Given the end of the year is just around the corner, a good amount of Los Angeles real estate discussion is now focusing on what to expect for the new year. 2023 has been very much of a stabilizing year, as well as one that has been in a bit of back and forth flux, especially in the commercial real estate arena. However, as normality continues to settle in, and the office world is finding a new reality after months of social tugs of war on return to work or not, 2024 looks to be a year of permanent new changes per Steven Taylor LA and his analysis below.

Retail Is Likely To Return

With more and more employees returning to the office, whether out of desire or direction, retail will benefit. The simple fact is, when people are out doing their work, they shop and eat. And retail is the primary benefactor of that shift. Retail suffered horribly during 2020 and 2021, and those that survived had to use 2022 and 2023 to recover from losses and stabilize their reduced platform going forward. Now, with an increased presence in urban centers, economic areas are expected to see higher foot traffic, which will increase the demand for retail space again.

Hybrid Defines The New Office

The above said, the return to work will not be a full reversal of the last few years. It will take a lot to reverse the slump from the 2023 summer. In fact, hybrid work is extremely popular and very functional, both for employees and employers trying to fit in more people into the same facility. Strategies of “hoteling,” where multiple staff work at the same desk with overlapping hybrid schedules have increased dramatically. It allows companies to fit in more skill resources without expanding their rental or facility footprint, but it does require changes in how the office operates. Steven Taylor Los Angeles also notes that it increases the demand for traffic and vehicle parking as well.

Weather Dictates Popularity

Los Angeles has always enjoyed the advantage of better weather year-round and that continues to make the location a popular place to work. So, as businesses grow again, the need for commercial space in LA and the related region is expected to grow again versus other urban centers nationally. It’s mainly the cost of property versus other locations that makes alternatives competitive to LA. However, the idea of being able to be in generally sunny weather most of the year still remains attractive, no matter how die-hardened a company is for the sub-zero areas of the country.

Renovation Continues To Drive Land Use Change

Los Angeles City has been quite proactive in redevelopment, shifting properties from commercial to residential and vice versa. This shift opens up new markets and opportunities, especially for those looking to get into commercial property in areas where it didn’t exist before in the City. As projects continue to be approved, the changing landscape of Los Angeles will provide new ventures and venues for businesses to establish themselves, particularly smaller, more nimble operations who can operate at a boutique level versus a big building footprint.

Tapping into these changes will be the high point of 2024, along with the other trends noted above.