At a time when the prospects for industrial space look brighter across the nation, both sales and rent growth of industrial properties in California are booming, with spillover effects benefiting Phoenix.

Three California metros were the only ones nationally to see double-digit rent growth for industrial spaces. Rent appreciated 17.4% year-over-year through September in the Inland Empire, 11.8% in Los Angeles and 10% in Orange County, according to CommercialEdge's October 2023 national industrial report. Rents in the Bay Area jumped 7.1%. In-place rents in Seattle increased 8.5%.

The ripple effects have also touched Phoenix. Demand for industrial space here has risen "partly due to its standing as an overflow market for Southern California and its status as an emerging manufacturing hub," CommercialEdge noted. "A new supply boom has yet to dampen in-place rent growth or send industrial vacancy rates (2.7%) upward."