Browse Tag: title 24

Exec: Renters Avoiding Buildout Costs In California Office Market

Downtown LA's office skyscrapers. Including th...
Downtown LA’s office skyscrapers. Including the Wells Fargo Center and California Plaza Towers. (Photo credit: Wikipedia)

The imposition of energy efficiency standards for new and altered commercial buildings in California is helping to stoke the fires of a hot landlord’s market in offices, says one Los Angeles-based property exec.

At issue is the 1978 California law called Title 24, which aims to decrease the environmental impact of buildings. The law’s requirements impose costs on buildout and tenant improvement plans to the point that, according to Jim Proel, EVP of PM Realty Group, office tenants facing sub-10% vacancy rates are increasingly going the other way — toward longer lease terms with somewhat stiffer annual rent escalations than would be popular in a different market.

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