A recent article published from Bloomberg.org discusses the rise of creative space throughout major cities. The resurgence of the digital technology sector has created a demand for this type of creative office space. This time around, major developers and institutional investors acknowledge this trend and have driven down the yields on this product. Certain features of the space are leading to new ways of working, especially for firms with employees who spend a lot of time on computers or mobile devices. This is a shift from a traditional office environment where employees focus their time in small conference rooms or on the telephone. At PMI, we continue to strive for our spaces to promote creativity, collaboration, and the ability to scale if needed.
In all of about 15 years in Los Angeles, there were only about three or four developers doing this. PMI was one of them. None of them were institutions. It was hard to get financing as the lenders believed this type of office design was a fad. PMI was able to buy Marina Studios because the lender who foreclosed could not figure out what exactly Marina was or how it should be used. It did not work as an industrial building and it did not look like offices. PMI was able to take control of the building, effectively design and market it, and we now currently maintain a fully leased building.
The full article outlines more of the characteristics of these new, emerging offices.
PMI Property is proud to announce that Bebo.com, the social networking website, signed a 2,000 square foot lease to relocate it’s headquarters to the creative office building at 10951 Pico Boulevard in West Los Angeles, California.
Bebo was catapulted onto the social networking scene and embraced by users in 2005. It can be considered one of the first examples of creating a successful social networking site. Unfortunately, Bebo was quickly overshadowed by MySpace. Then Facebook launched, and the social networking revolution we all know today exploded. AOL purchased Bebo in 2008 for $850 million and sold it to the current owners for under $10 million in 2010. The original founder Michael Birch netted $300 million on the deal after investing $8,000 to start Bebo. The current owners operate Bebo as an international social meeting website, and it boasts over 400,000 unique visitors a month in the United States alone. Bebo still has to compete with the giant of the social networking game: Facebook, with their 140 million unique monthly visitors. In contrast, Friendster is down to 77,000 users a month.
But Bebo survived, and has fared well in comparison to other sites. They feature personal profile pages for users where they can post blogs, photos, music and videos, as well as online gaming. Be sure to check out our new tenant, Bebo to see what they have to offer!
The Otis College of Art and Design commissioned a report for 2010 which was compiled by the Los Angeles County Economic Development Corporation. The report shows a loss of 80,000 jobs in Los Angeles creative industries from 2007 to 2010. Only digital media employment managed to remain steady over the same period. Since creative workers occupy creative office, these statistics explain the absorption losses in L.A.’s Westside creative office market.
What about 2011? Our calculation of the Los Angeles creative industries (excluding informational services) reveals a gain of only 1,200 jobs from November 2010 to November 2011. This percentage gain, under one half of one percent, corresponds to the sluggish leasing recovery in the greater Westside creative office buildings. In constrast, information services alone gained 5,200 jobs– an increase of over 65%. This job explosion in digital technology has translated to a surging demand for creative office space, so far primarily in Santa Monica.
This article by Mike Boehm of The Los Angeles Times lays out all the findings of the Otis Report on the Creative Economy of Los Angeles and Orange Counties:LA Creative Jobs, LA Times Dec 20 2011.
The market for affordable rental properties in the greater Los Angeles area has become a tricky question with an increasingly problematic solution. If you are lucky enough to get a tip about a reasonably priced dwelling, chances are hundreds of other people did too– and you might just be too late. The demand for affordable housing in Los Angeles outweighs the quantity that is actually available. The lack of sensibly priced rental properties has become somewhat precarious for residents. Some people are going to extreme measures to provide what they consider as affordable housing. One the other hand, some disagree that these properties are too small and crowded. They feel that the landlords of these buildings are walking the line of illegal and immoral activities. Hopefully the L.A. Housing Authority will step in and prevent this from happening again.
There are people taking the lack of space in Los Angeles to a whole new level. A person converted a single family home into multiple apartments where 44 people lived for rents as high as $500 per month. This article explains the situation that occurred in South Los Angeles. Check it out to read the entire story from the L.A. Times.