New Study on Industrial Land Supply Vindicates BIA Bay Area

New research presented to ABAG's Regional Planning Committee shows that the Bay Area region has neither a current nor projected shortage of land zoned for industrial uses. The notion that the Bay Area suffers from an industrial land shortage, and therefore "conversion" of industrially zoned land to housing or mixed use should be discouraged, is regularly put forth in local planning discussions. Proponents of this view have sought to embed industrial land preservation policies at the regional agency level as part of Plan Bay Area. Thus far, BIA Bay Area has successfully led efforts to prevent this, arguing that there is no empirical data supporting the industrial land shortage narrative, and that local industrial land preservation policies are often misguided, acting as a significant constraint on the region's ability to meet its housing needs.

A recent study by UC Berkeley's Transportation Center, funded by Caltrans, confirms that the Bay Area has ample industrial land now and a projected adequate supply through 2040--even assuming rates of industrial land conversion that are much higher than those actually experienced in recent years. Also, while the study indicates that certain sub regions may experience a shortage in 2040, those projections too assume rates of conversion that are orders of magnitude greater than historical rates of conversion. Among the key findings contained in the draft Executive Summary:
• The current region wide vacancy rate for industrial land is 7%.
• Outside of San Francisco, much of the Bay Area's industrial land is occupied at very low densities.
• Warehouse use represents 50% of the region's leased industrial land.
• The researchers' initial fieldwork estimated that 10% of industrial land has been converted since 2010. However, comprehensive assessor's data shows that only 1% has been converted over the entire 6-year period.
• Even assuming conversion of 17% of industrial land from 2011 through 2040 (which is much higher than the experienced 1% from 2010 through 2016), the region will have an adequate supply of industrial land.
• While a projected shortage in some counties (San Francisco, Santa Clara, San Mateo, Alameda) is shown, this potential future shortage occurs only if one assumes this highly accelerated rate of conversion of existing industrial land.
• There has been little encroachment of new housing on exclusive industrial land: in Oakland and San Jose only about 1-3% of new housing units have been built on industrial land.
• The researchers identify factors to consider in determining whether specific industrial land should be retained or converted to residential or mixed use (Table 2 of the study) A copy of the Executive Summary draft is here [attached].