Vacancy in the Santa Barbara industrial market is 5.5% and has increased 2.8% over the past 12 months. Meanwhile, the national average increased by 1.4%. During this period, there has been 530,000 SF of negative absorption, and 14,000 SF has been delivered.
Within this market, logistics space is by far the largest subtype with 11.5 million SF in this category, followed by 4.2 million SF of flex space and 4.0 million SF of specialized space. At a combined total of 19.7 million SF, Santa Barbara is smaller than the average industrial market.
Rents are around $18.00/SF, which is a 3.2% increase from where they were a year ago. In the past three years, rents have increased a cumulative 17.3%. Furthermore, this is a structurally expensive market, with rents significantly higher than the national average of $11.80/SF.
About 30,000 SF is under construction, representing a minor 0.2% expansion of inventory. Moreover, the total market is 130,000 SF larger than it was three years ago.
There have been 29 sales in the past year. Sales have averaged $69/SF, and the estimated value for the market as a whole is $231/SF. The most frequent of these transactions have been those of logistics space, with 20 sales. This tracks with the overall mix in the market, as the subtype is the largest in Santa Barbara.
Over the past three years, there have been 127 sales, which have traded for approximately $330 million. The market cap rate for Santa Barbara is 6.3%, moderately above its trailing three-year average of 5.8%.
Although both employment and population have grown in the past year, employment growth has outpaced population growth. The number of jobs has increased 2.5% in the past year, while the population has grown by 0.3%.