Google Grows in West Los Angeles As Rents Rise
- The average asking monthly rent for West Los Angeles rebounded from a momentary decrease last quarter to $4.82 per square foot (PSF) full service gross (FSG).
- Demand, while positive, decreased from the end of 2018, recording 145,900 square feet.
- No new projects delivered from the under-construction pipeline. A total of 15 buildings remain in the pipeline.
- Investment activity maintained momentum with five properties trading, highlighted by Hackman Capital's acquisition of the CBS Studio Lot.
- Leasing activity recorded 1,798,900 square feet, marking five consecutive quarters of velocity exceeding 1.1 million square feet. Tech giant Google was the headliner, signing for 584,000 square feet in West Los Angeles.
Vacancy in the West L.A. market dropped minimally by 20 basis points from the start of the year, driven by absorption gains in Century City, Culver City and West Hollywood. In a return to form, rental growth again exceeded 4%. While last quarter was defined by multiple large leases between new media companies, Google made a major splash this quarter, pre-leasing the entirety of the creative office conversion formerly known as Westside Pavilion.
The West L.A. market began 2019 with some momentum. Demand remained positive for the quarter, but was essentially flat given the size of the West Los Angeles market. Rent rebounded after a momentary dip last quarter. As 2019 begins, several companies such as Hulu remained poised to snap up large blocks of space as others, like Amazon, Apple and Facebook, have already staked their claims in Silicon Beach.