How Can We Help You?

Sector and market analytics

Driven by economists and leveraged by market makers.
CRE performance across major metros and asset classes. History and forecast by CBRE.

Thought leaders abound

Depth, breadth and rigor concentrated at all levels.
Synthesizing macro factors and leading indicators into actionable national, sector and market research.

Advantage is CBRE

Perspectives, scale and connections that work.
Commercial and cultural insight aligned with intellectual capital and experience to fuel informed real estate decision-making.

Which data are right for you?

Data views and extracts by scenario and on demand.
Check out the fundamentals, capital markets, and data tools now on our one-pager.

Experience the platform

See first hand why top institutional investors, direct lenders and private equity firms are clients.
Set a time that works for you.

Econometric Advisors' blog

Southern California’s outlier markets may provide industrial investment opportunity

May 11, 2023, 09:32 AM by Matt Mowell

 Is every real estate deal unique? Or does each deal provide a point in a broader spatial pattern? And if broader patterns can be discerned, are there investment opportunities from identifying market outliers?

 To answer these questions, CBRE Econometric Advisors (CBRE EA) mapped all the industrial property sales in Southern California over the past two years and then applied geospatial analytics to identify trading patterns. We algorithmically identified 47 deal clusters, which are numbered on the map below.

 Generally, the clusters overlap the region’s key industrial nodes. To generate a proxy for relative value, we averaged the price per sq. ft. for each property sold and the typical in-place rent within each cluster. Clusters are color coded to illustrate how these metrics relate to the broader regional average.

 The results show that clusters in densely populated places with elevated land values tend to achieve both high sales prices and rents. Conversely, despite heavy sale volume, buildings in the Inland Empire traded at average-to-slightly discounted prices, likely reflecting their relatively lower replacement costs and a decade-long construction boom that suppressed rent levels.

 The market outliers are the interesting part of this exercise. Investment clusters in Los Angeles County, from Covina (32), south to Buena Park (21), and into the northwestern corner of Orange County (47) generally offer higher rents at a higher price per sq. ft. A similar trend can be found within the far northern tier of Los Angeles County, including in Northridge (18) and Santa Clarita (24).

 Industrial properties in many of these markets tend to be smaller and cater to a local tenant base. Thus, they are often not on the radar of institutional investors. Smaller properties with fewer credit tenants may have limited appeal at a time when investors are risk averse. However, as market conditions improve, they may offer a compelling opportunity due to their lower price per sq. ft. and above-average rents, as well as a modest new construction pipeline in the local area.


By Matt Mowell, Jamie Portolese, Franz Limoges, Nicholas Rita, Dennis Schoenmaker, Ph.D.

Ready to Get Started?

60 second demos.


Experience the platform.


Become a client.

redirect pin user minus plus fax mobile-phone office-phone data envelope globe outlook retail close line-arrow-down solid-triangle-down facebook globe2 google hamburger line-arrow-left solid-triangle-left linkedin play-btn line-arrow-right solid-triangle-right search twitter line-arrow-up solid-triangle-up calendar globe-americas globe-apac globe-emea external-link music picture paper pictures play gallery download rss-feed vcard