LA County Bucks National Trend With Wave Of New Apartment Construction

By: Bianca Barragan

​New Apartment Construction in Greater Los Angeles is Heating Up – and Bucking Nationwide Perceptions in the Process

Developers started work on more than 4,000 units in the first quarter, the most construction starts in the area since the end of 2022, according to new Colliers data. The surge in SoCal reflects a departure from national trends, which show a pullback in new construction amid softening rent growth.

It also reveals the fact that although California, and particularly Los Angeles, has gained a reputation on the national stage for an unfriendly business climate, there are still developers ready and willing to invest in the area.

Like the rest of the country, Los Angeles County was awash in new construction in 2024 and 2025, resulting in a construction pipeline of more than 26,000 units by the beginning of the latter year. That number ticked down to around 24,000, but while developers slowed their activity in other regions to allow the supply to be absorbed, they are gearing back up in LA County.

The number of LA-area apartment starts in the first quarter was roughly twice what it was a year ago, by Colliers’ count, jumping from 2,000 units to 4,000, according to Colliers. Colliers tracks multifamily activity across greater Los Angeles, including submarkets outside city limits.

Nationwide, the number of starts was up just 20% annually in March, according to the Census Bureau.

Multifamily operators nationwide have slowed their pace after delivering an estimated 600,000 units in 2024. That supply glut, much of which was concentrated in the Sun Belt, collided with slowing job growth and macroeconomic strife.

In the two years following Measure ULA’s effective date, commercial transactions in Los Angeles dropped between 30% and 50%, according to UCLA. Backers of the measure say the slowdown had more to do with the commercial real estate industry waiting to see if the measure would be overturned than a meaningful representation of a drop in interest.

Greater Los Angeles’ position as an outlier to the national multifamily construction trend also means that would-be buyers coming to the market are disappointed by the property values they find in the area.

There are lots of new entrants to the LA-area multifamily market, but those buyers aren’t necessarily submitting winning bids or even making offers, according to Newmark Vice Chair Dean Zander.

Investment volume in LA-area apartments was roughly flat at $8B for the last two years, compared to $12B in 2021 and 2022, according to Newmark.

“Investors from other states are coming here to kick the tires and see where the values are, but they're generally not executing … because we just don't have those fire sale opportunities that other places might,” Zander said.

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