Leases  ·  Office

Quest Diagnostics Signs 200K-SF Office Renewal in LA

It was the biggest office lease for LA in the third quarter

reprints


Clinical lab firm Quest Diagnostics signed the biggest office lease in the Los Angeles area in the third quarter, according to a new report from Savills

The Fortune 500 company provided a brief moment of relief for a suffering office market when it renewed for 199,535 square feet at 8401 & 8403 Fallbrook Avenue in the West Hills area. Property records show Kennedy Wilson acquired the property from Brookfield Properties for $163 million in January 2019.

SEE ALSO: Luxury Pet Hotel K9 Resorts Opening 16K-SF Location in Dumbo

Kennedy Wilson did not immediately respond to requests for comment.

The West San Fernando Valley submarket has one of the cheapest rental rates in Greater L.A. at about $2.48 per square foot per month, while the average for the region is $3.86 per square foot, according to Savills. At 23.5 percent, its availability rate is slightly lower than Greater L.A. as a whole. 

National office occupancy is at 47.4 percent, according to Kastle’s most recent 10-city Back to Work Barometer. The occupancy for office space in Greater L.A. — which spans 221.1 million square feet — ticked up to 45 percent, according to the report.

Leasing activity in Greater L.A. was broad-based in the third quarter in contrast to the last several years, when entertainment, media and technology firms dominated leasing, per Savills. In addition, high-profile assets deemed to be in trouble are fueling speculation of distress in the office market.

Gregory Cornfield can be reached at gcornfield@commercialobserver.com.