Los Angeles Office Market Report
Expected Improvement in Post-Restriction Office Demand Tested by Deliveries and Record Vacancy
County on pace for protracted recovery. Ongoing vaccination efforts and the rollback of coronavirus restrictions have Los Angeles-based companies planning their return to in-person operations, yet the metro’s office market is likely to remain challenged in 2021. Amid a span of business shutdowns that stretched into the early part of this year many tenants reduced their office footprints as leases rolled over. Others placed unused space on the sublease market. Together these decisions elevated vacancy to 17.5 percent. While leasing activity improved in the first quarter of this year, an overwhelming number of agreements were for less than 10,000 square feet. As additional businesses hash out their future space needs, sizable speculative properties and larger recently vacated spaces may struggle to secure tenants in the near term, placing upward pressure on availability.