LOS ANGELES | Downtown Project Rundown 4.0

[Zapatan]

It'll happen sooner or later, the economy is still very much in recovery stage.

[Zapatan]

Good news!

Update: While specifications for the single tower are still under study, Martin said it would be closer in height to the approved phase two office building. That structure was most recently imagined as a 60-story tower, but the entitlements would allow for a building of 1,250 feet in height, or 75-80 stories. If Korean Air built the tower as tall as its approvals allow, it would surpass U.S. Bank Tower as the tallest building west of the Mississippi River.

http://www.ladowntownnews.com/news/major...89af2ce-6e30-11e1-a5d1-0019bb2963f4.html

[Illithid Dude]

Originally Posted by Zapatan

Good news!




http://www.ladowntownnews.com/news/major...89af2ce-6e30-11e1-a5d1-0019bb2963f4.html

Called it! Now that we know we will have a nice tall tower, I wonder how the actual base will look, and how it will interact with the pedestrian environment.

Originally Posted by alki

Its negative in that they don't see demand for offices anytime in the forseeable future............ten years. DTLA needs to get office absorption back on track. That means competing directly with west side bldgs.

One of the biggest issues with vacant office space is that old, decrepit office space is counted along with the newer stuff. How much do you think the empty office space above Broadway contributes to the high vacancy rate? I think you will find that when more buildings on Broadway become converted to either A) actually usable office space or B) condos/apartments, the amount of empty office space will go away.

EDIT: Fun facts on office vacancy rates:

Downtown has an 18.6 percent vacancy rate, with a net absorption of 500,000 square feet in 2011. However, there was also roughly 500,000 square feet of office space that was left by downsizing firms and such. This means, at the current rate, assuming that firms stop downsizing, it would take 16 years for vacancy rates to drop below 10%. Luckily, net abortion per year should steadily increase.

The Westside also had a net absorption of 500,000 square feet, but had no downsizing firms. This means that vacancy dropped from 15 percent to 11 percent, which is very good. Assuming the pattern increases, the Westside should be below 10 percent in terms of vacancy, which is when new office construction is generally announced.

[StethJeff]

Originally Posted by Zapatan

Good news!




http://www.ladowntownnews.com/news/major...89af2ce-6e30-11e1-a5d1-0019bb2963f4.html

Um, ok . . . so we still lose a 45-story tower right in the middle of DTLA, and (not to be a dick, but) everyone is celebrating like an idiot? Am I missing something here?

[Illithid Dude]

Originally Posted by StethJeff

Um, ok . . . so we still lose a 45-story tower right in the middle of DTLA, and (not to be a dick, but) everyone is celebrating like an idiot? Am I missing something here?

Because, frankly, the taller office tower was never really going to happen. 1.5 million square feet of office space in an area with a vacancy rate of 18 percent? Fat chance. Now, we are getting a supertall that will be built, instead of one that wont.

[citywatch]

Originally Posted by Illithid Dude

One of the biggest issues with vacant office space is that old, decrepit office space is counted along with the newer stuff. How much do you think the empty office space above Broadway contributes to the high vacancy rate?

Downtown has an 18.6 percent vacancy rate, with a net absorption of 500,000 square feet in 2011. However, there was also roughly 500,000 square feet of office space that was left by downsizing firms and such. This means, at the current rate, assuming that firms stop downsizing, it would take 16 years for vacancy rates to drop below 10%.

the problem is that dt has had a high vacancy rate for over 20 yrs. I believe it's even the only area of any major city in the US that has never gotten that rate down to single digits, even when things started tightening up elsewhere over 10 yrs ago. So would those 16 yrs have to be added to the past 20? iow, will it take another 36 yrs before there's so little unused space that devlprs can start putting up office towers again? I hope not, but the trends over the past 20 yrs should make anyone go....

, esp if history is repeating itself & the other major hood of LA, 10 miles towards the west, has managed to again book up much more of its office bldgs compared with dtla.

