Advertisement

Commercial property investment market improving, brokers say

March 18, 2012|By Roger Vincent
  • The downtown L.A. office tower at 400 S. Hope St. on Bunker Hill is for sale.
The downtown L.A. office tower at 400 S. Hope St. on Bunker Hill is for sale. (CBRE Group Inc. )

With the economy apparently stabilizing, commercial real estate investors have jumped into several markets in the West, brokers said.

“There is a lot of capital that needs to get out,” said broker Kevin Shannon of CBRE Group Inc. “People have fresh allocations for both debt and equity and … want to put it to work.”

The hottest markets for buyers in search of Class A office buildings are Seattle and San Francisco, he said, but activity should pick up in Southern California too. A high-rise at 400 S. Hope St. in downtown Los Angeles just hit the market and Shannon expects there will be competition to buy it. The 26-story tower formerly known as Mellon Bank Center has an assessed value of more than $225 million.

Attractive secondary markets for office buyers who don’t want to compete with the biggest investors include Denver, Portland, Ore., Phoenix and Orange County, he said. The long-suffering Inland Empire, where vacancy was above 23% at the end of last year, also holds promise.

“People have been afraid to go there,” he said, but it’s a small market with limited options for renters and its fortunes will turn around quickly if the economy continues to improve.

Shannon spoke at the CBRE/Allen Matkins online market forecast recorded in Burbank.

ALSO:

Office walls are closing in on corporate workers

Stalled Hollywood condo project reborn as luxury rentals

Trio of Warner Center office buildings sold for $26.4 million

Advertisement
Los Angeles Times Articles
|
|
|