Diminishing occupancy. Bold new use of space. Landlords with a habit of raising rents. LA’s central business district is on pace to become one of the most interesting arenas of all SoCal commercial real estate markets. And that, explains Tom McDonald, JLL’s Executive Vice President, spells opportunity for law firm tenants looking to optimize their real estate strategy.
In the first installment of a three-part series on law firm real estate trends, McDonald predicts stagnant demand—and fresh opportunity—coming soon to the Central Business District, as more LA law firms pursue innovative new ways of optimizing their use of space. For example, he explains that of the 140 full floors now occupied by law firms, 83 have a use metric in excess of 1,000 square feet per attorney. All that unused square footage adds up to a staggering 29 floors of surplus space that, despite being unnecessary, must still be paid for.
To reduce that “phantom space,” area firms are finding value in tactics like reducing average office sizes from 650 to 550 feet, and converting to digital filing and libraries—and as a result, adding to vacancies even as they remain active in the area.
How can tenants begin to take advantage of this changing market?
Start early, advises McDonald. The first step is to sit down and plot an aggressive real estate strategy, then be patient as you see it through.
For more information, contact Tom McDonald.