Law Firms Find The Right Fit In Two Los Angeles Neighborhoods
In the years right before the pandemic, tech and media tenants fueled the Los Angeles office market. As those tenants have receded, with the popularity of remote work, one group has emerged as a reliable occupier: law firms.
Those tenants are so far continuing to favor to two familiar submarkets, Downtown and Century City.
A new midyear report from JLL said while some of the larger leases of the year so far have been law firms decamping to Century City from Downtown, both submarkets remain top spots for law firms.
When it comes to rents, Century City is commanding far higher rents than Downtown. The neighborhood has those top-tier offices that many occupiers are eyeing as well as "a reputation for safety and extensive retail options," the report said.
Class-A space in Century City can command a base rent of $84 per SF, and trophy space can start at $100 to $125 per SF, JLL found. The submarket has seen more than 500K SF of leasing activity over the last 12 months. One of those transactions was Skadden, Arps, Slate, Meagher & Flom, which left Downtown for almost 58K SF at 2000 Avenue of the Stars in Century City.
It's a tenant's market in Downtown, where those firms that have decided to stay in the neighborhood have often shrunk their footprint. Sidney Austin, for instance, downsized to 57K SF on Bunker Hill from about 136K SF in the Gas Company Tower, The Real Deal previously reported.
"Looking ahead, tenants will have more large blocks of space to choose from in Downtown LA," the report's authors wrote, and with its proximity to the Superior and Federal court complexes, "Downtown LA will remain a desirable location for law firms."
The report anticipated that competition for trophy space in Century City could continue to drive rents up there. As in the broader office market, law firms are also making the flight to quality as well as making the so-called flight to capital, seeking out landlords that can ensure stability and hearty tenant improvement allowances.
