Boston And LA Face Off In The World Series Of CRE
Avison Young pitted Los Angeles against Boston in the World Series of commercial real estate supply. While the Red Sox can brag about MVP candidates Mookie Betts and J.D. Martinez, Los Angeles can claim victory in office and industrial inventory. LA has 210M SF of offices and 931M SF of industrial space, while Boston has 205M SF and 236M SF, respectively.
Boston wins out on office rents, with the average Class-A rent asking $41.65 compared to LA’s $40.44.
“Boston may have higher office rents, but that just means we provide more of a value-add option,” Los Angeles-based Avison Young Research Manager Artree Maharajh said. “When it comes to our industrial market, Boston is probably getting a little cold being in our shadow. Looks like the weather out there agrees.”
Los Angeles has a hefty lead in industrial inventory, and it also wins out over Boston in vacancies and rent. Industrial vacancies were at 2.8% at the end of Q3 compared to 5.5% in Boston. Rents averaged $12.36 per SF in LA against Boston’s $7.70 per SF.
Boston fans aren’t ready to throw in the towel and let LA claim CRE victory. Avison Young’s Boston team said the region’s status as the largest life science cluster in the country is almost as important as the Red Sox already having eight World Series championships under their belt compared to the Dodgers’ six.
“They may be the entertainment capital of the world, but when it comes to making groundbreaking advances in healthcare and the life sciences, Boston is certainly walking the talk a lot more than Los Angeles’ celebrities,” Avison Young Senior Research Analyst Tucker White said.