{"id":1004565479,"date":"2022-02-08T06:59:41","date_gmt":"2022-02-08T14:59:41","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004565479"},"modified":"2022-12-08T19:09:02","modified_gmt":"2022-12-09T03:09:02","slug":"los-angeles-market-update-office-development-revitalized-in-2021-despite-shifting-trends","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/los-angeles-market-update-office-development-revitalized-in-2021-despite-shifting-trends\/","title":{"rendered":"Los Angeles Market Update: Office Development Rebounds Amid Shifting Trends"},"content":{"rendered":"

\"\"<\/a>Office construction in Los Angeles rebounded to a healthy pace, despite continued uncertainty in the sector. As of December, the metro had 6.7 million square feet of office space under construction, according to CommercialEdge<\/strong>. The amount represents 2.3 percent of total stock, on par with the national rate.<\/p>\n

Although the pipeline shrunk by 26.6 percent year-over-year, multiple large projects that experienced delays during the crisis contributed to a previously inflated figure: 9.1 million square feet were underway in December 2020.<\/p>\n

Last year, Los Angeles saw the addition of 3 million square feet of new office space, exceeding the previous five-year average of 2.5 million square feet. Completions peaked in the third quarter, when more than 1 million square feet came online.<\/p>\n

In the CBD, mixed-use buildings and large redevelopments comprise a significant portion of the pipeline. The largest of these is <\/span>Waterbridge Capital<\/strong>\u2019s 969,500-square-foot property, planned to become new office space at 801 S. Broadway. The historic 1.1 million-square-foot asset has been under construction for several years, with the owners reportedly placing the mixed-use project up for sale, according to <\/span>Commercial Observer.<\/em><\/p>\n

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California Market Center’s new office buildings. Photo by Javier Gullien<\/p><\/div>\n

Another similar development is Brookfield Properties<\/strong>\u2019 reimagining of California Market Center<\/a>, estimated to cost more than $250 million. The 1.8 million-square-foot property was under development for more than three years, with the first of its three buildings coming online in 2020. It offers a variety of spaces meant to attract tech, media, and entertainment tenants. Of the total, 1.5 million square feet is office space, 150,000 square feet is retail, while the rest is intended for showrooms, outdoor spaces and event areas. Adidas<\/strong> became an anchor tenant of the office space in January this year.<\/p>\n

Los Angeles\u2019 future office development offers a somewhat different picture. Another 9.5 million square feet are in the planning stages, with the majority being situated in suburban submarkets. Last year, construction activity in suburban regions was mostly driven by the metro\u2019s creative industries, as well as the nationwide trend to shift towards a more hybrid workforce<\/a>.<\/p>\n

Demand for film and media production<\/a> space saw the addition of several large properties to the pipeline. In October, King Street Capital Management<\/strong> and Alberta Investment Management Corp<\/strong>. formed a joint venture, committing more than $500 million for its first projects<\/a>, set to target film and content creation hubs.<\/p>\n

In Culver City, Hackman Capital Partners<\/strong> is currently developing the Culver Studios, a 14-acre property which will see the addition of more stages and office space at the historic studio. In total, plans call for 628,750 square feet of office space and 720,000 square feet of studios.<\/p>\n

Another such project is Worthe Real Estate<\/strong>\u2019s Second Century development in Burbank, comprising two new buildings under construction for Warner Bros<\/strong>. The 800,000-square-foot asset is designed by Frank Gehry and is slated to come online in 2023, upon Warner Bros.\u2019 100th anniversary.<\/p>\n

Other significant office projects under construction include:<\/p>\n