Real Estate

Brookfield's Beaudry DTLA Offers Up to 8 Weeks Free Rent, $500 Apple Card

Brookfield's Beaudry DTLA faces leasing challenges, offering substantial concessions in a competitive luxury market with over 70% occupancy.

By Doug Elli

4/3, 17:04 EDT
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Key Takeaway

  • Brookfield's Beaudry DTLA offers exceptional perks, including up to 8 weeks free rent and a $500 Apple gift card, to attract tenants.
  • Despite these efforts, the luxury tower is just over 70% leased, reflecting broader challenges in the Downtown L.A. luxury rental market.
  • Concessions are becoming common among DTLA luxury apartments amid a vacancy rate improvement from 17% last year to 13%.

Downtown LA's Luxury Leasing Challenge

In the heart of Downtown Los Angeles (DTLA), Brookfield Properties' Beaudry DTLA apartment tower stands as a testament to the city's post-pandemic recovery efforts. This 64-story luxury high-rise, boasting 785 units, not only enhances the city's skyline but also marks Brookfield's significant footprint in the residential market of DTLA. Despite its grandeur and the allure of luxury living, Beaudry faces a leasing challenge, resorting to substantial concessions to attract tenants. A year into its opening, the tower's occupancy hovers just over 70 percent, with promotions including eight weeks of free rent and other enticing offers. This scenario is reflective of a broader trend across DTLA's luxury apartment market, where concessions have become increasingly common among high-end residential towers.

The Concessions Trend in DTLA

The luxury apartment market in Downtown LA is experiencing a notable shift, with developers and property managers offering significant concessions to fill vacancies. Beaudry's strategy includes not only weeks of free rent but also unique perks like a $500 Apple gift card and three months of free valet services. Comparable buildings in the vicinity, such as TENTEN Downtown and THEA at Metropolis, are also offering up to 10 weeks of free rent. These concessions highlight the competitive landscape of the luxury rental market in DTLA, where a surplus of high-end units is driving property managers to go above and beyond to attract tenants. Despite these efforts, the vacancy rate for luxury residential units in DTLA stands at 13 percent, a slight improvement from the previous year but still higher than pre-pandemic levels.

A Shift Towards Luxury Living

Amidst the challenges faced by luxury apartment complexes in DTLA, there's a growing trend of renters gravitating towards high-end living spaces. According to CoStar News, the demand for four- and five-star apartments in Los Angeles has led to a decrease in vacancies from 10 percent last summer to 8.6 percent. This shift is in stark contrast to national trends, where vacancies in similar luxury apartments have risen due to new constructions. The preference for luxury living in LA is further supported by the signing of 8,300 leases for high-end properties in the past year, showcasing a robust demand despite the overall market dynamics.

The Dichotomy of LA's Rental Market

The increasing demand for luxury apartments in Los Angeles highlights a growing divide in the city's rental market. While high-end properties see a surge in interest, lower-end apartments face negative demand, with significant vacancies and a lack of interest from renters. This dichotomy underscores the challenges of housing affordability in LA, where lower and middle-income residents are pushed to the outskirts in search of more affordable living options. The rebound in average asking rents in Los Angeles, following a four-month decline, indicates a recovering rental market, albeit one that favors luxury and high-end living spaces.

Street Views

  • Neema Ahadian, Marcus & Millichap (Neutral on Downtown L.A. luxury apartment market):

    "Beaudry’s concession offering tenants three months of free valet parking could be an “advantage” and “help lure tenants there faster than comparable buildings nearby.”" "About 13 percent of luxury residential units in Downtown Los Angeles are currently vacant... Still not ideal but progressing towards normal rates for core L.A."

  • Tyler Neale, Sotheby’s International Realty (Neutral on Brookfield's concessions):

    "Brookfield’s concessions 'sound pretty exceptional, even in this climate.'"

Management Quotes

  • Scott Gonzalez, leasing agent at Brookfield Properties:

    "We do offer additional promotions even if you don’t do a 16-month lease, so if you choose to do a 12-month, we offer one month."