Ritz Residences (Credit: Wikimedia Commons, Pixabay)
As Los Angeles grapples with a severe affordable housing crisis, a new study shows condo and loft sales remain strong.
There were roughly 353 condo and loft sales in the region in 2017, up 40 percent from 2016, according to the most recent report from Loftway, a brokerage specializing in loft sales and leases. That’s due in part to the opening of the much-awaited Metropolis Tower 1 and 1050 Grand, which sold 13 and 39 units, respectively. Despite somewhat discounted prices, Luma South and Market Lofts also added to the tally, selling upwards of 25 units each last year.
Prices in DTLA continued to increase, rising almost 4.5 percent year-over-year to $697 per square foot. That’s a more modest jump than last year, which saw prices rise up by 11 percent.
The Biscuit Co. Lofts at 1850 Industrial Avenue in the Arts District saw the greatest jump in prices. Four units at the redeveloped condo sold at $1,068 per square foot, well above last year’s $804 per square foot.
Meanwhile, the number of units leased in the area increased by nearly one quarter to 440 units in 2017, from 369 the year before. But a majority of the buildings saw their rents drop, with the Biscuit Lofts, Alta Lofts and Beacon experiencing the greatest dips, according to the report. At the Biscuit Lofts, rents dropped from $4.63 per square foot to $3.49 per square foot.
DTLA, which has been home to a flurry of new construction, has been the topic of much concern as industry leaders fear supply is outstripping demand. The deliveries of such luxury projects, like Metropolis, have increased competition in the area, likely causing a downturn effect on prices, the report showed.
It was a different story at the Ritz Residences, where sales rates clocked in at about $1,083 per square foot last year, tops on the list. The L.A. Live complex also took home the gold for the priciest sale of the year with a condo that had a $9.13 million price tag.
Third on the priciest list was Greenland USA’s $1 billion Metropolis, which completed its 308-unit Tower 1 in 2017. Only 13 apartments sold, however, at roughly $1,054 per square foot. That may be the reason why Douglas Elliman lost the project last year in an agency shakeup, industry experts have speculated. Local brokerage the Agency is now handling Tower 1 sales, as well as the 514 residences under construction at Tower 2.
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