Greater Los Angeles San Gabriel Valley Office Market Overview
The San Gabriel Valley office market experienced further compression in the second quarter of 2017, with vacancy dropping to 13.8% from 14.0% the previous quarter. Upward pressure on rents did not materialize, however, as the overall average asking rent remained at $2.22 per square foot (PSF) Full Service Gross (FSG). This was the second consecutive instance rents did not rise since second quarter of 2013.
The most notable sale for the quarter was LA Corporate Center in Monterey Park trading to Omninet Capital for $81.0M ($205 PSF).
The 4 building campus was the latest in Blackstone’s continued asset disposition, which constitutes 23 properties in Los Angeles over the past 2 years.
Leasing activity for the quarter recorded at 222,300 SF. City of Hope signed for just under 80,000 SF at 4910 Rivergrade Rd. in Irwindale, while internet hardware developer Mellanox renewed
and expanded to 14,700 SF at the aforementioned LA Corporate Center. Leasing activity rose by 25.2% year-over-year.
The San Gabriel Valley pipeline remains relatively static, with only 32,000 SF due to deliver within the year.
Los Angeles County non-farm unemployment in May 2017 declined to 4.4% from 5.3%, a 17.0% decrease year-over-year. Over the past 12 months, Los Angeles County gained 55,700 jobs for an increase of 1.3%. educational and health services (+25,500), professional and business services (+15,900) and government (+7,500) posted the highest gains.