Downtown Los Angeles and the greater LA area continue to face economic and commercial real estate challenges. However, there are reasons for optimism. CBRE Managing Director Jessica Lall will be a presenter at the upcoming Connect LA 2023 event . Recently, Lall sat down with Connect CRE to answer questions about current CRE issues in DTLA.
Connect CRE asked: How is commercial real estate fairing in DTLA following the difficult pandemic years? What are some bright spots and challenges?
Lall responded: Downtown LA is currently experiencing a perfect storm of sorts. First off, loans maturing at an inconvenient time have caused uncertainty around return-to-work plans which has resulted in occupiers preferring shorter-term deals over longer commitments until they know how things will shake out. Additionally, there’s been a perception of downtown being unsafe due to various factors that contribute to this uncertainty; however if more people can be encouraged back on its streets it could help improve safety perceptions as well as other related issues we’re seeing today. Despite these difficulties there remain opportunities such as clients getting creative about work space by making changes beyond just paying for lunches or office space conversions into hotels or residential units when feasible – all helping improve back-to-work conditions while also providing alternative uses like childcare or educational facilities for repurposing downtown office spaces that may not otherwise see occupancy soon enough given current market conditions where comps are low but offer advantages both occupiers and investors alike should they weather through this period successfully.. Ultimately though despite any short term pain felt right now urban centers always bounce back so long term prospects still look positive here too!
Connect CRE then inquired further regarding economic issues impacting DTLA’s landscape specifically; what was revealed was how challenging it remains with mandates yet pending later this year concerning returning workers compounded by recessionary pressures along with interest rate hikes particularly affecting offices although industrial & multifamily sectors have seen less impact from them comparatively speaking – creating possibilities such as reuse/repurpose options especially beneficial during times like these when available debt financing isn’t quite so easy come by either (especially those owners facing maturities).
Finally discussion turned towards housing matters including affordability & supply concerns currently plaguing many cities across America where 80k already reside within DTLA alone expectedly growing up 120k eventually requiring affordable places nearby their workplaces thus why RENA (Regional Housing Needs Assessment) initiatives were pushed forward initially plus updated rules/regulations needed streamlining construction processes going forward since politics often gets involved preventing progress made otherwise – necessitating state level enforcement ensuring goals set get met regardless ultimately leading us closer towards resolving our housing crisis one way another before too long hopefully!
