​With many new taxes being proposed and considered at both the local and national level, people are beginning to ask “How will this affect my family or my business?” However, an equally important question is “How will this affect business in America in general?”  But for the purpose of this article, we are going to look at how these taxes may potentially affect the local industrial real estate market in Southern California and the decisions or considerations market participants face on a daily basis. 
 
Taxes or fees are being proposed at the local level for items as basic as road maintenance caused by heavy truck traffic, and at the national level from income to capital gains.  These taxes, coupled with more and more regulation, continually put financial pressure on owners and occupants of industrial properties as they try to provide for their employees and families.  As we talk with these groups, we hear how discouraging and frustrating the continual addition of more taxes or regulation is on both productivity and morale.

While we looked at the topic of the scarcity of industrial real estate or warehouse space in our article last month (Navigating a Tight Real Estate Market (destinoindustrial.com)), this time we will dive a little deeper into how this may effect behavior in the market place.  Buyers and Tenants are very motivated to purchase or lease property, and Sellers and Landlords are very motivated to get top dollar and all the terms in their favor.  While this dynamic clearly creates tension in negotiations, it also creates tension in relationships and interactions on the peripheral.  Buyer’s and Tenant’s can be skeptical of the advocacy of their agent on their behalf when they don’t seem to be scoring too many points in the negotiation process. Sellers and Landlords can also tend to want to over-play their cards and down-play the advice of their agent when introduced to the prospect of so many candidates for their property.  With the tensions mounting and the stakes high, one slip can significantly damage relationships.  However, as transactions successfully come together (or cancel for the right reason) and clients experience how valuable their agent representative was throughout the process, it can solidify that relationship between client and trusted advisor for a long time to come.

​When looking to lease or buy industrial property in Southern California, it is challenging to find the right solution.  Missing opportunities or not being able to find a suitable property can be  frustrating experiences.   In addition, everything seems to have multiple offers, sellers and landlords are firm on their price, choices are few, and the list goes on….  This can create pressure that can influence  significant decisions. We must take steps to deal with these challenges, but also to slow down the decision -making process in order to make informed choices.
 
There are several items to consider  in order to be best positioned to seize opportunities in today’s market.  

​    The end of the year is upon us. With all the hustle and bustle that normally takes place this time of year, even though the Covid pandemic has slowed things a little, I wanted to share a few thoughts with you.  No matter your race, sex, religion, creed, age or stage of life, this is a time of year that is for reflection on the best, for recounting of blessings, and for thinking about what lies ahead.  But even more important, it is a time for friends, family and those close to you to enjoy a meal, good conversation, and some pleasant time together; perhaps a little football too!  Maybe you are missing someone dear to you this year; be glad for the time you had with them.  Perhaps this year has been particularly challenging and difficult; be hopeful for better days ahead.  Maybe this has been a successful year for you; be thankful for the blessings in your life.  Life moves at such a fast pace, especially here in southern California, so I hope that in this holiday season you have opportunity to slow down just a little and enjoy the simpler and yet significant things in life.  There will always be time for shopping and presents, parties and events, to-do’s and checklists, but what really matters in life is relationships and sharing the time we have with those around us. I hope you have time this holiday season to enjoy the relationships in your life, even the hard ones. 

    ​As we come down the home stretch of a tumultuous year, we would like to shed some light on the industrial real estate market so that you are better prepared for 2021 decisions.  There are still many unknowns facing owners and occupants of industrial real estate in the Southern California landscape.   Our aim is to provide some local market insights on how they could affect your property or rental.  While the Governor of California recently imposed stricter guidelines to stem the spread of COVID-19, many business owners are still adjusting to all the previous requirements.  

    Last month we highlighted the significance of the upcoming California Proposition 15 vote which could dramatically effect property taxes for both owners and tenants of industrial/commercial property.  Now with less than 20 days until the national election, people are all the more curious as to the effects on real estate values and prices if the results of the national election go one way or the other.  As we are aware, supply and demand are key drivers for determining value and price. For this article, we will focus on the potential effects on demand for industrial property moving forward. 

    With less than 45 days until significant national and local voting will occur, those facing real estate decisions need to consider whether or not to wait until after these elections and votes to make a decision. Whether looking at leasing or selling as a landlord or buying or leasing as an occupant, the question is how these elections and votes will impact these transactions. What might be the impact on the value or price of industrial real estate as a result? What might be the impact on the costs or need to occupy the space itself? What might be the impact on businesses that are currently occupying space?

​During  my nearly 15 years of commercial real estate experience I’ve watched the industry evolve dramatically. As technological advances and market dynamics have changed the way we complete real estate deals, it becomes  clear that not involving a broker can actually be expensive for you..  Myriads of radio and TV ads promoting low cost real estate services have left people questioning the commission they pay real estate Agents. You may ask  ‘Why am I paying my Agent so much?’  But that is the wrong question.  Rather, the questions should be  ‘How is my Agent creating value for me?’ or ‘How is my Agent  saving me money?’ or ‘How is my Agent  making my life easier?’ or ‘How is my Agent  protecting my interests?’