I remember wondering several months ago whether the owner of the wilshire grand would want to put up a 2 tower proj, when one of those 2 towers would be on hold for yrs into the future. Based on the drawings of the original plan, that 2nd tower would have sat at the very visible corner of wilshire & fig. So would the devlpr really want a big blank on their land well after the 1st phase had been completed & opened?


skyscrapercity.com, flickr.com

^ I'd be surprised if the owner didn't think their previous plans would have ended up hurting their 1st tower, even if the blank spot next to it were turned into a nice temporary plaza til the 2nd bldg could be completed. Too many open plazas in the hood have a way of hurting the flow & continuity of a proj & easily become lifeless & boring. So I think the devlpr had no choice but to scrap the 2 tower idea, certainly since dt still has so much unused office space.

btw, I don't believe any of the very old space in bldgs around broadway has never been counted with the prime office space farther west. It's possible the old office bldgs around the OBD haven't been included as part of the stats for all major office space in dtla since the 1950s or 60s.

[Illithid Dude]

Originally Posted by citywatch

the problem is that dt has had a high vacancy rate for over 20 yrs. I believe it's even the only area of any major city in the US that has never gotten that rate down to single digits, even when things started tightening up elsewhere over 10 yrs ago. So would those 16 yrs have to be added to the past 20? iow, will it take another 36 yrs before there's so little unused space that devlprs can start putting up office towers again? I hope not, but the trends over the past 20 yrs should make anyone go....

You shouldn't be angry about things that happened ten years ago. Downtown L.A. wasn't a very nice place then, lest you forget. And besides, we totally overbuilt, much more then any other city, in the late 90s, and we are still recovering from that.

Moreover, you might remember that I said that those 16 years are only with the current rate of absorption, which will increase in the future, something you conveniently left out.

Originally Posted by citywatch

esp if history is repeating itself & the other major hood of LA, 10 miles towards the west, has managed to again book up much more of its office bldgs compared with dtla.

There is less office space on the Westside over a greater amount of land then downtown. It makes sense that they are recovering quicker. To use a really bad metaphor, it takes less time to drain a bathtub then it does a pool. And hell, don't pretend Downtown L.A. is, or will ever be, the most important area in L.A. The Westside having a recovering office market is just as important as DT having a recovering office market.

Originally Posted by citywatch

btw, I don't believe any of the very old space in bldgs around broadway has never been counted with the prime office space farther west. It's possible the old office bldgs around the OBD haven't been included as part of the stats for all major office space in dtla since the 1950s or 60s.

Why would it not be? I mean, it's vacant office space, is it not? Just because it is old and decrepit doesn't mean it doesn't count.

[LosAngelesSportsFan]

great news about the taller tower being built, sad to see that the project has been downsized from 2 to 1 tower though.

Im pretty sure that the Vacancy rate is only for Class A and or B office space so it wont include the old vacant stuff on Broadway.

[JDRCRASH]

^ True, but given the majority of Broadway's old office space will probably be converted into lofts, i'd say its likely a moot point when it comes to trying to lower downtown's office vacancy rate.

Btw sorry I've been really busy this week guys. I've only been posting via phone. But I'll update page 1 this weekend for sure.

[citywatch]

Originally Posted by Illithid Dude

Downtown L.A. wasn't a very nice place then, lest you forget. And besides, we totally overbuilt, much more then any other city, in the late 90s, and we are still recovering from that.

I'm not sure if any more building took place in dtla compared with what happened in at least a few other major cities in the US, esp since many of them started to boom around the late 1990s. but even if there was more in dtla than elsewhere, the last major highrise tower for business users was completed when? the early 1990s? that's entering the 2 decade mark.

just as important, when more of the space finally seemed to be coming closer to full booking a few yrs ago, businesses again started moving out or shutting down & the vacancy rate went right back to where it was over 10 yrs ago. So 2 steps forward, 3 steps back.

Why would it not be? I mean, it's vacant office space, is it not? Just because it is old and decrepit doesn't mean it doesn't count.

