Los Angeles area office rents cheap by international standards
Rent is always one of the biggest expenses for white-collar businesses in Southern California, but office space here is an absolute bargain compared with most global financial centers.
In fact, no U.S. city cracked the top 10 in an annual survey of the world’s most expensive office markets
released Wednesday by real estate brokerage CB Richard Ellis. London’s West End kept its crown as the priciest neighborhood of all. Office space there goes for $183 a square foot per year.
Hong Kong’s central business district, where annual rents are $153 a square foot, moved past Tokyo’s inner central district ($144) to place second. Rounding out the top five were Mumbai and Moscow, both at about $125 a square foot. Leading North America was New York’s midtown district in 26th place at $64.51 a square foot, which placed it between Stockholm and Birmingham, England. Washington, D.C., was the only other U.S. city to make the top 50.
Worldwide, rents were down 4.6% from a year ago, but the trend may soon turn the other way, said Raymond Torto, chief economist for CB Richard Ellis.
“On a quarter-over-quarter basis, rental data in these markets is generally starting to show a bottoming,” he said, “and in some locations, such as London, even an uptick.”
Asking rents in Los Angeles County averaged $31.20 a square foot in the first quarter, according to brokerage Cushman & Wakefield, though some landlords are able to charge substantially more. Among the most expensive buildings in Southern California is 100 Wilshire Blvd. in Santa Monica, where landlords want almost $56 a square foot, according to data provider CoStar. Offices in the tallest building in the West, U.S. Bank Tower in downtown Los Angeles, can be rented for the comparatively cheap rate of $25.20 a square foot, CoStar said.
-- Roger Vincent
Photo: U.S. Bank Tower in downtown Los Angeles, where office rents are much cheaper than in other global cities. Credit: Mel Melcon / Los Angeles Times