Los Angeles has the third largest pool of tech workers on the West Coast, after Seattle and San Francisco, according to a report released last week by commercial real estate firm CBRE.
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.
Comments
An euphemism for an open-plan office.
I was at these offices. 6 people sat around a table. No privacy, lots of talking.
But Santa Monica!
By Ivan III on 07.22.19 3:03pm
That is the modern office and all sorts of companies are going to that model for better or worse not just tech companies.
By LA Denizen on 07.22.19 3:19pm
That’s why when I go to a job interview, I ask to show my future working space.
I had a coworker who constantly farted after eating lousy food. Another who stood behind me and criticized my way of thinking.
By Ivan III on 07.22.19 3:37pm
Sorry about all of that
By subaruwrx on 07.22.19 3:42pm
i work in a cubicle and the old guy next to me burps and clears his throat all day.
By baba100000 on 07.24.19 1:29pm
That is my nightmare.
By Greyvagabond on 07.22.19 4:52pm
You mean working?
By calzada on 07.22.19 5:39pm
Makes you long for the days of tiny cubicles, doesn’t it?
By mrjim1 on 07.22.19 6:58pm
This type of setup would be an immediate deal-breaker for me when looking for a new job.
By SC310 on 07.24.19 8:24am
What YIMBYs say: "It’s way harder to get a job these days and they don’t pay enough to buy a home in a couple of years like they did for the Boomers."
What YIMBYs do: "Hey I know this starting salary for a UC graduate like me is much closer to the average than it was 30 years ago but if you expect me to work in a setting that 95% of the rest of the world does, well I’m outta here."
When we started working things were tough in LA with high housing prices at the time. And no one was turning down a job, not even one paying $24k, because of the work environment.
It was more like here’s a pad of paper and your cubicle, go to work. Take calls all day and keep up with your daily reading of the trade journals. Don’t read magazines too long or it will look like you are goofing off. If you are away an ATS (secretary back then) will leave a "call back" slip on your desk. Call that person back right away. If you need to send them a memo have the ATS type it up and mail it to him. If he’s overseas you can use the fax machine but go easy on that, faxes are expensive. Put a carbon copy on my desk.
Cubes worked fine when you needed to be on the phone all day and had to file paper documents in a cabinet. With e-mails taking the place of phone calls and electronic files replacing paper, cubes are a waste of space. Once you get used to working in a shared environment you will discover there are more positives than negatives. That’s why they are the norm in Europe and Asia.
"Upzone the neighborhood where I want to live but downzone my work space!"
"Shame selfish people who don’t use mass-transit but give me my own cube, where I can goof off on the internet all day!"
By calzada on 07.24.19 9:39am
…but what about SB50?
By LosFeliz$ean on 07.24.19 10:53am
"Things were so much better back in the day."
"Yes, before they downzoned the entire city."
"…well I didn’t mean THAT…"
By disqusted on 07.26.19 9:18am
They are trying to make LA nice. And our mayor and city council are trying to make LA as sh*tty as possible.
By LADude on 07.22.19 4:27pm
…by building places for these people to live?
The average income is $102k. That’s pretty good! But not so good you can comfortably afford a 1-bedroom in Santa Monica and student loans. So these folks push out into other, cheaper areas, raising rents, and driving their cars to work, worsening traffic.
Building new apartments in the very areas these people work is the best solution.
By Greyvagabond on 07.22.19 4:54pm
Those folks pushing out into other areas is what makes those other areas nicer. I know it hurts people’s hearts but having higher income people in a neighborhood usually results in that neighborhood becoming nicer.
By LADude on 07.22.19 5:34pm
That is absolutely true. I don’t like the misuse of the term "Gentrification."
But when we are desperately trying to reduce average vehicle miles traveled and fight climate change, locating housing near employment (or at least public transportation) is HUGELY important.
By Greyvagabond on 07.23.19 3:47pm
Guess who as the most creative minds?
By HollywoodBandB on 07.22.19 5:12pm
"The average tech worker in LA earns a salary of $104,000"
Note to self: raise your rates!
By corner soul on 07.22.19 8:06pm
keep those tech jobs coming. – we need our economy to be as diverse as possible.
By LAoneWay on 07.23.19 5:59am
so:
if one of these typical tech bros in "Silicon Beach" limits his marriage prospects to other, local tech folk (aren’t many women in this line of work, so hopefully, he’s gay), then two of these highly educated, gainfully employed young professionals making triple the city’s median household income will…
…still struggle to find an affordable home to buy where they work
that’s not healthy
By JohnnyBlades on 07.23.19 9:22am
It’s not healthy to think you can’t live further away from work and get your ass on one of the trains, light rail, subway or rapid bus lines we are putting in. If that’s not enough for you you can go surface street which will be less congested from the non-whiners using the above and improvements in traffic flow from new tech that’s coming.
We have room in LA for tech bros who contribute to improving our quality of life, for lazy asses like you not so much.
By calzada on 07.23.19 9:41am
"i would simply fly to work from far away on one of the things that doesn’t exist yet"
-some dope
you were just asserting that "LA has never been more affordable" for people with the jobs described in this article, and then you see the math doesn’t back it up, and you handwave the numbers away with "it will all be magically fixed at some future date so the problem doesn’t exist"
idiotic
the young people doing well still aren’t thriving and the numbers show it
By JohnnyBlades on 07.23.19 10:01am
Do you understand what the word "median" means? The $104k "median tech salary" means it’s the midpoint of the distribution for all tech salaries, such that there is an equal number falling above or below. (And you have no idea about anything like their stock options).
As tech is a fairly new industry the distribution tends to be fat around the middle. I’d venture to say there are nearly as many people in tech at $130k as there are at $104k. And there will be more of these people coming so better buy now and quit complaining.
Home prices are really going to jump as the industry matures and older tech workers with kids want to move into single-family homes in or near the city. That’s when they will cash out of their stock options, income which is not captured in their current reported salary. In other words tech salaries are higher than they appear.
By calzada on 07.24.19 12:15pm
your dumb, patronizing screeds are tiresome
as clearly evidenced by this median income data, the majority of these techies cannot come anywhere close to affording the seven-figure homes near work in LA’s main tech hub. not even if a fraction of them happen to have some stock to sell off for a down payment. not even if you imagine the rare household with two such incomes
you vaguely gesture to this group as paragons of success in one breath, but when the numbers show that house prices are inflated beyond their reach…
…even the titans of your bootstraps fantasy morphed into more snowflakes that oughta commute from far away
what a clown
By JohnnyBlades on 07.24.19 7:45pm
No one starting in tech has expectations about owning a home so close to work in LA they can walk. Those starting out will not be able to afford "seven figure" homes and that’s not a problem because there are tons of homes available in the $700-750k range that are affordable, for them, and a manageable commute with all of the mass transit coming.
You try to make it sound like until homes near work drop under $1M, we have a problem. Only in your entitled YIMBY mind.
By calzada on 07.24.19 11:26pm