I vaguely remember seeing a list published a long time ago of all the bldgs included in the official totals of office space in the hood, & none of them were farther east than Olive St. Since then, I imagine that some of the space tallied at that time has since been excluded, either because it's now considered below C grade----as mentioned by LASF----or....& this is a biggie....it's been converted into housing. actually, with all the old bldgs that are now used for apts or condos & no longer set aside for businesses, the amt of empty office space should be that much lower. But in spite of that, the fact the vacancy rate still remains as high as it is should make everyone pause.

[Illithid Dude]

I'm not sure if any more building took place in dtla compared with what happened in at least a few other major cities in the US, esp since many of them started to boom around the late 1990s. but even if there was more in dtla than elsewhere, the last major highrise tower for business users was completed when? the early 1990s? that's entering the 2 decade mark.

In a space of three years, we built six of the ten tallest buildings in Los Angeles. Considering that one building of that height is around 1.5 million square feet, that is almost ten million square feet of office space. That's not even including all of the smaller buildings built around the city around that time. Now, since you compare L.A. to other cities, let's make a comparison. L.A. has many, many office markets. It's very decentralized. Most other cities, weather that is Seattle or Boston or Chicago, are very centralized. This means that if they built ten million square feet of office space in their CBD, it would be all of the new office space in the city, and thus quickly recover. L.A. built ten millions square feet downtown, and then millions more across the rest of the city, making it much more difficult to fill. In short, L.A. overbuilt far more then any other city did.

Originally Posted by citywatch

just as important, when more of the space finally seemed to be coming closer to full booking a few yrs ago, businesses again started moving out or shutting down & the vacancy rate went right back to where it was over 10 yrs ago. So 2 steps forward, 3 steps back.

Well, of course office vacancies rose a few years ago. The Recession started! It's not like things would continue to get better during the Recession, then it wouldn't be a recession.

In more important news, this is my 1000th post! Yaay! Sort of sad, really, that in a little more then a year I have posted a thousand times, but no matter. I think this necessitates a dancing banana.



There, a dancing banana. And I never post emoticons, so that alone is a momentous thing for me.

[DJM19]

Downtown does need to work on its office occupancy, but that will come with time. The area is slowly becoming more desirable to live in, and livability will mean companies feel fine sending their workers there.

Also, when expo and the purple line reach further west, companies will see that as a viable way for workers to reach work downtown. That solves a major issue for how companies determine location. It means only downtown will be well connected to employees from all directions.

[JDRCRASH]

Citywatch, I really doubt it will take "36" years until another office building is built. In fact at most I think it will take a 3rd of the time. Reason? Times have changed, and DRAMATICALLY since the last office building went up in the early 90's. Not only are there far more residents in the area, but as DJM19 noted, its infrastructure has come a long way as well, with almost two more light rail lines built, and a connector to link them both on the way. And as Illithid pointed out, the recession stunted the office recovery (and yet we saw new office towers - 755 Fig - actually proposed, which is a big deal). When all this is factored in, I actually think the office market will recover even faster now.

[Zapatan]

Originally Posted by StethJeff

Um, ok . . . so we still lose a 45-story tower right in the middle of DTLA, and (not to be a dick, but) everyone is celebrating like an idiot? Am I missing something here?

Because both buildings were never certain. Usually they cancel the taller project, however, LA still (likely) gets a new tallest. Why is that not something to celebrate?

[pesto]

I think all that the developer is saying is that the new building will be taller than the shorter one, not that it will be equal to the taller one. The taller the better, but I'm too gun shy to get optimistic yet.

In general, there has been a move to low-rise campuses with ample parking, easy connections to transit, dedicated exercise and food facilities. This also plays to Californias great weather and recreation opportunities. The highrises are becoming service oriented (law, accounting, financial services) or small "front offices" to give the company some cache. I don't think this trend bodes well for much of the office space downtown (nor really for any area very much).

[Zapatan]

Originally Posted by pesto

I think all that the developer is saying is that the new building will be taller than the shorter one, not that it will be equal to the taller one. The taller the better, but I'm too gun shy to get optimistic yet.

