LA office leasing picks up in Q2; still lags pre-pandemic
3M sf of lease deals closed, but nearly a quarter of all office space is available
Office leasing accelerated in Los Angeles in the second quarter, with a number of high-profile deals closing, but activity still lagged amid the pandemic.
The 3.1 million square feet of space leased from April through June was 55 percent more than in the first quarter, according to Commercial Observer, citing Savills data. Still, it was down 21 percent from Q1 2020 and 10 percent below the five-year quarterly average.
Another sour note: Availability reached 24.1 percent in the second quarter, higher than in Q1, according to the report. Sublease space hit an all-time high of 9.2 million square feet, up from 9 million square feet in the first quarter. Subleasing picked up during the pandemic as companies shed space in the work-from-home world or exited offices entirely.
About a million square feet leased in the second quarter was between a handful of leases, including three at Boston Properties-owned complexes.
Both Hulu and Roku leased space at Boston Properties’ Colorado Center in Santa Monica. Hulu signed a seven-year deal for 351,000 square feet, while Roku committed to 72,000 square feet. Snap Inc. added 140,000 square feet to its existing lease at Boston Properties’ Santa Monica Business Park.
Creative Artists Agency renewed its 290,000-square-foot lease at Hines’ 2000 Avenue of the Stars in Century City.
Average monthly asking rents across L.A. County declined quarter-over-quarter to $3.84 per square foot, but were still up from the same time last year by about 5.7 percent. That’s largely because of sublease space hitting the market and deliveries of new Class A space.
[CO] — Dennis Lynch