- Downtown L.A. office towers sold at roughly $130 to $150 per square foot versus a pre-pandemic average near $450, and half of recent metro office sales closed at a loss.
- Family offices, private lenders and owner-users are buying or financing selectively, while Q3 office leasing reached 4 million square feet, up 15% year over year.
- Loan maturities peak in 2027 at $6.2 billion, but expensive financing and Measure ULA keep new development largely sidelined.
Los Angeles is starting to attract investors hunting deep discounts on office assets and steady housing demand, according to Commercial Observer.
Sentiment remains cautious after six rough years, but capital from outside the region is returning, particularly in Downtown L.A.
Get Smarter about what matters in CRE
Stay ahead of trends in commercial real estate with CRE Daily – the free newsletter delivering everything you need to start your day in just 5-minutes
Prices Reset Hard
Capital Group bought Bank of America Plaza, its corporate headquarters, for $210 million in March at close to $150 per square foot. The Aon Center sold for roughly $130 per square foot, against a pre-pandemic neighborhood average near $450.
Uncommon Developers paid $210 million for the Figueroa at Wilshire tower in summer 2025, a 40% discount. Newmark data shows half of metro L.A. office sales in the second half of 2025 and first half of 2026 closed at a loss.
Long-Term Capital Moves In
Fortress Investment Group provided $96 million for Cityview’s Jasper multifamily project downtown. G4 Capital Partners opened an L.A. office in April to provide private lending for residential projects.
D2 Asset Management sees affordability pressure and middle-income workforce housing as an opening for debt, and 3650 Capital’s Jonathan Roth said family offices with a generational horizon see L.A. as cheap.
Leasing Shows Signs of Life
Savills counted 4 million square feet of third-quarter Los Angeles office leasing, a 15% jump from a year earlier. Renewals made up most of the volume, though Universal Music Group signed a new deal and Banc of California opened a 40,000-square-foot downtown office.
Downtown office vacancy still runs above 20%. The 730,000-square-foot 1950 Avenue of the Stars in supply-constrained Century City comes online early next year.
Why It Matters
Small or nonexistent development pipelines in most major submarkets should keep supply tight over time, which helps a recovery. Cushman & Wakefield analysts expect more value-add, owner-user and public-sector buying as pricing adjusts.
Financing is the bottleneck. Multifamily developers are mostly sidelined by rising costs, tough lending and Measure ULA, the three-year-old tax on pricier real estate trades.
What’s Next
Savills’ Dalton Brusseau expects L.A. office loan maturities to peak in 2027 at $6.2 billion, which he says could spur new ownership and leasing. The Urban Land Institute also recommended a downtown development corporation and a tax-increment finance district.
The $2 billion Fourth and Grand project and a possible Oceanwide Towers cleanup still need funding, and the 2028 Olympics offer a deadline for downtown to start rather than finish.
