Market Snapshot: Let’s Go Shopping in LA
- Mar 11, 2015
By Alex Girda, Associate Editor
As Los Angeles sees overall improvement in all major real estate sectors, including industrial, office and multifamily, the city is recording growth in the retail market, a major component of the area’s economy. With unemployment down by the end of 2014 to a rate of 7.9 percent, a 60 basis point decrease over 2013, and temporary jobs in the retail industry bolstered by seasonal sales, Los Angeles ended 2014 on a high in retail.
In terms of space, vacancy has been dropping over the past seven quarters in Los Angeles, CBRE data shows. The last recorded average vacancy rate in Los Angeles stood at 5.3 percent at the end of 2014, with the best performing submarkets in the area being Greater Downtown, Mid-Wilshire, San Fernando Valley, South Bay, Mid Cities and West L.A. The decline in vacancy comes as a result of increasing absorption, with the rate increasing over the past three quarters.
In terms of retail space development, the city has a large amount of space expected to come online in 2015, with Q4 2014 seeing around one million square feet of space under construction in the Greater Los Angeles area. A large amount of that space will come online in downtown where The BLOC development project is currently nearing completion, while The Village in Woodland Hills will single-handedly add more than 530,000 square feet of retail space.
Chart courtesy of CBRE