Enriching the lives of our family of investor
Home | Site Map | Legal | Contact Us 

 
RESEARCH CENTER >>MARKET COMMENTARY:
LOS ANGELES BASIN   
Q3, 2007 
 
 
After a favorable 2006, Colliers International (which is the highest-ranked commercial real estate firm on the Global Outsourcing 100 Companies List), believes investor confidence in the Los Angeles Basin commercial real estate market has increased once again as the area climbed in the forefront of institutional and private investors. The Los Angeles Basin consists of Los Angeles, Orange and Ventura Counties and the Inland Empire region.

Through careful research and analysis, experts in the commercial real estate market project continued growth and offer valuable insight on the following topics:

  • Economic and job growth
  • Demand for commercial real estate
 
Economic and Job Growth
 
According to Colliers International, analysts are expecting a slight economic slowdown in 2007, but project significant growth for 2008 and 2009*. Generally, growth in demand for commercial real estate follows the same pattern. As a result, market conditions are projected to remain generally healthy-to-tight over the next three years with the following estimated vacancy rates:

Office Sector

11%

Industrial Sector

4%

Retail Sector

4%

Apartment Sector

3%

Increased job growth translates into heightened demand for all commercial property types.

It is estimated that between 2007 and 2009 the average number of jobs added to the Los Angeles Basin will be 115,000 - an average annual job growth of 1.57%. The fastest growing area, in terms of job growth, is projected to be the Inland Empire with a projected average annual growth of 2.8%. **

Demand for Commercial Real Estate

Research indicates that the demand for space across all commercial property markets will be relatively strong in 2007 and quite strong in 2008 and 2009, with the fast growing business sectors of: professional and business services, financial activities and information - which includes publishing, motion pictures, broadcasting, telecommunications, internet services and data processing. While increase demand for space will continue to take place throughout the Los Angeles Basin, Colliers International believes the Inland Empire will capture more than its share of the growth in demand for office, retail, industrial and apartment space.

Over the next three years, with positive projections of economic and job growth, the Los Angeles Basin commercial real estate market may remain favorable with institutions and private investors.

 

*Source: Colliers International, 2007

**Source: Moody’s Economy.com