Los Angeles Office Market Reports | Avison Young US - Los Angeles
Los Angeles office market report
The Covid-19 pandemic has had lingering effects on the Los Angeles office market. Occupiers have faced challenges in implementing a return-to-office strategy, in which some occupiers have chosen to adopt a hybrid or fully remote work schedule for their employees. Moreover, high interest rates and owner pessimism over the future of the office market has continued to drive sales activities downward. Despite the current state of the office market, many landlords have offered generous concession packages in lieu of decreasing rents.
2023 has seen 3.1 million square feet of new office construction underway in Los Angeles, with 701,562 square feet delivered.
There has been 726,587 square feet of negative absorption so far in 2023, trending to be the best absorption rates in Los Angeles since 2019.
Direct Asking Rent
The Los Angeles office market concluded the second quarter with average asking rents at $43.58/sf, which is down only 0.8% from the year prior.
There is currently 69.7 million square feet of available space in Los Angeles, representing 23.2% of the office market. This continues the upward trend of availability since the pandemic. Of the total availability, 11 million square feet is available for sublease.
Total vacancy this quarter registered at 18.9%, with 16.7% direct and 2.2% sublet.
Total sales volume in Q2 2023 came in at $968 million, signaling a decrease from previous years.
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