LA Curbed: Los Angeles has the third largest pool of tech workers on the West Coast
By the report’s count, there are nearly 140,000 employees in the Los Angeles metropolitan area working in “technical jobs,” including software development, tech support, and programming.
That accounts for just over 3 percent of all jobs in the area—a relatively small portion compared to, say, the Bay Area’s 10 percent. The average tech worker in Los Angeles earns $104,000 per year, according to the report. The median household income in LA County, meanwhile, is $69,300.
The biggest names in the industry—including Google, Apple, and Netflix—are expanding in Los Angeles, often building new ground-up offices, but the report takes the entire industry into account, including, for example, software engineers for a healthcare company.
The lucrative industry has made an impact on housing in many LA neighborhoods near its Westside hubs. But the CBRE report looks mainly at office demand, and it highlights how office space for tech companies has become a hot ticket item.
Competition for space has pushed up the cost of renting office space. Now only Manhattan, the Bay Area, and Washington D.C. have higher average office rents than LA, the report says.
Tech companies are looking beyond traditional office space when they’re considering where to put down roots. Many larger companies, like Google and Netflix, are looking to rent up entire office complexes, often before they are even finished.
CBRE’s director of research for LA County, Petra Durnin, tells the Los Angeles Times that of the roughly 3.8 million square feet of office space under construction in the region now, half of it is already leased.
As in the case of Netflix’s leases at new, ground-up projects in Hollywood, the companies are looking for buildings that aim to create an open, flowing environment, with airy, high-ceilinged interiors that bring in lots of natural light and connect to landscaped outdoor spaces, including balconies, rooftop lounge areas, and terraces.
At 14.5 percent, LA’s office vacancy rate is relatively high when compared to some of the other top markets, says Colin Yasukochi, CBRE’s director of research and analysis for the Western Region. (The Bay Area is 6.1 percent, the report says.) LA’s a large area, so the rate will vary considerably depending on where in the city the office is.
A report from commercial real estate firm JLL breaks the LA area into smaller local markets and finds that the most desirable offices in Santa Monica were asking more than $6.60 per square foot on average, while the most sought-after workspaces in Culver City were renting for an average of $4.40 in the second quarter.