Downtown Los Angeles (DTLA) has one of the greatest urban rejuvenation stories. DTLA lost its prominence after the Second World War for a variety of reasons that included LA’s sprawling growth. By the 1970s, DTLA’s historic buildings were largely underused and in disrepair. Thanks to major policy initiatives concurrent with construction of the Staples Center, DTLA has become a vibrant urban neighborhood to live and work in.
Market
The Downtown LA creative office market is slowly improving. Vacancy in the creative office type showed a reduction of 2% between Q1 and Q2 2019, but remains in the double-digits (13.6%). DTLA saw an eye popping 512,000 SF in net absorption—the highest in years. This absorption was boosted in part by Ghost Management Group’s (formerly Weedmaps Media Inc), 115,000 SF lease at ROW DTLA in the Arts District, in addition to the 100,00+ SF lease by TubeScience at 655 S Santa Fe. Coworking space also helped driving down vacancy with Neuehouse’s first space in DTLA at the Bradbury building, which encompasses more than 22,000 SF, and the 5th Wework location in Downtown at the Maxwell Building with approximately 40,000 SF leased. Although leasing activity has been the best we’ve seen in years, creative office average asking rates seem to have reached a peak at $3.40/SF last year. For the past year we’ve seen small reductions each quarter reaching $3.04/SF this quarter.
Market
The Downtown LA creative office market is slowly improving. Vacancy in the creative office type showed a reduction of 2% between Q1 and Q2 2019, but remains in the double-digits (13.6%). DTLA saw an eye popping 512,000 SF in net absorption—the highest in years. This absorption was boosted in part by Ghost Management Group’s (formerly Weedmaps Media Inc), 115,000 SF lease at ROW DTLA in the Arts District, in addition to the 100,00+ SF lease by TubeScience at 655 S Santa Fe. Coworking space also helped driving down vacancy with Neuehouse’s first space in DTLA at the Bradbury building, which encompasses more than 22,000 SF, and the 5th Wework location in Downtown at the Maxwell Building with approximately 40,000 SF leased. Although leasing activity has been the best we’ve seen in years, creative office average asking rates seem to have reached a peak at $3.40/SF last year. For the past year we’ve seen small reductions each quarter reaching $3.04/SF this quarter.
