Sacramento Industrial Market Report

Lone submarket resisting vacancy pressure. Sacramento’s industrial market shifted during the second half of last year, noting two straight quarters of negative net absorption for the first time since 2010. Easing demand resulted in vacancy rising by at least 50 basis points year-over-year in four of the five submarkets that comprise the metro, with Placer County the sole outlier. Here, local vacancy fell to just 2.6 percent entering 2024. This county’s average asking rent also rose last year by the fastest pace of any major submarket with at least 15 million square feet of inventory west of the Mississippi. Move-ins planned here for 2024 include a variety of construction-related firms, such as roofing and home appliance suppliers. This aligns with the residential building boom taking place in the Roseville-Rocklin corridor and further east along Interstate 80. Roseville-Rocklin’s apartment supply grew by the fastest pace in more than two decades last year, and nearly as many units will open in 2024. This is boosting industrial leasing here, but the two largest areas by inventory — Sacramento and Yolo counties — each had vacancy lifts of 200-plus basis points last year, stunting market performance.