The make-up of commercial real estate (CRE) has gone through significant changes over the past couple of years throughout the U.S. and worldwide. Even CRE experts don’t know yet how many of those changes will be permanent – particularly when it comes to the need for office space.
Many businesses have downsized their office space as more employees have found that they can continue to work effectively from home. What does that mean for those who are considering investing in office properties here in Los Angeles in 2022?
The vacancy rate is among the lowest in the country
In January, the vacancy in metro LA was 13.5%. That’s only 10 basis points below what it was in January 2021 even though several million more square feet were added last year. LA’s vacancy rate for offices is below the national average. By comparison, San Francisco had just under a 16% vacancy rate. Manhattan had the lowest office vacancy rate in the country at 12.8%
Optimism about the future for office space in the commercial business district (CBD) of LA is evidenced by the redevelopment of California Market Center (CMC), which will bring 1.5 million additional square feet of office space to the area.
Adidas will occupy the uppermost two floors as the anchor tenant at CMC. The mixed-use space is home to retailers, hotels, offices, showrooms, restaurants and more.
Investing in and developing commercial space in the Los Angeles area is always a challenging and ever-evolving endeavor. Having experienced legal guidance every step of the way can help prevent unnecessary problems and help you deal with obstacles as they occur.