DTLA’s office vacancy rate jumps to close out 2017: report

Most of the neighborhood’s 1.7M sf of space under construction were available

Los Angeles /
Feb.February 15, 2018 03:30 PM
Century City Towers (Credit: Wikimedia Commons)

Los Angeles’ office market closed out 2017 with rents and vacancy rates holding steady, but Downtown fared worse, as vacancy rates there spiked, according to a new report.

DTLA stood out for its high 20.6 percent vacancy rate, according Colliers International’s fourth quarter report. The area’s 1.7 million square feet of space under construction was also more than any of the other two submarkets the broker tracked. In another worrying sign, 80 percent of that space under construction remained available.

DTLA’s sizable amount of construction was 300,000 square feet more than West L.A., the next largest. Downtown is also ground zero for concerns about future oversupply, although insiders say the risk of overbuilding is real across all of L.A. County.

The two largest Downtown projects were Waterbridge Capital’s 400,000-square-foot Broadway Trade Center at 801 South Broadway, and 757 South Alameda Street’s 425,000 square feet.

The Colliers report looked at market conditions in three submarkets: West Los Angeles, Tri-Cities, and Downtown. Citywide, average rent was $45.94 per square foot and the vacancy rate was 15.4 percent, about even from the previous quarter.

For the overall city office market, net absorption was just under 90,000 square feet from October through December. That was down from 877,100 square feet in the previous quarter, a contributing factor to the steady rents and vacancy rates.

West Los Angeles was a standout.

It was the only one to post positive absorption last year and its 13.6 percent average vacancy rate was below market. It also had the highest rent rates of any other submarket at $55.30 per square foot.

Tri-Cities had a similarly low vacancy rate, helped by Burbank’s sub-11 percent rate.


Related Articles

arrow_forward_ios
Standard Communities’ Chris Cruz and 10930 Garfield Avenue
Standard Communities pays $532K per unit for newly developed South Gate apartments
Standard Communities pays $532K per unit for newly developed South Gate apartments
7000 Romaine Street and 948 Sycamore Avenue (Google Maps)
Onni Group wants to add 14-story office in Hollywood
Onni Group wants to add 14-story office in Hollywood
Vella's Zach Vella and SWRCC's Dan Langford with 1010 Sandhill Avenue (Vella Group, Southwest Regional Council of Carpenters, LoopNet)
Carpenters union buys Carson industrial from Zach Vella
Carpenters union buys Carson industrial from Zach Vella
TCW's David Lippman with and the City National Plaza at 515 S. Flower Street (David Lippman, City National Plaza)
TCW inks largest pandemic-era office lease in DTLA
TCW inks largest pandemic-era office lease in DTLA
eBay's Jamie Iannone with 455 North Fairfax Avenue (eBay, Google Maps)
eBay goes brick and mortar on popup for sneakerheads
eBay goes brick and mortar on popup for sneakerheads
Jeff Blau with 1755 Argyle St (LinkedIn, Commercial Observer)
Related Companies to sell Argyle House in Hollywood
Related Companies to sell Argyle House in Hollywood
Frank Gehry and the Ocean Avenue Project (Getty, Ocean Avenue Project, iStock)
Frank Gehry’s long-awaited Santa Monica project takes big step forward
Frank Gehry’s long-awaited Santa Monica project takes big step forward
Duke Realty's James Connor and 14724 Proctor Avenue in City of Industry (Google Maps, Duke Realty)
Duke Realty gets another 230K sf in City of Industry
Duke Realty gets another 230K sf in City of Industry
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...