Nation's Most Expensive Industrial Market Finally Tilts Toward Tenants as Orange County Vacancy Triples
After 11 consecutive quarters of rising vacancy, landlords in America's priciest warehouse market are offering concessions for the first time in years
IRVINE, Calif., Jan. 20, 2026 (GLOBE NEWSWIRE) -- Orange County industrial vacancy has tripled from a record-low 1.8% to 5.5%, creating the first tenant-favorable conditions in years in America's most expensive warehouse market, according to a new market report from WareCRE, a B2B industrial real estate marketplace.
Orange County commands the highest industrial rents in the nation, averaging $17.09 per square foot, with new leases at $19 per square foot. But after 11 consecutive quarters of tenant contraction, landlords are now offering multi-month concession packages that were unthinkable during the market's 2022 peak.
Rents have declined 6.3% year-over-year and are down roughly 10% from their 2023 highs. Properties are trading at $306 per square foot, second only to Detroit nationally, reflecting the market's enduring structural value despite the current softening of the market.
"Orange County has been the most expensive industrial market in America for years because there's simply nowhere to build," said Nick Gardiner, Head of Platform Strategy at WareCRE. "Now you have landlords offering up to a year of free rent on new leases. For businesses that have been priced out of proximity to America's busiest port complex, this is the window they've been waiting for."
Key findings from the WareCRE Orange County warehouse market report include:
-- Vacancy rose from 1.8% in Q4 2022 to 5.5% in Q3 2025, an 11-quarter climb
-- Rents down 6.3% year-over-year, approximately 10% below 2023 peak
-- Sublease space accounts for 17% of available inventory
-- New leases averaging $19/SF remain the highest in the nation
-- Small bay properties (under 100K SF) maintain a tighter 4.1% vacancy
-- Landlord concessions now include multi-month free rent and elevated tenant improvement allowances
The report notes a clear bifurcation in the market. While large-bay facilities exceeding 50,000 square feet show availability rates of over 8%, smaller infill properties remain structurally protected by land scarcity and prohibitive redevelopment costs.
"This isn't a market collapse. Orange County's 20-year vacancy average is 4.2%, well below the national average of 7.1%," Gardiner added. "What we're seeing is a normalization after an unprecedented tightening cycle. The fundamentals haven't changed. Proximity to the Ports of Los Angeles and Long Beach continues to command a premium. What's changed is bargaining power."
The full Orange County warehouse market report is available at https://warecre.com/cre-insights/market-property-insights/orange-county-warehouse-market-report-2025/
About WareCRE
WareCRE is a B2B industrial real estate marketplace connecting businesses with warehouse and industrial space across North America.
Media Contact:
Nick Gardiner
nick@warecre.com
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