The Westside led in office absorption in the fourth quarter, according to a new report from Newmark Knight Frank—but that is probably not much of a surprise. The Westside is generally a leader in office activity. Lately, that is because tech companies have planted roots in Santa Monica, dubbing the city L.A.'s Silicon Beach. With rising prices, however, Silicon Beach has moved around the Westside area, starting in Santa Monica before moving to Playa Vista and now El Segundo and even as far east as Hollywood. To find out more about the evolution of a market that drives much of L.A.'s office activity and where it is headed next, we sat down with Steve Kolsky, EVP and managing director at NKF, for an exclusive interview.

GlobeSt.com: The Westside led in office absorption for the fourth quarter. Your report attributed this to activity from tech companies, which have garnered the Westside market the name Silicon Beach. What has been the pattern for Silicon Beach activity on the Westside?

Steve Kolsky: The Westside has always been strong, even in down markets. It always outperforms other submarkets because it is close to where decision makers live. There is always a lot of demand in the Westside markets. As the market gets stronger, people start looking for more affordable alternatives. Playa Vista was that alternative at the beginning of the last cycle. They finally had all of the product in place and the right product mix. So, they had good supply and they were a lower cost option. That market was very hot, filled up very fast and became the new Silicon Beach. What started in Santa Monica moved to Playa. That market has really matured, and there is no longer a lot of space available there.

GlobeSt.com: Where is Silicon Beach heading today?

Kolsky: Another logical market is the South Bay, in particular El Segundo. That is a combination of the aerospace industry had a lot of buildings being vacated that were perfect for conversion to creative office. The lower Westside had truly expanded to include Playa, and El Segundo is just a short trip from there. So, it has proximity to Playa and a lot of decision makers now live in the South Bay. That is one of the reasons why activity has increased in those markets.

GlobeSt.com: The Westside isn't the only market attracting tech companies. Hollywood is another active tech market. How does this fit into the evolution of Silicon Beach?

Kolsky: Hollywood growth came from a different place. Really, no one wanted to be in Hollywood for a long time because of the congestion and the quality of the buildings A few years ago, there were changes in zoning laws that opened it up and made it more favorable for development. There was a lot of development in the multifamily and office arenas. On top of that, there is good public transportation. One of the trends that we are seeing with creative companies—especially those going after young employees—is that they value public transportation as well as housing, restaurants and nightlife, and Hollywood was the perfect catch for that.