Port of LA forecasts a 7% drop in box volume, and IE warehouses feel it on a lag

Citrus Belt Review: The Los Angeles Board of Harbor Commissioners approved the forecast alongside a $3.4 billion budget this month, citing trade-policy volatility and tariffs that have pushed importers toward routes through Mexico and Canada. China's share of containerized imports through Los Angeles has fallen to roughly 40% in 2026, down from 53.4% a year earlier. For a region whose warehouses exist to absorb what comes off those ships, a thinner pipeline at the dock is the leading indicator that matters more than the spot freight rates or fuel surcharges national freight desks track most closely.

What the forecast meets on arrival is a market already carrying slack. Cushman & Wakefield put IE industrial vacancy at 8.5% in the first quarter, up 50 basis points in three months and more than double the market's 10-year average of 4.0%. CBRE recorded IE Core vacancy at 7.8%, driven by big-box tenants vacating space above 500,000 square feet. The complicating fact, and the reason this isn't a simple demand-collapse story: leasing was strong in the same quarter — CBRE counted 13.6 million square feet of new deals, up 40% from the prior quarter. Tenants are still signing. But a port forecasting fewer boxes is not signaling that the move-outs are about to stop, and asking rents in the IE Core, at $1.09 NNN, have not yet broken. The next two quarters of absorption tell whether this is a pause or a turn.