Los Angeles' Office Market: Four Months Later

Towards the end of June, this blog picked up on a story regarding the future of the LA office market. The story, citing a UCLA study, indicated that demand was to outpace supply all the way through 2010. The trend is culminating quicker than anticipated:

"Today the numbers that commercial developers watch are encouraging them. Downtown vacancy rates are dropping and rents are heading upward, new statistics show. Landlords say they are bullish unless a swift downturn in the economy is ahead."

"As the office market tightens across much of Los Angeles County, according to recent statistics, some of the biggest downtown landlords are raising rents -- something almost unheard of three years ago."

"Rents downtown will go up 4% to 5% by the end of the year, predicted Bill Flaherty, a senior vice president at Maguire Properties, which owns the most downtown office space."

Ding Ding Ding...Is Maguire a buy? In June, the feeling was to hold off. Since then, Maguire Properties stock price has fallen 22.5 percent. A company that was trading at $34.82 on June 19th, closed trading today at $26.97.

The fence: it's still being used...Maguire: neither buy, nor sell. Check for updates.

Links Worth Mentioning...

The Dow Remembers. To celebrate the twenty year anniversary of the Black Monday crash, the Dow shed 366 points.

Are there big things happening at Maguire Properties?

Housing starts: things will get worse.

Halo 3 is the video game barometer. Sales blow away forecasts.

Will natural resources become the biggest boom ever?

Citing too much speculation, Barron's Online offers the possibility of an oil crash.

Torre to Steinbrenner: NO! Good for Joe!

In California, Napa Valley doesn't hold a candle to Humboldt.

More from California: Schwarzenegger intends to privatize the state lottery.

Links Worth Mentioning...

Henry Paulson finally admits two things about the housing market:
(1) It poses a threat to the greater economy, and (2) It's not done unfolding.

Paulson also declares that there will be no bailout for the lenders or property speculators.

Freezing ARM rates wouldn't be a bandaid; it'd be a series of stitches that could stop the bleeding...at least for a while. Obviously, it's not good for business. Should that matter?

In a story related to real estate, homebuilder confidence is at a NEW all time low.

Speaking of homebuilders, orders for new homes plunged 39 percent for DR Horton.

Are US consumers completely tapped out?? That would be disastrous given our current situation. I heard somewhere that consumerism accounts for two-thirds of the US economy. Scary.

Dow 22,000...the result of a devalued dollar??

Q and A for a weak dollar.

Crude tops records. Is retail gas soon to follow?

Market Rally: Deniabull

Bloomberg is reporting that homebuilders could be a buy now:

"Lennar Corp. and D.R. Horton Inc., the two biggest U.S. homebuilders, advanced after Citigroup Inc. said the industry's 50 percent decline this year has made the stocks attractive. Citigroup led financial shares higher after the largest U.S. bank said it expects 'a normal earnings environment' in the fourth quarter and former Federal Reserve Chairman Alan Greenspan said the credit slump may be ending."

Homebuilders are not buys right now. Not with this.

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In the same day that Citigroup announces possible drops in future profits, the stock market surges with hopes that the credit crisis is over. Compare that with this:

"...the banks need to step into the confessional box and tell us just how much of the $2 Trillion drop in the value of US housing (so far) they are on the hook for. So far we’ve had a Billion here, a Billion there but the big boys have so far had their heads firmly in the sand and that means it’s time for a kick in the ass."

Ostriches, bulls...two names for the same animal? Currently, it seems that way.