Los Angeles Market Update: Metro Wraps Up Best Quarter for Deliveries

In September, metro Los Angeles had 7.9 million square feet of office space under construction, representing 2.8 percent of total stock, according to CommercialEdge data. The figure is virtually unchanged from the previous month, as well as on a year-over-year basis.

Despite construction starts slowing down—no new office properties broke ground in September—the metro recorded its best quarter for deliveries. Just over 1 million square feet came online in the third quarter, more than the previous two combined. During the nine months ending in September, over 1.8 million square feet was delivered, about 100,000 square feet less than what was constructed over the same period last year.

In the CBD, GEM Realty Capital finished work on a four-story, 168,000-square-foot create office property. Located at 700 S. Main St., the building was originally constructed in 1904, with the owner taking a $95.2 million construction loan for its conversion to office, CommercialEdge data shows.

Several other buildings are currently being redeveloped in the CBD, amounting to roughly 3 million square feet of office space underway. Three of the largest under construction office properties in Southern California are in Los Angeles.

Continuum Partners wrapped up construction work on Produce LA in East Los Angeles. The five-story, 122,612-square-foot building offers floorplates averaging 31,300 square feet, 13- to 14-foot ceiling heights and a 4,200-square-foot rooftop deck.

With 5.7 million square feet slated for a 2021 completion, Los Angeles seems poised to outperform last year’s activity—2.3 million square feet of new office space was delivered in 2020. However, multiple projects experienced pandemic-induced delays. Besides the CBD, submarkets with substantial construction activity include Burbank (942,250 square feet underway), West Los Angeles (1.4 million square feet) and Culver City (900,000 square feet).

CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here.