X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

The office vacancy rate in Los Angeles increased in the first quarter. According to a market report from Savills, the office vacancy rate bumped up 50 basis points in the first quarter. While the increase is nominal, the increase shows the impact of new office product coming online. By comparison, class-A and new construction product continues to lease quickly, and the vacancy rate for that segment of the market decreased by 110 basis points.

“The delivery of additional inventory is driving the vacancy rate up,” Matt Brainard, senior managing director at Savills, tells GlobeSt.com. “This includes both speculative office development and the repositioning of older assets. The new product tends to lease more quickly than the second-generation space.”

Value-add and redeveloped office space makes up a majority of the new office product coming to the market. This space in incredibly popular, and major renovation projects are popping up throughout the city, like the Worthe Real Estate Group’s repositioning of Burbank Studios for creative office; Merlone Geier Partners and Goldstein Planting Investments’ North Hollywood West; and Hudson Pacific and Macerich’s plan to reposition the 500K-square-foot Westside Pavilion shopping center into a creative office campus, which Google has pre-leased. “Repurposing older struggling retail properties to creative office has become a prominent and highly successful trend,” says Brainard.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

More from this author

 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.