COMMERCIAL VACANCY RATES DOWN.

Byline: Deborah Sullivan Daily News Staff Writer

Vacancy rates for office and industrial space in Ventura County are down, while retail vacancies have remained stable and low, particularly in the east county, a quarterly report released Wednesday shows.

Although the industrial sector appears to be the most active area, CB Commercial Real Estate Group officials described the overall market in glowing terms.

``Robust, vibrant, dynamic,'' was the assessment of Chuck Engel, a vice president with CB Commercial. ``We're optimistic. Not guardedly optimistic like we were three years ago.''

The growth of industrial, office and retail business may put pressure on the residential market, causing home prices to rise and spurring demand for new housing, officials said.

``All of a sudden in the past couple of months, the inventory of houses is not as great,'' said Kay Runnion, executive officer of the Conejo Valley Association of Realtors. ``Houses are moving fast. It's reminiscent of the market back in the '80s, when it was a seller's market.'' And industrial real estate surged from July through September, along with an upswing in the economy, said Senior Vice President Bob Flink.

``The vacancy factor for industrial activity is sitting at about 9 percent for the county,'' Flink said.

Industrial vacancy rates for the east county are at 10.8 percent, while west county rates are 7.8 percent. That 9 percent itself is a historically low rate, Pelton said. Even during the 1980s boom, the rate remained around 10 percent.

But there's more: The 9 percent average is artificially high, spiked by several large, vacant industrial spaces of 500,000 square feet or more that have not met the needs of new industrial users who want smaller facilities.

Subtract those buildings, and the vacancy rate drops to around 6 percent countywide, Flink said.

``The thing that we're suffering from now is lack of inventory,'' he said. ``Our supply is not building to meet the demand.''

And the demand is growing, Pelton said.

Fed by Los Angeles and Santa Barbara counties, Ventura County is seeing an influx of new business attracted by the competitive rates on industrial space - about $8 to $10 a square foot in the Conejo Valley and $4 to $6 a square foot in the Oxnard Plain, he said.

Rates for both places are lower than those for other outlying areas of metropolitan Los Angeles, such as Valencia, with rates at $9 to $10 per square foot, Pelton said.

Because the demand has actually outstripped the supply of space, construction of industrial buildings has picked up, Flink said.

``It's going to be helpful for our overall economy, because not only will we see jobs created . . . but we'll see more industry grow,'' Flink said.

Vacancy rates for office space are down from 15.5 percent three years ago to 13.2 percent for the third quarter of this year.

And vacancy rates for the east valley office market look even better - 8.4 percent this quarter, compared to 14.4 percent three years ago.

Fueling that market is a jump in office purchases by real estate investment trusts, which buy real estate and sell shares in those holdings on the stock market, Engel said.

Meanwhile, the retail market has held steady for the past 10 quarters, said Reed Henkelman, also a vice president with CB Commercial.

``When we look at the retail market, it's pretty much bouncing along, very stable and healthy,'' Henkelman said.

Vacancies in the retail market are down slightly - from 7.1 percent three years ago to 6.7 percent this quarter. In the east county, retail vacancies have hovered between 3.7 percent and 5.2 percent over the past year and a half, coming in at a midrange of 4.9 percent this quarter.

West county vacancy rates have remained between 7.6 percent and 8.6 percent.