Retail Vacancy Expected to Increase by Year's End in Riverside-San Bernardino, CA Market

ONTARIO, CA— Operating conditions in the Inland Empire will soften further in 2008 due to persistent job losses and ongoing weakness in the housing market, according to a third-quarter Retail Research Report by Marcus & Millichap, the nation’s largest real estate investment services firm.

In the coming quarters, weakness in the economy and decreased consumer spending will continue to weigh on space demand.

“The metro’s influx of new, large-scale centers will likely attract REITs, while individual buyers will still target the safety of properties located near major transportation corridors closer to the western portions of Riverside and San Bernardino counties,” says Doug McCauley, (top right photo) regional manager of the Ontario office of Marcus & Millichap.

Following are some of the most significant aspects of the Riverside-San Bernardino Retail Research Report:

· Builders are forecast to deliver 6 million square feet of new retail product to the market this year, up slightly from 5.8 million square feet in 2007.

· Vacancy is projected to end the year at 15.2 percent, an increase of 360 basis points.

· Asking rents are expected to finish 2008 at $22.24 per square foot, a nominal decline from last year.

· Effective rents will end the year at $19.69 per square foot, a 2.8 percent decline.

· Investors targeting single-tenant assets have focused on restaurants with strong national tenants. Restaurants have accounted for nearly 20 percent of all acquisitions in the last year.

For a copy of the complete Riverside-San Bernardino Retail Research Report, as well as reports on other markets nationwide, visit our website at http://www.marcusmillichap.com/.

Press Contact: Stacey Corso, Communications Department, (925) 953-1716