In the blink of an eye, it seems, most of the properties in the Warner Center area have new landlords or will soon. Warner Center Properties, a 2.3-million-square-foot complex of offices that comprise the cornerstone of the business center, is reported to be on the block. In recent weeks, Tishman International Co.’s 21st Century Plaza, twin towers with 517,00 square feet of space, has been acquired by Bentley Forbes Group, a privately held real estate investment company. Warner Center Corporate Center, a 253,000-square-foot building formerly owned by Nomura Real Estate, sold to Grosvenor, a British real estate investor. And several years back, the 35-acre Prudential Insurance of America office complex, since renamed LNR Warner Center, sold to Lennar Partners. In the current market, it’s easy to see why landlords might be interested in divesting. Warner Center lease rates in the past several years have jumped about 35 percent or more in some cases and, with the current slowdown underway, are now leveling out. Less apparent is what’s in it for the buyers, given the same market dynamics. But what the current acquisition activity shows is the long term value buyers are placing on the Warner Center area, despite the recent downturn in leasing activity, say brokers and others familiar with the area. “It does support that it is a very strong, desirable office market, which maybe confirms what most of us knew anyway,” said William R. Boyd Jr., senior vice president with Grubb & Ellis Co. “But when institutional ownerships pursue a market, it’s a further validation that the market is strong and the prospects are good for the future. This latest spate of acquisitions will place Warner Center squarely in its third generation of ownership, a sign that the Warner Center market has evolved into a stable, long-term real estate investment. Warner Center Properties, owned by a joint venture between Alaska Permanent Fund Corp. and Harvard University’s endowment fund, will likely be acquired by another institutional investor or real estate investment trust. And Warner Corporate Center and 21st Century Plaza are also in the hands of professional investment companies. Only LNR Warner Center is owned by a development company, although it too is a division of a large, publicly held real estate firm. “The first generation was speculative,” said Larry Kosmont, president of real estate consultancy Kosmont Partners. “The second was probably less speculative and a little more institutional. The third is looking at an area that’s stabilized. They’re saying they like this area and it’s worth the investment because they get a good stabilized return that’s not risky.” The newest owners will probably not see any increases in the value of their investments for some time some estimate it may be another 18 months before rents resume their upward climb. But so far at least, Warner Center has retained its value, in some cases to a greater degree than the pricier Westside L.A. real estate. And the community’s diverse tenant mix, coupled with its proximity to the growing 101 Tech Corridor suggest that it is well positioned once the market swings upward again. “Where you had a lot of businesses on the Westside go out of business, you haven’t seen that here,” said Brad Rosenheim, a principal with Rosenheim & Associates, which represents the Warner Center Association of business tenants. “That may have demonstrated that this area is more solid. There’s no guarantee, but Warner Center has weathered this downturn fairly well. Plus the 101 Corridor has a lot of potential, and I think its location at the east end (of the corridor) makes Warner Center an anchor for that.” Westlake Leases Four new tenants are getting ready to move into Plaza Center III, the 81,500-square-foot office building nearing completion in Westlake Village. Law firm Jackson, DeMarco & Peckenpaugh has leased 12,000 square feet of office space in the building in a five-year deal valued at about $2 million. Stowell, Zeilenga & Ruth LLP, another law firm, has leased 5,200 square feet in a five-year deal valued at $1 million. The two other tenants that will locate in the building are American Title Co., which has taken 2,789 square feet, and Cost View Capital, which has taken 2,500 square feet. A Shot in the Arm There’s apparently no recession for health care. Public managed care companies are reporting strong second quarters, and medical practice groups are continuing to rent real estate. Facey Medical Foundation, a Mission Hills-based group, has leased an 8,867-square-foot medical office in Seco Canyon Plaza, a retail center under construction in Santa Clarita. Facey’s 11-year lease is valued at $2.7 million. The 23,497-square-foot retail complex, slated for completion in December, will also house Kindercare, Starbucks and Coldstone Creamery. Joel Frank, a broker with First Property Realty, represented the tenant. The landlord, Hopkins Real Estate Group, was represented by Ray Bayat, Bert Abel, Mitch Bayat and John Cserkuti of Grubb & Ellis Co. In another deal for medical space, Oxnard/Simi Ear, Nose and Throat Medical Group leased 4,241 square feet of space at 301 S. Moorpark Road in Thousand Oaks. The group, relocating from a smaller facility in Thousand Oaks, also has offices in Simi Valley and Oxnard. Marc Riches, Cheryl Richmond and Cory Richmond, all with NAI Capital Commercial, represented the tenant and the landlord, Los Robles Office Partners LLC. More Simi Homes Cabrillo Economic Development Corp. has acquired 3.72 acres from D & E; Corp. with plans to build a residential development. Cabrillo acquired the land on Kuehner Drive in Simi Valley in order to construct 26 single-family homes. The purchase price was $875,000. Gary Seaton of NAI Capital Commercial represented Cabrillo. The seller was represented by Fred Priebe of Re/Max Professional. Senior reporter Shelly Garcia can be reached at (818) 676-1750, ext. 14, or by e-mail at .
