How L.A. Office Investors Are Catering to the City’s Most Prominent User

The office market in Los Angeles is continuing to recover following the pandemic. While some areas of the sprawling market are still facing limited demand and high vacancy rates, techtainment—the word used to describe the convergence of entertainment, technology and media companies—hubs are thriving.

“Leasing activity in Los Angeles was the highest it has been since the onset of the pandemic in Q4 2021, driven in large part by the technology, media and entertainment industries, and their convergence—also known as techtainment—that often require in-person collaboration,” Rob Solomon, chief development and legal officer at BLT Enterprises, tells GlobeSt.com.

Activity from this industry shows that Los Angeles has a deep well of office demand. “Los Angeles and surrounding markets will always be a top employment hub, due to the region’s positioning as a historic home of many lucrative industries and the high quality of life it offers,” explains Solomon.

Investors have turned their sites on techtainment companies, and have focused on investment opportunities that cater to this demographic. To capture the demand, many are investing in the low-rise and freestanding buildings that are often popular among companies in this sector. “We continue to observe a strong preference for office space in free-standing buildings and low-rise complexes, which allow users to enact more control over their space to ensure employee safety,” says Solomon, noting that the Hollywood Exchange creative campus, which BLT acquired in 2020, is a perfect example of the type of property fit to serve these users. “Creative campuses have thrived as they combine studio space and offices of varying sizes to create a lively campus environment.”

In addition, techtainment users look for highly designed spaces. “Strategically designed creative office and flex spaces that offer prime locations—such as West LA, Hollywood, and Santa Monica—have continued to perform well throughout the pandemic, as open and adjustable space has proved especially crucial,” says Solomon.

This trend is only just gaining momentum. “We anticipate that we will see more investment in spaces that cater to these industries,” says Solomon. “That could drive a more rapid recovery in Southern California compared to other markets.”