Commercial Real Estate Investment in La Presents an Excellent Opportunity
Last year, LA Biz ranked Los Angeles as the best place for commercial real estate investment for the third year in a row—not only in the U.S. but in the entire western hemisphere. Although other markets are on the rise, LA remains at the top for several reasons. Let’s take a look at a few:
1. Prices
Because housing is at a premium, rents are high in LA, and they’re only getting higher. GlobeStreet reports that average rent prices in LA rose 6.6% to $2,461 a month last year--the 3rd steepest hike in the country. Occupancy is up to 97%, and inventory is down 14%, creating a perfect storm for investors in commercial real estate--especially in multi-family units.
2. Transportation
LA’s public transit transports people via trains, light rail, and buses with six lines and 80 stations connecting all of the great neighborhoods around the city. There are also three different bus services available. The autonomous car revolution is beginning in LA, and with the growth of Uber and Lyft, the number of two-car households is decreasing. Biking and bike sharing are on the rise as well. Having accessible public transportation to get around LA and the outskirts is a definite bonus to purchasing Los Angeles real estate.
3. Interest Rates
Though interest rates are on the rise, right now they are still meager, so your buying power is still more significant. Because interest rates could not have gone much lower, real estate investors are still benefiting from the low rates.
4. Progress
LA has evolved over the last five years, especially with new offices, stores, residential properties, and restaurants lining the streets. With this growth comes more opportunities for investors to purchase commercial real estate. With these newly-developed properties, more rooftop bars and outdoor areas for socializing have been created, taking advantage of the great weather and stunning views of downtown.
5. Outskirts
With so much growth and development in the core of LA, the outskirts will become more profitable as well. If commercial space is not available in the central areas, going to the adjacent spaces will be just as profitable and may even prove more attractive.
6. Sports
With the LA Chargers coming back to town along with the LA Rams, a new stadium is being built in Inglewood where both teams will play. This new stadium will be a considerable attraction around which commercial real estate will grow. The community pride should improve with allegiance to these teams in addition to the pro teams that are already established in the area.
All of these are fantastic reasons to invest in Los Angeles commercial real estate, but acting now is key. Take advantage of the interest rates, low inventory, population, and progress to grow your real estate portfolio. Call us today for more information on availability and possibilities.