Commercial Revenue Trends Under Measure ULA
The City of Los Angeles has released updated revenue data from Measure ULA, shedding light on its impact on the commercial property sector.
What You Need to Know
As a reminder, Measure ULA taxes large sales of commercial and residential properties over $5 million. However, it’s not just impacting the wealthy—it’s also affecting smaller properties, including small apartment buildings and local "mom-and-pop" businesses.
Key insights include:
- Commercial properties bring in a large share of revenue, mainly from transactions in two price ranges: $5.15–$10.3 million and over $10.3 million. Examples of big sales include $1.62 million (August 2024, District 10), $4.84 million (September 2024, District 15), and $3.03 million (November 2024, District 15).
- Most commercial property sales are in areas like Districts 5, 10, 14 and 15.
- Commercial property sales stayed steady from May 2023 to November 2024, with no big drops in activity during any season.
- Commercial properties contribute a lot to overall revenue. For example, in August 2024, two key sales included $1.63 million (District 10) and $735,000 (District 14).
It’s still important to note that supporters of Measure ULA thought it would bring in $900 million every year for building affordable housing. However, it's only made $181.6 million in its first year.
How It Impacts You
The ULA ordinance imposes transfer taxes on high-value properties, adding costs for buyers and sellers.
Property managers should factor these taxes into their financial planning to ensure smooth transactions and prepare for potential policy changes that could affect local budgets and services.
Looking Ahead
Although the Taxpayer Protection and Government Accountability Act (TPA), which sought to strengthen taxpayer protections, did not succeed, other initiatives are moving forward.
BOMA International is developing a national report to examine how transfer taxes, such as Measure ULA, affect local markets and government revenue.
Follow BOMA on the Frontline for more Measure ULA news.
