Cushman & Wakefield
Climate Impact & Sustainability Data (Q3 2023, Q4-2023)
Reporting Period: Q3 2023
Environmental Metrics
ESG Focus Areas
- Diversity, Equity and Inclusion (DEI)
- Environmental, Social and Governance (ESG)
Climate Goals & Targets
Environmental Challenges
- Increased vacancy rate in the Orange County industrial market (highest since Q2 2019)
- Negative net absorption for two consecutive quarters
- Slowdown in pre-leasing of under-construction buildings
- Delivery of new, vacant inventory adding upward pressure on vacancy rate
- Decline in new leasing activity (7.0% decrease QOQ and 51.6% YOY)
- Decrease in sales activity (16.6% QOQ and 72.0% YOY)
Mitigation Strategies
- Labor agreement between ILWU and PMA ratified, bringing stability to the Ports of Los Angeles and Long Beach (potentially boosting local industrial markets)
- Some developers waiting for tenant-in-tow before breaking ground on future projects
Supply Chain Management
Climate-Related Risks & Opportunities
Reporting Period: Q4-2023
Environmental Metrics
ESG Focus Areas
- Diversity, Equity and Inclusion (DEI)
- Environmental, Social and Governance (ESG)
Climate Goals & Targets
Environmental Challenges
- Slowing demand in the OC industrial market leading to cautious developers and a deceleration in the development pipeline.
- High vacancy rate (2.7%) and negative net absorption (-752,050 sq ft) in Q4 2023.
Mitigation Strategies
- Anticipation that the Federal Reserve's less aggressive monetary policy (projected rate reductions in 2024) could stimulate earlier transaction activities in the real estate market.