2020 Q4 Los Angeles Market Report
Even with many tenants hoping for workplace re-entry by Summer 2021, we are experiencing similar market fundamentals that were evident for most of 2020 – sustained increase in availability of commercial space due to lack of demand. The amount of relocation transactions is at its lowest point in over a decade, while we are seeing an increase in renewals. Available sublease space is at an all-time high, as companies continue to reposition themselves to weather the uncertainty of the economy.
With that said, recent news related to the expansion of online streaming services could provide a positive spark to the Los Angeles commercial real estate market. Studio space continues to be in high demand as large players like Netflix and Amazon remain active. The vaccine rollout has also created a cautious but optimistic outlook for 2021, but this will remain fluid as a return to the workplace will depend on the vaccination schedule. Only when firms are bringing people back to work will we start to understand the direction of leasing activity and the overall market.