Another strong year for the commercial real estate market in Los Angeles County lifted the fortunes of the architecture and commercial interior design sector.
The largest architecture firms’ local billings increased 4.9 percent to $846.7 million in 2017, while commercial interior design firms saw a 2.4 percent hike to $189.9 million.
Gensler topped the list of architectural firms again, growing its Los Angeles County billings by 6 percent to $90.3 million. Its number of Los Angeles-based architects rose to 141 in 2017, up 10 architects from the previous year. The number of employees at its Los Angeles office rose by seven workers to 337 overall.
Gensler also topped the list of commercial interior design firms, growing local billings by 2 percent to $42.5 million and increasing its staff by nine employees to a team of 159 workers.
The company’s projects include AltaSea, a marine science, business and technology incubator at the Port of Los Angeles in San Pedro, the renovation of the Herald-Examiner Building downtown, and the Banc of California Stadium, home of the Los Angeles Football Club, which is slated to start playing next to the Los Angeles Memorial Coliseum in March.
The key to its continued success locally is to be as diverse as the economy it serves, according to Michael White, a managing director at Gensler.
That diversity extends into its commercial interior design work. A prime example is Netflix Inc.’s 92,000 square feet of office space just off the 101 freeway in Hollywood at 5800 Sunset Blvd. The property’s owner, Hudson Pacific Properties, hired Gensler to design the building. Netflix then hired Gensler to design the interior space.
The market has been so strong that the usual slowdown for the holidays in December didn’t materialize this year, White said.
“We’ve seen a lot of continued activity,” White said. “We’re very optimistic that things will continue to be busy.”
ZGF Architects, with projects at Cedars-Sinai and California Institute of Technology, remained in the number two position on the architect list, growing its local billings by 14.2 percent to $44.8 million. It also increased architects to 42 in 2017, two more than the previous year. The downtown-based company climbed three spots among commercial interior design firms, increasing billings 17.2 percent to $9.5 million.
No. 3 on the list, Aecom, grew local billings by 17 percent to $40.7 million for its architectural unit, jumping up four spots in the list. A significant portion of that growth came from entertainment clients, according to Robert Lavy, a Los Angeles-based vice president and regional managing principal at Aecom.
The company’s entertainment section grew in the large double digits, perhaps as much as 50 percent, he said, with 30 percent growth forecast for that Aecom sector this year.
Among Aecom’s clients are Comcast subsidiary NBCUniversal, LA 2028 Olympic Committee, Los Angeles International Airport and the U.S. Navy.
A strong economy, low unemployment rate and the recent reductions in corporate tax rates are casting a bullish outlook on capital improvements, Lavy said.
“Most of the clients that we’re having a chance to work with, they’re all moving forward with capital plans,” Lavy said. “We’re seeing a strong push on the tech sector, across all paths here in L.A., but also firmwide,” he noted, with Oracle listed as one of Aecom’s tech clients.
CallisonRTKL slipped one spot to fourth, and DLR Group rose one spot in the rankings to round out the top five, thanks to a 1.7 percent increase in local billings to $36.4 million.
HNTB Architecture grew its local billings by two-thirds to $25 million thanks to its work on the Sixth Street Viaduct Replacement in downtown, the Crenshaw/LAX Transit Corridor and the United Airlines terminals at Los Angeles International Airport.
Santa Monica-based HBA/Hirsch Bedner Associates came in second among commercial interior design firms with $21 million in local billings, a 30 percent year-over-year increase. The opening of downtown’s Hotel Indigo was a highlight for the firm last year
“We have been blessed with a good local market,” said HBA Chief Executive Rene Gross Kaerslov. “We haven’t seen such a centralized hotel boom since the Beijing Olympics.”