Vacancy Rate in Downtown Area Decreases

The vacancy rate in downtown Los Angeles’ office buildings dropped to 11.4% in the third quarter from 14.6% in the second quarter and 15.8% a year earlier, according to a study by the downtown office of Grubb & Ellis Commercial Brokerage Services.

It was the third consecutive quarterly drop this year, the brokerage said. “What we’re seeing is a return to a landlord’s market where rental rates and concession packages are no longer as generous as they were last year,” said Jeffrey T. Carey, vice president in the fir ‘s downtown office.

The study said office vacancy rates will likely drop below 10% by the end of the year, but will begin rising late next year as the pace of preleasing cools and more office space comes on the market. About 3,494,070 square feet of office space downtown was available in the third quarter, the study said.