New LA Multifamily Deliveries Pressure Occupancy
New multifamily supply is slowing in Los Angeles — but clearly not enough to keep occupancy levels flat. In Colliers' second-quarter report on the market, occupancy dropped by 80 basis points to 93.9 percent. The Downtown/Central and the Hollywood/Mid-Wilshire submarkets hosted the lowest rates, at 91.8 percent and 91.9 percent, respectively.
That came as deliveries fell to 2,206 units at the end of June, compared with 3,137 in the previous three months and 2,781 in the second quarter of 2025.
"Sustained new supply continues to pressure the market," Colliers admitted in its report.
More than 58,800 new multifamily units have come online in Los Angeles County since the first quarter of 2021.
In addition to occupancy, rents were also sluggish in the market, with units averaging $2,442 in the second quarter, down 0.7 percent year-over-year.
On the bright side, absorption remained positive and steady at 1,737 units compared with 1,858 units posted in the same period in the year prior.
Also, Los Angeles saw no shortage of investment activity. Sales volume in the year-to-date through June surged by 47 percent to $1.58 billion. However, the average price per unit ($394,867) did fall by 4.7 percent — indicating deal sizes were smaller.
While new supply put pressure on fundamentals in the second quarter, construction is declining, with just 23,752 units underway compared to 26,478 at the end of the second quarter of 2025. Plus, just 666 units broke the ground in the second quarter of 2026, which is a "sharp drop from the 4,599 starts recorded in Q1 2026."
Source: GlobeSt/ALM