L.A. Fires Damaged or Destroyed 374 Commercial Buildings Valued at Nearly $2B: CoStar

As fire crews make progress containing the Palisades and Eaton fires in Los Angeles County, officials are assessing how many commercial buildings have been damaged or destroyed.

In addition to tens of thousands of single family homes, approximately 374 commercial buildings totaling about 4.5 million square feet, with an estimated total value of $1.9 billion, fell within the fire perimeter, according to CoStar (CSGP). Some 143 retail and 135 multifamily properties were the most affected of the commercial buildings, followed by 49 office properties, two industrial properties and 45 unspecified buildings. 

About 1,472 commercial properties — comprising some 28 million square feet, with a cumulative estimated value of $9.8 billion — are located within both the burn areas and evacuation zones, according to new data from CoStar. There were 786 commercial properties affected by the Palisades Fire, and 704 commercial buildings affected by the Eaton Fire. The estimated value for the affected Palisades properties was significantly higher than the commercial real estate damaged in the Eaton Fire, at $7.7 billion to $2.1 billion, per CoStar. 

Retail and multifamily properties across both fires were the most affected by far, with 512 retail buildings and 480 multifamily buildings damaged, with another 271 office buildings, 35 industrial buildings, 12 hotels and 162 unspecified properties also affected. 

Most of the affected commercial buildings are within the evacuation areas, however, and not the fire perimeter itself. 

Most of the threatened retail properties by the Palisades Fire were in or near Palisades Village, a 125,000-square-foot, mixed-use district developed by billionaire and former L.A. mayoral candidate Rick Caruso, though Palisades Village ultimately survived the blaze, reportedly because private fire crews were hired to protect the district. Much of the retail and multifamily stock affected by the Eaton Fire are along Lake Drive in Altadena, between Altadena Triangle Park and New York Drive. 

About 75 percent of the multifamily buildings destroyed or damaged by the fires contained 20 units or less, Jay Lybik, CoStar’s national director of multifamily analytics, told Commercial Observer. Because of the general age of the buildings — 70 years old on average — and the fact that most of them were owned by individuals or local investors, Lybik said that many are unlikely to be rebuilt.

“L.A. was a very under-housed palace to begin with, and so the loss of these multifamily units is significant because it’s going to be next to impossible for them to be rebuilt anywhere close to the levels that they existed at before the fires,” Lybik said.

The report does not take into account single-family homes destroyed or damaged in the fires, let alone those affected within evacuation zones, which are estimated to be valued in the tens of billions of dollars. Indeed, Accuweather last week estimated that the total expense of the fires could reach upwards of $250 billion, which, if correct, would make the blazes by far the costliest natural disaster in U.S. history. 

Nick Trombola can be reached at ntrombola@commercialobserver.com.