The industrial market in the Inland Empire is cooling down. About 12% of space is available, vacancies increased to 7.2% in Q4 2025, and average rents have stabilized at $1.00 PSF NNN.
MARKET DRIVERS
As 2025 draws to a close, the Inland Empire industrial market continues to recalibrate. Major distributors and e-commerce companies still favor contemporary, high-clear big-box facilities near ports and rail connections, despite significant move-outs from mid-aged buildings. Leasing activity remained steady throughout 2025 due to new supply and tenant relocations driven by large modern logistics requirements, along with a few midsize and smaller deals.
Subleases account for roughly 20% of the available space, which is keeping rents down and prompting incentives such as improvement allowances and rent-free periods.
The availability rate increased to 11.9%, and the vacancy rate rose to 7.2%, reflecting additional space from recently completed buildings and new lease listings. Several significant leasing deals occurred over the past year, including Maersk (1.0M SF) in Hesperia, iDC Logistics
(844K SF) in San Bernardino, and other deals ranging from 600K to 850K SF—indicating ongoing tenant interest, though it remains somewhat selective.
FORWARD OUTLOOK
In 2026, underlying market trends are expected to stabilize and then steadily improve, as new construction completions remain below historical norms while absorption experiences a substantial increase. With upcoming building deliveries, vacancy rates may see a short-term rise, followed by a decline as more space is filled—particularly in large-scale logistics facilities near ports, which are difficult to replicate. This trend’s impact should diminish by the end of 2026, driven by the occupancy of recently signed large leases and a slowdown in new construction.
4Q 2025 Inland Empire Industrial Market: Key Data Points
Explore our full Inland Empire industrial market review for deeper insights into leasing trends, sale activity, and submarket performance.
- Vacancy Rate Climbs: Direct vacancy reached 7.2%, up from 6.2% year-over-year.
- Availability Rate Increases: Total availability rose to 12.7%, a 14% YOY increase.
- Average Asking Rent Holds: Asking rents stabilized at $1.00 PSF/Mo NNN, down 10.7% YOY.
- Leasing Activity Slows: Total lease transactions were 5.6M SF, a 49% decline YOY.
- Net Absorption Positive: Direct net absorption totaled 1.7M SF, reversing negative absorption in Q3.
- New Deliveries: 883K SF of new industrial space delivered in Q4 2025.
Click here to subscribe to Kidder Mathews market research.