Office Market
The Los Angeles County office market posted increased asking lease rates, lower vacancy and decreased net absorption and construction during the fourth quarter.
Vacancy in Los Angeles County in the fourth quarter fell 7.8% to 13.3%, versus a year earlier. Tri-Cities experienced the biggest annual change, with vacancy falling 19.8% to 8.9%. The San Fernando Valley market recorded a 19.6% decrease to 9.9%.
The lowest vacancy rate in the quarter was in San Gabriel Valley at 7% vacancy; the highest vacancy was in the South Bay submarket at 20%.
Average asking lease rates increased 2.3% to $2.15 per square foot in Los Angeles County. The largest annual increase was downtown Los Angeles, with rates up 12.3% to $2.11 per square foot. Average asking rates in the South Bay submarket fell 2.6% to $1.86 per square foot.
Net absorption in Los Angeles County remained positive in the fourth quarter, though it declined considerably compared to the first three quarters of the year.
A total of 21,415 square feet was absorbed in Los Angeles County in the fourth quarter, bringing year to date absorption to 2.4 million square feet. Annual net absorption was greatest in the Tri-Cities submarket at 751,000 square feet, followed by the West Los Angeles market with 650,000 square feet and San Fernando Valley with 548,000 square feet.
Construction activity peaked last year in the third quarter at 1.3 million square feet and dipped slightly in the fourth quarter to 1.1 million square feet.
Construction activity is limited to two submarkets: 287,723 square feet under construction in Tri-Cities and 790,000 square feet under construction in West Los Angeles.
Industrial Market
Los Angeles County experienced a spike in industrial activity during the third quarter, but settled back in the fourth quarter to levels seen during the first half of the year.
The Los Angeles industrial market tightened last year, with availability decreasing each quarter,from 7% in the first quarter to 6.1% in the fourth quarter. Vacancy also decreased during the period, from 2.6% in the first quarter to 2.2% in the second half of the year.
As a result of the tightening market, average asking rates climbed from 51 cents per square foot to 56 cents per square foot at the close of the year. Construction activity increased 24% to 9.7 million square feet in the fourth quarter.
The South Bay led the fourth quarter with 3.3 million square feet of activity for a total of 16.3 million square feet.
The World Trade Organization estimates that China’s share of the U.S. apparel market could rise from 22% to more than 50% in as little as two years because a major trade pact,the Agreement on Textiles and Clothing, which established quotas on importing goods,has just expired.
The anticipated influx of goods should create an increase in demand for warehousing and distribution space in the Los Angeles industrial market.
Data and analysis provided by CB Richard Ellis Group Inc.’s Information Management Department.Office Market
The Los Angeles County office market posted increased asking lease rates, lower vacancy and decreased net absorption and construction during the fourth quarter.
Vacancy in Los Angeles County in the fourth quarter fell 7.8% to 13.3%, versus a year earlier. Tri-Cities experienced the biggest annual change, with vacancy falling 19.8% to 8.9%. The San Fernando Valley market recorded a 19.6% decrease to 9.9%.
The lowest vacancy rate in the quarter was in San Gabriel Valley at 7% vacancy; the highest vacancy was in the South Bay submarket at 20%.
Average asking lease rates increased 2.3% to $2.15 per square foot in Los Angeles County. The largest annual increase was downtown Los Angeles, with rates up 12.3% to $2.11 per square foot. Average asking rates in the South Bay submarket fell 2.6% to $1.86 per square foot.
Net absorption in Los Angeles County remained positive in the fourth quarter, though it declined considerably compared to the first three quarters of the year.
A total of 21,415 square feet was absorbed in Los Angeles County in the fourth quarter, bringing year to date absorption to 2.4 million square feet. Annual net absorption was greatest in the Tri-Cities submarket at 751,000 square feet, followed by the West Los Angeles market with 650,000 square feet and San Fernando Valley with 548,000 square feet.
Construction activity peaked last year in the third quarter at 1.3 million square feet and dipped slightly in the fourth quarter to 1.1 million square feet.
Construction activity is limited to two submarkets: 287,723 square feet under construction in Tri-Cities and 790,000 square feet under construction in West Los Angeles.
Industrial Market
Los Angeles County experienced a spike in industrial activity during the third quarter, but settled back in the fourth quarter to levels seen during the first half of the year.
The Los Angeles industrial market tightened last year, with availability decreasing each quarter,from 7% in the first quarter to 6.1% in the fourth quarter. Vacancy also decreased during the period, from 2.6% in the first quarter to 2.2% in the second half of the year.
As a result of the tightening market, average asking rates climbed from 51 cents per square foot to 56 cents per square foot at the close of the year. Construction activity increased 24% to 9.7 million square feet in the fourth quarter.
The South Bay led the fourth quarter with 3.3 million square feet of activity for a total of 16.3 million square feet.
The World Trade Organization estimates that China’s share of the U.S. apparel market could rise from 22% to more than 50% in as little as two years because a major trade pact,the Agreement on Textiles and Clothing, which established quotas on importing goods,has just expired.
The anticipated influx of goods should create an increase in demand for warehousing and distribution space in the Los Angeles industrial market.
Data and analysis provided by CB Richard Ellis Group Inc.’s Information Management Department.
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