The Office Market Has Changed Hollywood

Hollywood’s population is growing substantially, and along with the growing population has come a change in demographics and an overall revitalization of the market. Entertainment company expansion have been an integral part of this growth, according to a recent survey from the Hollywood Chamber of Commerce. Both large lease deals as well as smaller media companies and young entrepreneurs have created a dynamic office market that has helped to fuel growth in other asset classes.

“Driving continued interest in Hollywood is the massive growth of key companies such as Netflix, Viacom, QuiBi and others who want to be located near these production giants,” Leron Gubler, president and CEO of the Hollywood Chamber of Commerce, tells GlobeSt.com. “Hollywood has also seen a proliferation of the co-working businesses with three WeWork locations, Neuehouse, Serendipity Labs, Sandhouse and Ignited Spaces among those with a significant footprint in Hollywood, which are launch pads for the next generation of companies. This will continue to fuel new business growth and entrepreneurship in the heart of Hollywood, attracting ever more creative and technology talent to the community.”

Development activity has gotten the most attention as helping to drive office growth by giving companies, like Netflix and Viacom, a quality office option in the market. However, the development has also helped to generate demographic shifts that also helped to drive economic activity. “The development pipeline is significant, but beyond what changes new development may drive, Hollywood now has a huge base of young entrepreneurs that are fueling economic and job growth,” adds Gubler.

The development to company to population growth pattern has created a winning formulaic cycle for the market, driving more development, leasing activity and then population growth. “Hollywood represents an investment opportunity like none other in the region. Hollywood is enjoying a booming development environment with many hotels, office campuses and apartment projects currently underway or planned throughout the district,” says Gubler. “As Los Angeles benefits from strong increases in travel and tourism, Hollywood remains a top regional destination, thus driving our increase in hospitality investment. As the entertainment industry evolves and new media continues to grow, Hollywood once again is reclaiming its role at the epicenter of this economic activity, which is manifested in the amazing growth in office and mixed-use development in Hollywood.”

This combination of growth has not only created a dynamic office market but has also created a dynamic population that is active both day and night. “The survey supports that there is demand among visitors and locals for the businesses that will populate these projects as well as interest in the lifestyle offered in Hollywood,” says Gubler. “One surprising data point from the survey is that 47% Hollywood residents use the home as a primary or secondary office. That significantly adds to the daytime population seeking services and frequenting area businesses. As the residential population grows and the daytime population of creative industry professionals grows, these will continue to drive interest and need for quality retail opportunities and amenities.”