Figures

Inland Empire Industrial Figures Q4 2025

Submarket vacancy rates converge as construction dwindles

January 9, 2026 5 Minute Read

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  • Vacancy in the IE Core rose 40 basis-points (bps) in Q4 2025 as the IE East experienced a 50-bps decrease in vacancy quarter-over-quarter to 8.5% while the IE West saw a 140-bps increase in vacancy quarter-over-quarter to 6.0%, driven by 3.6 million sq. ft. of vacant deliveries in Fontana and Ontario.
  • Amidst a season decline in leasing activity, net absorption turned negative for the second time in 2025, with 291,000 sq. ft. of negative net absorption in Q4 2025. While the IE East experienced 1.3 million sq. ft. of positive absorption, the IE West experienced 1.6 million sq. ft. of negative absorption.
  • Lease rates in the IE Core fell $0.06, or 5.5%, quarter-over-quarter to $1.03 NNN per sq. ft. per month. While the IE West saw stable lease rates for the third consecutive quarter, hovering around $1.12 NNN per sq. ft. per month, lease rates in the IE East dropped below $1.00 NNN per sq. ft. per month once again as elevated availability motivated landlords to secure the next deal.
  •  Development activity reached its lowest point in 15 years, with 2.4 million sq. ft. under construction in Q4 2025, which represents only 6.1% of peak development levels in Q2 2022 when 39.8 million sq. ft. was underway.