West County’s Available Business Space Tightens
Vacancy rates for office and industrial properties have generally gone down in west Ventura County, signaling an improvement in the local economy, real estate analysts said Thursday.
The tighter market in the west county was attributed in part to a shortage of usable space in east county cities.
The figures were released by Grubb & Ellis Co. as part of its semiannual analysis of industrial, office and retail real estate trends in the county.
The company said 1.5 million square feet of vacant office, industrial and retail space has been leased since January. By contrast, 1.8 million square feet was absorbed in all of 1993.
The Northridge earthquake in January accounted for some of this year’s spurt in leasing, Grubb & Ellis officials said, but even so the county is ahead of last year’s pace.
Company officials said they believe the indicators show the county’s economy to be slowly improving. They predicted growth spurts in the west county, where more undeveloped parcels of land are still available.
“The leasing of industrial space in the western coastal region of the county is growing,” said Fred Ferro, a Grubb & Ellis vice president whose specialty is industrial real estate. “I believe that the message contained in these numbers shows that the economy in this county is steadily recovering.”
So far this year, the combined vacancy rate for industrial space in Camarillo, Oxnard and Ventura dropped to 9.09% from 11.9% in July, 1993, although the rate for Oxnard increased. In comparison, the combined vacancy rate for the Conejo Valley cities of Newbury Park, Thousand Oaks and Westlake Village is 10.32%. In 1993, the midyear vacancy rate was 13.4% overall.
Overall, the countywide vacancy rate in industrial space has gone down by 3.8 percentage points in the past year, to its current 8.7%.
Ferro said east Ventura County no longer offers the same flexibility in parcel size and shape as does the west county. As an example, he cited the 679,000-square-foot former Northrop Aerospace plant in Newbury Park, which has been vacant since the company pulled out in 1992. Few potential tenants need that much space, he said.
“What we’re seeing in the east county is a growing lack of alternatives,” Ferro said. “For the first time, people are looking over the (Conejo) grade to see what’s available.”
The Grubb & Ellis report also showed improvement in the county’s office building vacancy rate, dropping from 23% last July to the current 17%. Retail space vacancies have remained constant at 9% from last summer to this summer, despite the opening of more than 800,000 square feet of new shopping center space such as the new, 130,000-square-foot Oxnard Factory Outlet Mall.
William G. Keifer, a Grubb & Ellis specialist, said office tenants also are looking at the west county.
“Traditionally, the Conejo Valley has been the strongest portion of the Ventura County area (for office space),” Keifer said. “But the western portion of the county has really been helped with major office (acquisitions) by Kinko’s and GTE in Oxnard.”
But Keifer warned that while the commercial real estate economy is slowly improving, he expects no new office buildings to be constructed anywhere in the county for 16 to 18 months.
Bob Guillen, executive secretary of the Ventura County Building and Construction Trades Council, said that of his 6,000 members, about 22% are unemployed.
“We’re not seeing any major work until the (Cal State) university gets built, and that’s obviously a long way off,” Guillen said. “The situation is pretty bleak.”
Cal State officials have said it will be at least six years before the campus opens.
Mark Schniepp, director of UCSB’s Economic Forecasting Project, said it is too early to say the Ventura County economy has recovered.
“The improvement in west county vacancy rates represents one indicator that some areas of the economy in Ventura County are improving, but it’s important to remember that you shouldn’t hang your hat on just one component of the economy,” Schniepp said. “We still have seen no significant job growth or improvement in other vital areas of the economy.”
Vacancies for Ventura County industrial properties:
Area July ’93 % July ‘94% Camarillo 10.8 2.8 Conejo Valley 13.4 10.3 Moorpark/Simi 13.2 6.0 Oxnard 14.5 16.5 Ventura 10.7 8.8 Countywide 12.5 8.7
Source: Grubb & Ellis Commercial Real Estate Services
