The COVID-19 pandemic has forced some state governments to impose strict stay-at-home orders that are adversely affecting many industries. This is leading the U.S. economy into a recession that will result in very sharp declines in GDP for H1 2020 and in job losses, particularly in the retail, food & beverage and transportation sectors.
The unique nature of this downturn should result in an unusually swift recovery that could begin as early as Q3 2020. Assuming the coronavirus peaks this summer in the U.S.—mirroring China’s experience—the U.S. government’s fiscal and monetary stimulus will begin to bear fruit. This will be paired with pent-up private demand that could help the U.S. economy return to growth by year-end and drive stronger than previously expected growth in 2021.
The Greater Los Angeles (GLA) region attracted $1.04 billion of capital in Q1 2020. Volume was down approximately 23.8% from the five-year quarterly average of $1.3 billion. However, the average price per square foot rose 18.8% year over year to $209.
The average asking lease rate in GLA increased to $0.94 per sq. ft. per month. Over the last 12 months average asking lease rates grew by 7.9%, slightly above the average of 7.4% from the last five years.