A Scary Time for Tenants?
As we told you previously, it's a great time to be a landlord in LA. But what does that mean for tenants? Well, one of the speakers at Bisnow's 5th Annual Los Angeles State of the Market Thursday said the numbers are getting paper thin. DTZ regional managing principal Jonathan Larsen (snapped with Brookfield VP John Barganski) says rental rates continue to rise. telling the 500 attendees at the event there is more competition for the good space. Also, Jonathan says the M&A spree of 2014 makes it tough to even follow who owns properties sometimes.
For Brookfield's part, John says 2015 will be a year of long-term commitments from LA Tenants (John must have known about the big Yahoo deal we just told you about). He says all of the focus on the Millennial tech tenants is near-sided, as all major companies are looking for that same smart 24-year-old employee, including law firms and even financial institutions.
Sklar Kirsh founding partner Andrew Kirsh (with wife Courtney and Bisnow's most famous newborn Clementine) expects a lot of movement in the LA market, especially from foreign investors, pushing a lot of SoCal players into more attractive, and accessible, secondary markets.
Avison Young principal Christoper Cooper (with John, Jonathan and Liberty SBF MD Alex Prombaum) says tenants are looking for a much more open layout, which will force some major redevelopment plays in DTLA, where the old-school tower offices still dominate. He says Playa Vista and West LA can only handle so much, creating an opening for DTLA to pull some of those Silicon Beach tenants.