Westside gives boost to LA’s office market in Q3

Tech and co-working tenants were the major drivers of activity

The West L.A. skyline
The West L.A. skyline

Strong leasing activity in the Westside kept the overall Los Angeles office market steady in the third quarter.

The vacancy rate in the Westside reached its lowest point since the end of 2016, according to a CBRE market report cited in the L.A. Times. It was the 10th straight quarter that office landlords in the Westside leased more space than hit the market, according to the report. Average asking rents on the Westside clocked in at $5.14 a foot per month, well over the county average of about $3.71 a foot.

WeWork and biopharmaceutical company Kite Pharma inked two of the biggest leases in the submarket in the third quarter. The troubled co-working company leased 67,000 square feet in West L.A. and Kite Pharma took 87,000 square feet in Santa Monica.

Both county-wide average rent and county-wide 14.3 percent vacancy was unchanged from a year ago. The third quarter passed without a massive lease signing, but tech and co-working tenants continued to gobble up mid-sized leases, according to CBRE.

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The Tri-Cities market — Burbank, Pasadena, and Glendale — had a particularly good quarter, scooping up entertainment industry firms priced out of Hollywood.

Netflix remained the dominant leasing player in Hollywood, where nearly 80 percent of space being built is already leased. The company has leased or committed to taking 1.6 million square feet of office space in L.A., much of it in Hollywood.

Meanwhile, Downtown L.A. remained the weakest submarket with a vacancy rate near 19 percent. [LAT]Dennis Lynch