Los Angeles sales volume sustained by solid market fundamentals
Office trades totaled $4.6 billion during the first six months, up from $4.5 billion recorded during the first half of last year
June 26, 2019
- Office trades totaled $4.6 billion during the first six months, up from $4.5 billion recorded during the first half of last year highlighting investors’ continued interest in the Los Angeles market. Rolling four-quarter volume also trended up. Institutional and private investors accounted for 24 and 54 percent and percent of the buyer pool respectively. Many of the larger sales occurred in submarkets with a concentration of technology, entertainment and media companies, where leasing activity has been robust. Some of the notable transactions that have helped drive volume include the Wilshire Courtyard, C3, Ford Factory and Television City, which combined totaled approximately $1.8 billion.
- Los Angeles’s solid office fundamentals are supported by limited development activity relative to other West Coast markets with the current construction pipeline not exceeding more than 1.8 percent of total inventory. The metro continues to attract tech giants from Northern California seeking closer alignment with media and entertainment as well as access to a deep talent pool. With an output of over one trillion annually, the Los Angeles’s economy is the largest on the West Coast but it is also one of the most diversified limiting the risk from a single sector. Given these factors, investor interest should continue to drive healthy office sales volumes through 2019.
Source: JLL Research, Real Capital Analytics