In Eastern Pennsylvania, they are seeing a similar trend. “We are also starting to see more redevelopment,” says Vanbuskirk. “There are two projects where former manufacturing facilities have been demolished to make room for distribution centers. When you start tearing down old buildings, it really points to the pressures in the market.”