Shein Joins Apparel Logistics Hub in Inland Empire

Central Riverside County in SoCal’s Inland Empire continues to be the epicenter of a growing logistics hub for the apparel industry.

Fast-fashion retailer Shein this week became the latest national apparel brand to disclose plans to occupy a mega-warehouse in the region. The City of Industry-based company, owned by a Nanjing tech firm, told the Wall Street Journal it will soon plant its logistics flag in SoCal.

Shein is expected to pre-lease space at a 1.8M SF distribution center under construction Cherry Valley. The campus, developed by a joint venture of Shopoff Realty Investments and Artemis Real Estate Partners, includes two buildings, a 1M SF warehouse and an 811K SF industrial building.

Shein is planning to open three US distribution centers in coming months. In addition to the SoCal facility, the company is planning to expand an existing facility in Whitestown, IN and to occupy a warehouse in a location yet to be chosen in the Northeast.

Shein is the third apparel player to establish a distribution operation in Riverside County this summer.

In July, a joint venture of Trammell Crow and Clarion announced that two warehouses encompassing 1.1M SF under construction in the JV’s sprawling Knox Logistics Center have each been fully pre-leased to single tenants.

Apparel retailer Burlington Stores has signed a 410K SF lease to occupy all of Knox IV, while an identified logistics services provider has inked a deal to lease all of Knox III, a 693K SF facility.

Also, in July, USAA Real Estate and McDonald Property Group broke ground in Beaumont—about 30 miles northeast of Perris and just south of Cherry Valley—on a 1.8M SF manufacturing and distribution facility for NY-based United Legwear & Apparel.

The Inland Empire industrial market remains the tightest in the nation with an 0.4% vacancy rate that essentially means it’s filled to capacity, a situation that has been exacerbated for the past year by the backlog at the Ports of Los Angeles and Long Beach, according to JLL’s Q2 2022 market report.

An estimated three-quarters of the record 39M SF of industrial space under construction in the Inland Empire—9.2M SF was added to the pipeline during Q2—already has been pre-leased, with pre-leased space the primary driver of next absorption in the second quarter as existing availabilities have been extremely limited.

The industrial warehouse sprawl in the two-county region that stretches from the LA city limits to the Arizona border is now exceeding an estimated 2.3B SF, with new logistics facilities pushing north and east and facing a growing backlash from several towns that are moving to enact moratoriums or bans on new warehouse construction.