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Rent gap between traditional and creative office widens

• The rent gap between creative and conventional office has accelerated since 2010. Overall average office rent has grown by 30 percent while rent for creative product grew by 81 percent over the last seven years.  Surprisingly,  Los Angeles has a modest supply of creative office accounting for only 23.2 million square feet, or 12 percent of the total inventory.

• Tech and particularly entertainment and media, have been resolute in their choice for creative product . Over the last 24 months, Warner Music Group, Netflix and Viacom have leased over 1.2 million square feet as single-user tenants in creative-designed assets.  Additional demand should remain robust not only on the Westside, South Bay and Downtown where the product is concentrated, but also expand more broadly throughout the LA basin.  Additional supply may be needed to accommodate increasing tech migration from northern California seeking alignment with LA’s entertainment and media industry.​

Source: JLL Research

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