Tri-Cities Reap Benefit of Hollywood Boom

The Tri-Cities market is benefiting from the—what we will call—Westside effect. Playa Vista, El Segundo and Culver City are all experiencing tremendous office activity because of spillover demand from Santa Monica, Venice and West L.A. Now, the office boom in Hollywood is driving tenants seeking low-cost alternatives into Burbank and Glendale. These Tri-Cities anchor markets could become Hollywood’s Playa Vista.

“The Tri-Cities market has been has been a good lower cost option for people that are looking in Hollywood or that have leased space in Hollywood. Burbank specifically has become Hollywood North, and there are a lot of entertainment companies out in that area,” Steve Kolsky, EVP and managing principal at the Newmark Knight Frank, tells GlobeSt.com. “Glendale has been seeing a lot of activity, and that is usually the lowest cost option. Typically, you see companies going there to save money. My understanding from things that I have heard is that there is a lot more office activity happening in that market.”

The fourth quarter office report, however, shows that the Tri-Cities marker, along with Downtown, had a weak month for absorption. That could be do to low move-in activity rather than leasing activity, according to Kolsky. “There is a lot of product at a reasonable price, and the Burbank market does well—even if the numbers don’t show it,” he says. “We are seeing creative companies, especially ones that do work with various studios, looking at the Tri-Cities as an alternative to being in Hollywood.”