LOS ANGELES-International law firm Davis Wright Tremaine LLP has renewed the lease of its 43,801-square-foot, class-A office space in Downtown Los Angeles, GlobeSt.com reports in this exclusive story. The lease value was undisclosed; however, according to industry sources and based on area asking prices of $3 per square foot, the lease value is approximately $16 million.

Tenant advisory firm Studley represented the law firm in the transaction. “One of the key objectives of our negotiations was ensuring that the lease allowed Davis Wright Tremaine maximum flexibility, meaning the firm has expansion rights, contraction rights and renewal rights,” Andrew Lustgarten, Studley corporate managing director, tells GlobeSt.com. “This allows the firm's occupancy to mirror its business.”

Located at 865 South Figueroa St., the 35-story building is walking distance to L.A. LIVE and FIGat7th. The firm will continue to occupy the 24th and 25th floors, and a portion of the 23rd floor. “The FIGat7th retail is a big amenity for companies and residents in DTLA, and the project continues to attract top retailers,” says Lustgarten.

While downtown is in the midst of a renaissance, Lustgarten explains that the “revitalization has had minimal impact on traditional high-rise office rental rates.” The downtown market overall remains stagnant, with flat office rental rates and vacancy rates in the high teens. “The downtown office market is fairly flat, whereas many other markets, specifically the Westside of L.A., tend to have significant peaks and valleys in terms of rental rate fluctuations,” Lustgarten says.

Lease renewals, on the other hand, make up the bulk of downtown office market activity, according to a Studley 3Q report, which explains that landlords are fighting to “retain tenants” mainly due to overall economic uncertainty and ample office supply.

Experts at a recent roundtable about the downtown market hosted by CBRE and Allen Matkins discussed competition between creative office and high rise buildings. High rise building owners are beginning to incorporate the same features and amenities in their buildings that creative office spaces offer.

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

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