In general, there has been a move to low-rise campuses with ample parking, easy connections to transit, dedicated exercise and food facilities. This also plays to Californias great weather and recreation opportunities. The highrises are becoming service oriented (law, accounting, financial services) or small "front offices" to give the company some cache. I don't think this trend bodes well for much of the office space downtown (nor really for any area very much).

It did mention that it could top the US Bank tower.

The most recent renderings of the shorter tower show it at 750 feet, with double the space, while it won't likely get to 1500 feet, the building should still be very tall and probably wider. They announced the Wilshire as the new tallest building in LA and it would be in their best interest to build such.

[Zapatan]

Closer in height doesn't necessarily mean shorter, especially if they ditched the spire. Developers want the city's tallest, I don't see much of a reason to build a few feet under the US bank tower.

Update: While specifications for the single tower are still under study, Martin said it would be closer in height to the approved phase two office building. That structure was most recently imagined as a 60-story tower, but the entitlements would allow for a building of 1,250 feet in height, or 75-80 stories. If Korean Air built the tower as tall as its approvals allow, it would surpass U.S. Bank Tower as the tallest building west of the Mississippi River.

[alki]

Originally Posted by Illithid Dude

One of the biggest issues with vacant office space is that old, decrepit office space is counted along with the newer stuff. How much do you think the empty office space above Broadway contributes to the high vacancy rate? I think you will find that when more buildings on Broadway become converted to either A) actually usable office space or B) condos/apartments, the amount of empty office space will go away.

It doesn't work that way. Most office space on Broadway and points east like on Spring and Main were discounted long ago. They are considered Class C and below.......and considered uncompetitive for offices. We're talking Class A and Class B.............the newer stuff west of Broadway and on Bunker Hill.

EDIT: Fun facts on office vacancy rates:

Downtown has an 18.6 percent vacancy rate, with a net absorption of 500,000 square feet in 2011. However, there was also roughly 500,000 square feet of office space that was left by downsizing firms and such. This means, at the current rate, assuming that firms stop downsizing, it would take 16 years for vacancy rates to drop below 10%. Luckily, net abortion per year should steadily increase.

The Westside also had a net absorption of 500,000 square feet, but had no downsizing firms. This means that vacancy dropped from 15 percent to 11 percent, which is very good. Assuming the pattern increases, the Westside should be below 10 percent in terms of vacancy, which is when new office construction is generally announced.

Here's some more fun facts. DTLA and suburban LA county......which includes the West Side and the Valley......had negative absorption for all 12 mos of last year. Most major office markets began to recover in the latter half of 2010. Many of them saw decent [not great] growth in 2011. LA saw none......scroll down for the numbers:

http://www.colliers.com/Country/UnitedStates/content/Colliers_officenahighlights2011q1.pdf

Last year, LA's employment growth was anemic at best. It was up .49% for the year. Compare that to SF's increase of 1.4+% and Houston's 3%. Like I've said before, you want new office bldgs you need employment growth.

The last major office bldg built in DTLA was in 1992. The last office bldg built in Century City was in 2002. Huh? LA is the second largest metro in the country........and yet, its been 20 years since a new bldg has been built DT. What gives?

In fairness, LA has never been a huge office generator............but it never was this pathetic. Just the facts.

[alki]

Originally Posted by citywatch

the problem is that dt has had a high vacancy rate for over 20 yrs. I believe it's even the only area of any major city in the US that has never gotten that rate down to single digits, even when things started tightening up elsewhere over 10 yrs ago. So would those 16 yrs have to be added to the past 20? iow, will it take another 36 yrs before there's so little unused space that devlprs can start putting up office towers again? I hope not, but the trends over the past 20 yrs should make anyone go....

You're right. The last bldg built in DTLA was in 1992 and it took nearly 5 years to lease up the space. No new office bldg will go up in DTLA period until there is better absorption.

MODERATOR EDIT: Keep the posts on topic. This thread is for downtown projects. Alki, you've been warned before. Posting images or stats from other cities in this thread will result in a suspension from the forums.

[skyscraperfan23]

Originally Posted by Zapatan

It'll happen sooner or later, the economy is still very much in recovery stage.

There is no recovery, it's a coverup.