The effects of e-sports are expected to continue to ripple out through L.A.’s economy as investments by team owners, league operators and game studios fuel demand for real estate, according to a recent report by CBRE Group Inc.
It’s a continuation of a trend that caught eyes last year when Blizzard Entertainment Inc., a unit of Activision Blizzard Inc. in Santa Monica, built out roughly 50,000 square feet of broadcast studio space in Burbank, opening a 450-seat arena at the former site of “The Tonight Show.”
Riot Games, maker of the popular “League of Legends,” occupies nearly half a million square feet on Olympic Boulevard on the Westside.
EA Sports occupies 122,000 square feet of office space in Playa Vista.
E-sports competitions already fill up arenas such as Staples Center and New York’s Madison Square Garden, according to CBRE. Continued growth in the popularity of the sport is likely to generate more media coverage, and that will boost demand for broadcast studios and live event arenas, CBRE predicts.
Other related businesses will likely grow, such as game console manufacturers, virtual reality technology and training facilities, the study said.
Petra Durnin, a CBRE research analyst who along with David Nusbaum authored the report, told the Business Journal that e-sports companies already hungry for real estate “need spaces where they can build rather than taking over something that exists already.”
AHF’s Emphasis
The nonprofit AIDS Healthcare Foundation is taking an aggressive approach to combat the city’s homelessness by purchasing hotels for conversion to transitional housing.
AHF spent $8-plus million last year to purchase the Madison Hotel, a 220 single-room-occupancy building at 423 E. 7th St. in downtown Los Angeles. The foundation also recently acquired the 27-room former Sunset 8 Motel at 6516 Sunset Blvd. in Hollywood for $4.6 million.
AHF said it plans to convert the buildings for low-income families and individuals, with priority given to people with chronic health conditions.
Los Angeles city voters approved Proposition HHH in November 2016, authorizing $1.2 billion in bonds to pay for the construction of 10,000 units of housing designated for the homeless.
County voters approved Measure H, a quarter-cent sales tax that will raise an estimated $3.5 billion over 10 years to combat homelessness, in March 2017.
It took until December 2017 for the first project under the city program – an East Hollywood property of 122 new units – to break ground. The slow pace has been due in part to complaints from property owners and residents who don’t want such housing in their neighborhoods. The Los Angeles City Council’s planning and land use management committee last year blocked plans for a $23 million, 49-unit homeless housing development in Boyle Heights after it drew neighborhood opposition.
Michael Weinstein, AHF president, said AHF’s real estate purchases have two purposes: “To house people immediately, and to tell the city to get its act together” (see related Commentary, page 36).
Extension in Torrance
Virco Manufacturing Corp. is staying in Torrance for at least another five years after renewing its lease nearly two years early in a sign of ongoing industrial space tightness.
The furniture and equipment maker for educational facilities signed a five-year extension for 559,000 square feet at 2027 Harpers Way since 2005.
Klabin Co./CORFAC International represented Virco and building owner, San Francisco-based Prologis.
The county’s fourth-quarter industrial vacancy rate remained tight at 1.3 percent, according to Jones Lang LaSalle Inc.
Staff reporter Ciaran McEvoy can be reached at [email protected] or (323) 556-8337.
