LaSalle. Carver points to recent statistics
that suggest port traffic is rising “because
corporate America is building up its
inventories.” However, he notes that it is
too early to tell whether the inventory will
turn over at a faster pace. “Today, we are
seeing much more of a balance between
inbound and outbound traffic than in
years past.
“When port traffic volumes remain
steady, inventory will turn over at a faster
pace,” Carver continues. “Greater inven-
Forum Local
continued from page 20
tory turnover will be a signal of renewed
consumer confidence.” He adds that,
since February, there has been an uptick
in traffic, but the industry is just waiting
to see if it continues through the tradi-
tional peak holiday season. “We are cur-
rently not at previous peak levels, but on
the road to that volume.”
Economist Christopher Thornberg,
founding principal of Beacon Economics
in Los Angeles, points out that in terms of
logistics and California’s recovery, there
are a number of important issues to con-
sider. Thornberg agrees that trade has a
“Increased
port activity
could indicate
an increase in
inventories
and be a
prelude to increased
consumer demand.”
JOHN MAGNESS
Hillwood Investment Properties
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Dwyer-Curlett & Co. is a partner of Q10 Capital, the 6th largest intermediary in the placement of
commercial real estate capital, with 26 offices nationwide.
big influence on demand for industrial
space—particularly in the transport cor-
ridors. He also points out that it isn’t just
seaports, but airports, too, tend to cluster
warehouses around them. “Trade num-
bers are showing signs of improvement,”
he says. “Both imports and exports have
bounced since last year.”
However, Thornberg also warns that
this doesn’t mean that industrial space
will be bouncing back in the same way.
“Both imports and exports continue to be
below their previous peaks,” he says.
“Moreover, the gross amount of industrial
space continued to grow after the onset
of the recession—a function of the lag
between the decision to build and project
completion.” As such, he says, “trade
flows would have to rise above their previ-
ous peak to absorb all that space.”
Lastly, Thornberg says that the vast
majority of the logistics sector—and a
large portion of the industrial space mar-
ket—has nothing to do with trade. He
explains that most of the logistics jobs are
not driven by trade but by the local econ-
omy. “Until the economy gets up and run-
ning, logistics will be similarly weak.”
John Magness, senior vice president
in the San Bernardino, CA office of
Hillwood Investment Properties, says
that an uptick in port traffic is obviously
good news because “increased port activ-
ity could indicate an increase in invento-
ries and be a prelude to increased con-
sumer demand.” However, like
Thornberg, he says, “Without new jobs
in the industrial sector or the housing
sector, the supporting industries will not
require office space.”
And although the port numbers are
promising, Magness points out that there
is so much vacancy in the Inland Empire,
for example, that there still might not be
