Key Considerations When Subleasing Commercial Space in Southern California

Subleasing can be a strategic way to secure cost-effective space in Southern California’s competitive real estate market, but without careful execution, it comes with potential pitfalls. 

Whether you’re looking to downsize, test a new location, or share a larger space, secondary lease agreements present both opportunities and challenges. A thorough comprehension of the mechanics, benefits, and key considerations of these agreements for both tenants and landlords is essential to ensuring a smooth and legally sound arrangement, one that is financially advantageous to all parties involved.

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What Should Industrial and Commercial Tenants Consider Before Renewing Their Lease in Southern California?

In Southern California’s competitive markets, lease renewal is a critical decision that can shape your business’s future. With fluctuating lease rates, evolving submarkets, and shifting business needs, it’s crucial to weigh whether staying or relocating aligns with your long-term goals. 

The region's unique dynamics—ranging from urban centers like Downtown Los Angeles, known for its bustling commercial environment, to business-focused areas like Torrance, with its skilled workforce and growing tech scene—are just a few examples of the many possibilities across Southern California.

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How the Measure ULA Tax Affects Commercial Real Estate in Los Angeles

Measure ULA, commonly known as the 'mansion tax,' is significantly altering the economics of commercial real estate transactions in Los Angeles. While framed as a luxury residential tax, its implications reach far beyond that, creating new cost structures for institutional investors, REITs, and private capital. 

Transactions exceeding $5 million are now subject to additional transfer costs, reshaping acquisition strategies, pricing models, and capital deployment. The commercial sector is already adapting, with deal structures, underwriting approaches, and market liquidity shifting in response to this regulatory overhang.

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