Downtown Los Angeles’s growth is increasingly driven by a more diverse tenant base
Coworking’s foot print has nearly quadrupled over the last five years contributing to over half-a-million square feet of new absorption in Downtown.
May 08, 2019
- Although law firms and traditional “FIRE” companies still dominate Downtown’s landscape occupying over half of the market, the co-working and creative sectors are increasingly contributing to a more diverse tenant base. Many financial services companies and law firms have been focused on right-sizing and employing new workplace standards as a way to reduce ongoing occupancy costs leading to limited demand for additional space.
- Coworking’s foot print has nearly quadrupled over the last five years contributing to over half-a-million square feet of new absorption in Downtown. WeWork controls over 300,000 square feet in the greater Downtown area and remains very bullish on the market. Over the last four months, the firm has signed 140,000 square feet of new leases. New flexible space operators to the market include CommonGrounds Workplace and Carr Workplaces, which have committed to 70,000 square feet in Downtown over the last four months.
- Creative tenants have also been significant drivers of new demand. Warner Music Group and Spotify have leased a combined total of 370,000 square feet in the Arts District. Downtown’s shift into a major residential market coupled with the addition of world class entertainment and retail venues has been key to attracting a broader tenant base and will continue to make the market much more alluring to high-growth tenants.
Source: JLL Research