America’s number one container port, the Port of Los Angeles (LA), is experiencing record activity pushing industrial rents up as demand for space reached an all-time high. While vacancies in coastal markets soared in the past year, LA occupancy grew by 6.7%. Rents in Los Angeles are high costing 18% more than the national average. In fact, office space rents have become pricier since the pandemic even though more space is available as employees continue to work remotely.
A Dynamic Economy
LA County is one of the most vibrant economies in the world powered by a rapidly growing and high-tech industry. It has a vigorous aerospace industry manufacturing satellites, medical devices, commercial aircraft, and motion picture equipment. The county is also strong in food and apparel giving the manufacturing sector an important role in driving economic growth within the region.
The success of the industrial sector is due to several factors. Technology, agility, steady supply of raw materials within the US and abroad, and capital creation through its product exports, LA could create well-paying jobs and attractive careers. For example, a titanium metal bar is an important component in several sectors. Given its lightweight and non-corrosive property, it is valuable as frame structures of aircraft. Equally, it is also used in airplane parts such as propellers and engines. Prosthetic devices and medical equipment are other applications of titanium. Ensuring its constant supply whether from overseas or domestic sources is critical so that the production processes remain unhampered.
HighGrowth Business Sectors
LA’s business sector is also helping the county rebound. One of the high-growth business sectors in LA is the construction industry, the second-largest in America. It is expected to experience a modest growth of 2.9% in 2021 fueled mainly by residential construction according to a Cumming project management report. Not to be overlooked is the transportation and logistics sector. LA is not only home to the nation’s largest ports system, it also operates one of America’s busiest airports attracting international trade and visitors. Due to e-commerce expansion, there is a huge demand for bigger transloading networks and services. LA’s port is experiencing tremendous growth in this area. The demand for industrial estate is also at an all-time high.
In the hospitality and tourism sector, although LA’s service sector was badly hit by the pandemic, it has also bounced quicker with employment recovering 64% of losses during the first 3 months of the virus according to the Employment Development Department. Unfortunately, unemployment is still high in the county although it has improved by 50%. Another very important sector in LA’s economy is the healthcare industry touted as both an economic and real estate powerhouse. The county hosts many top-tier medical institutions and well-regarded hospitals in the region. It employs around 440,000 workers and providers occupy over 49 million square feet of real estate per CBRE Report.
LA is bouncing back with jobs recovery on the positive side. In addition to the aerospace industry, transportation and logistics, hospitality & tourism, and the healthcare sector are providing the impetus to recovery and growth.
Cassandra Winter is a professional writer and editor. After a career in PR for an arts charity, she now focuses on writing about her favourite topics from public art to restoration and events. When not working she loves swimming, hiking and quiet nights in with her family.