Rents for industrial/warehouse buildings have increased to $.85-$.90/sf gross on a number of properties in Santa Rosa. This is 15%-20% increase from leases that were done 12-18 months ago. Currently, there are over 750,000sf of industrial requirements circling build-to-suit opportunities due to the lack of inventory of properties 20,000sf and above. Most of those building that are available in this size range are obsolete for many users without the required clear heights, dock loading doors and night air cooling systems. Most requirements are currently related to food, wine and beer manufacturing. Build-to-suit rents are likely to be in the $.85-$1.00psf range NNN depending on quality and location.
Quality industrial space in Petaluma has become increasingly scarce. Food producers especially are looking at Petaluma to expand, some of which are currently negotiating with developers to build their specific requirements. Petaluma has become a food and beverage center in Sonoma County, and demand is increasing. Petaluma is an excellent hub location if you want to distribute your product and maintain a prominent North Bay presents.
Small industrial tenants struggle to find a place for business. After the great recession as businesses get closer to normal, small industrial uses such as contractors, production, and warehouse tenants are having a problem finding space under 5,000 sf and commercial agents find it challenging to find it.