Solano County has emerged as one of Northern California's most dynamic industrial markets. Positioned at the crossroads of the Bay Area and Sacramento, with excellent freeway access and significantly lower costs than neighboring counties, Solano offers compelling opportunities for industrial users and investors alike.
Solano County Industrial Market Overview (Q4 2025)
Why Solano County?
Strategic Location: The I-80 corridor provides direct access to the Port of Oakland (45 minutes), Sacramento (40 minutes), and the broader Bay Area market. The I-680 connection links to the Tri-Valley and South Bay.
Cost Advantage: Industrial real estate in Solano County typically trades at 20-40% below comparable Alameda and Contra Costa properties.
Available Land: Unlike built-out Bay Area markets, Solano still has developable industrial land, particularly around Fairfield and Vacaville.
Labor Pool: Access to workers from both the Bay Area and Sacramento metro creates a diverse labor market.
Submarket Analysis
Fairfield
The largest and most active Solano industrial submarket, Fairfield benefits from excellent I-80/I-680 interchange access and a diverse mix of building types.
Best For: Distribution, light manufacturing, food processing.
Outlook: Positive
Vacaville
Vacaville offers a mix of established industrial parks and new development opportunities. Business-friendly approach has attracted diverse manufacturing and distribution users.
Best For: Manufacturing, biotechnology, corporate distribution.
Outlook: Stable
Suisun City
The smallest of the three primary submarkets, Suisun City offers lower price points and proximity to both Fairfield and the waterfront.
Best For: Smaller users, service businesses, value-seekers.
Outlook: Stable
Market Comparison: Solano vs. Neighboring Counties
| Metric | Solano County | Contra Costa | Alameda |
|---|---|---|---|
| Avg. Sale Price/SF | $145 | $185 | $225 |
| Avg. Lease Rate NNN | $1.05 | $1.35 | $1.65 |
| Vacancy Rate | 5.8% | 4.2% | 3.8% |
| Drive to Port of Oakland | 45 min | 25 min | 15 min |
Value Opportunity
The 20-35% discount versus Contra Costa and 35-50% discount versus Alameda creates compelling opportunities for cost-conscious users. For a 50,000 SF building, the price difference can exceed $2 million.
Investment Considerations
Cap Rates: Market cap rates currently range from 5.5-7.0% depending on tenant credit, lease term, and building quality—a 50-100 basis point premium over comparable Alameda and core Contra Costa properties.
Rent Growth: Annual rent increases of 3-4% have been typical, with some submarkets seeing 5%+ growth.
Tenant Mix: Diverse tenant base including logistics, manufacturing, food/beverage, and service companies provides stability.
2026 Outlook
Bay Area companies seeking relief from high occupancy costs will continue targeting Solano County. E-commerce infrastructure requirements are driving demand for smaller distribution facilities throughout the I-80 corridor. As interest rates potentially moderate, transaction volume should increase.
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