According to the Winter 2025 Allen Matkins/UCLA Anderson Forecast California Commercial Real Estate Survey, data centers and digital infrastructure have taken over as the primary catalyst for industrial development, surpassing e-commerce. In fact, in the latest survey, 38% of respondents identified these sectors as leading drivers of new projects compared to only 17% in the previous survey.
This shift has resulted in a strong outlook for the industrial sector overall, particularly in Northern California where half of respondents anticipate multiple new projects within the next year. Southern California is also experiencing this optimism with 54% expecting an increase in new developments.
The office market is also seeing changes due to advancements in AI and digital infrastructure. The demand for AI talent has led to increased leasing activity and a decrease in office vacancies seen since early 2019 specifically within San Francisco where there has been a significant growth (59%)in AI job opportunities since January 2024.
Spencer Kallick, partner at Allen Matkins states that “the growing use of cloud computing,machine learning,and artificial intelligence are having an impact on commercial real estate.” As technology continues to shape this industry,researchers are closely examining which markets show potential growth across various sectors such as office space ,industrial facilities ,retail spaces,and multifamily properties .
Don’t miss out on Michael Brennan’s Lifetime Achievement Award presentation during Connect Industrial Midwest event taking place on March5th at Joe’s Live,Rosemont IL . Register today!
