Board Members Natalie Bazarevitsch, I. Hassan, and Rusty Smith, participating in a recent Board of Directors event at Hot Rods & Handguns in Huntington Beach.
As we enter the second half of 2026, I want to reflect on the progress made during Q2 and share updates on the initiatives, market trends, and Member programs shaping the months ahead.
This quarter, AIR CRE continued advancing the new Contracts application, expanded mentorship and professional development through AIR CRE>Next, and brought Members together through education, research, leadership, and networking events. We are also seeing encouraging momentum within the Southern California industrial market, particularly in advanced manufacturing.
Advanced Manufacturing Brings New Energy to the Industrial Market
One of the most significant trends I am following is the growing demand for advanced manufacturing facilities across Southern California. These properties typically combine Class A industrial space with high-quality office environments and infrastructure designed to support sophisticated users in aerospace, automotive technology, satellites, drones, microchips, 3D printing, nuclear power, and other specialized industries.
Much of this activity is concentrated in highly desirable areas such as El Segundo, Long Beach—including the growing “Space Beach” cluster—and Torrance, with strong access to the 405 corridor, workforce housing, and nearby amenities. Advanced manufacturing properties often provide high electrical capacity, a strong corporate identity, substantial technical and office space, and infrastructure capable of supporting complex operations. Some are former large-scale manufacturing facilities being repositioned for a new generation of technology-driven users.
These facilities can command rents approximately 30% higher than traditional Class A distribution space, reflecting both their specialized improvements and the growing competition for well-located, high-image industrial environments.
Notable Q2 Advanced Manufacturing Transactions
April 2026
- Divergent Technologies – 415,312 SF in Long Beach
- Hadrian – 136,388 SF in Torrance
- Hadrian – 123,687 SF in Torrance
May 2026
- Valar Atomics – 512,490 SF in Torrance
- California Compounding – 107,333 SF in Gardena
- Ducommun Aerostructures – 307,000 SF in Carson
June 2026
- Karman Industries – 143,688 SF in Torrance
- Venturi Astrolab – 82,892 SF in Torrance
- Project Leo – 103,128 SF in Long Beach
The impact extends beyond the largest facilities. Advanced manufacturing companies also create demand from suppliers, contractors, service providers, and other related businesses seeking spaces in the 10,000, 20,000, and 50,000 sf range. Because approximately 85% of Southern California’s industrial inventory is Class B, this expanding segment is bringing new investment, activity, and vibrancy into the broader market.
“I see the market more positively today than I did 12 months ago. There are still deficiencies, but the trajectory over the next 12 to 18 months is encouraging—and advanced manufacturing is helping move the Southern California industrial market forward.”
The recovery remains uneven, but 2026 is showing more positive momentum than 2025. The continued growth of advanced manufacturing is one reason I believe the market is moving in a constructive direction.
AIR CRE Contracts: Entering the Final Stretch
Beta testing for the new AIR CRE Contracts application remains underway as we enter the final stretch of development, testing, and refinement. Our goal is to begin a selective launch toward the end of 2026. Additional communications regarding the new application, launch timing, and rollout process will be forthcoming.
AIR CRE>Next: Mentorship and Engagement
AIR CRE>Next continued providing the Class of 2026 with opportunities to learn directly from experienced industry professionals, strengthen relationships, and develop practical skills.
The Board of Directors/AIR CRE>Next Mentor Program also continued during Q2. I have two mentees this year, and our conversations have focused on deal strategy, cold calling, business development, and the steps required to move a transaction from the initial opportunity through a completed sale or lease. These ongoing discussions give emerging brokers a place to ask questions, work through real-world challenges, and benefit from the lessons learned throughout a more experienced professional’s career.
Q2 AIR CRE>Next programming included the Dedeaux Lunch & Learn, the AIR CRE>Next Day of Learning, and the all-classes Lawn Bowling event, which brought participants together for networking and friendly competition outside the traditional office environment.
Q2 Event Highlights
AIR CRE maintained an active calendar throughout the quarter, with programs supporting education, market intelligence, leadership development, and meaningful industry relationships.
Highlights included the Q1 2026 Research Insights Town Hall; the Dedeaux Lunch & Learn; AIR CRE>Next Day of Learning; Connect LA; Purchase and Sale Agreements and Lease Contracts seminars in Los Angeles; AIR CRE>Next Lawn Bowling; Research & Listings Advisory Board meetings; and Board of Directors meetings.
Thank you to everyone who participated, presented, sponsored, or helped organize these programs.
Q3 Event Schedule
Q3 programming is already underway, with one of AIR CRE’s most important annual events on the horizon: the 42nd Annual AIR CRE Golf Classic on September 29 at Industry Hills Golf Club. The Golf Classic is a signature AIR CRE event and an important opportunity for Members to connect with colleagues and industry partners. I strongly encourage everyone to attend and book early, as space is limited – Register Now
Q3 programs include:
- July 23: Town Hall: Q2 2026 Research Insights – Watch the Video & Download Reports
- August 12: In-Person Contracts Strategy Seminar: Leases – Orange County – Register Now
- August: Connect OC Partner Event — date and registration information to be announced.
- September 15, 17, 22, and 24: Research & Listings Advisory Board Meetings.
- September 29: 42nd Annual AIR CRE Golf Classic at Industry Hills Golf Club – Register Now
Members can also visit the AIR CRE Events page and follow AIR CRE on LinkedIn for registration updates, research releases, and new program announcements. AIR CRE’s online Learning Center also continues to feature Contracts seminars and other Member education resources.
In Closing
Thank you to our Board, committees, Advisory Board members, AIR CRE>Next participants, sponsors, staff, and Members for your continued engagement.
I look forward to building on this momentum throughout the remainder of 2026.
Warm regards,
Rusty Smith
President/Executive Chair, AIR CRE