Apartment rental rates in the San Fernando Valley rose an average 5.1 percent in the fourth quarter of 2005 versus 2004, according to data released by RealFacts, a Novato-based research service. The average rental unit in the Valley leased for $1,442 compared to $1,372 in the fourth quarter of 2004. The highest rate of increase, 10.9 percent, was seen for junior one-bedroom units which averaged $1,158 per month. Two-bedroom, one-bath units also outpaced the Valley average. Rents for those units rose by 6.1 percent in the period. Studio City bucked the general trend, seeing its rents decrease in the year-to-year period. In Studio City average rents fell 5.5 percent to $1,560 per month. The steepest rent increases came in Woodland Hills, where rents rose an average 8.3 percent to $1,572 in the period, presumably the result of new properties that have come onto the market. Rents at Valley apartment complexes have risen nearly 20 percent over the past four years, RealFacts said. The rental rate increases come as vacancy rates maintain their record low levels. In the Valley overall, occupancy rates were 95.6 percent in the fourth quarter of 2005, down a hair from levels of 96.6 percent in the third quarter, and up a hair from the same period a year ago when occupancy rates were 95.4 percent. Office Tighter Than Ever Office absorption rates in the San Fernando Valley in 2005 beat the average rate of absorption over that’s occurred over several decades, totaling 1.1 million square feet, according to a just-released market report from Colliers International. Colliers said that the annual average in the area since 1980 has been about 875,000 square feet. Vacancy rates in the Valley overall were 9.1 percent for the fourth quarter of 2005, down from 9.6 percent in the prior quarter and from 11.3 percent a year ago, and the rates in some submarkets were lower still. The Colliers data showed total vacancy levels in the Central Valley at 7.5 percent and in the East Valley at 6.1 percent. “The market shifted in 2005 from a tenant’s market to one more balanced between tenant and landlord requirements,” the report said, a somewhat euphemistic way of saying tenants can forget about free rent and tenant improvements, demand is beginning to outpace supply after several years where office space was plentiful. The situation is not likely to change anytime soon, provided the economy continues at current levels. The Colliers report revealed that there were only 209,600 square feet of office space added in the region in the past three months, and only 219,000 square feet of space is under construction currently. Some 2.7 million square feet of office space is currently planned, although the number represents some projects that have yet to receive entitlements or funding. Of that, the largest amount of construction, 1.2 million square feet, is planned in the Conejo Valley. Asking rents have risen commensurate with the space shortages. The average asking rental rate at the end of the fourth quarter was $2.13 per square foot, up from $2.07 a year ago. Rates were highest in Conejo Valley were they averaged $2.20 per square foot. The lowest rates in the quarter were in the West Ventura County area where asking rents averaged $1.89 per square foot. “Rental rates should generally move upward at a moderate to strong pace over the next one to two quarters, and then climb even more sharply as vacancy rates drop below 8 percent,” the report stated. North Hollywood Sale A 54,080-square-foot office building in North Hollywood has sold for $9 million. The property, at 4142-4146 Lankershim Blvd., was acquired by L & S; Realty Group. It is fully leased. Stacy Vierheilig-Fraser, a broker with Charles Dunn Co., represented the buyer and seller, D-Mark Holdings. Agoura Sale A 25,000-square-foot office building in Agoura Hills was sold to an investor for $6.5 million. The property, at 27489 Agoura Road, includes three additional acres of land, which the buyer expects to develop into office or medical condominiums in the future. Marc Spellman and Mark Leonard, brokers with Lee & Associates L.A. North/Ventura, represented both the buyer and the seller, Cardinal Liberty Inc. Vitesse in Leaseback Deal Vitesse Semiconductor Corp. has divested the Camarillo property that houses its operation and will lease the building back from the new owners. The 50,454-square-foot industrial building, at 4721 Calle Carga, sold for $6 million to Titan Real Estate Investment Group. It was constructed in 1985 and is located on a 4.28-acre parcel. Titan is a real estate investment group that focuses on commercial and multifamily properties. Its portfolio includes 4 million square feet of commercial assets and 3,591 units of multifamily assets. Industrial Deal in Simi Vista Outdoor Lighting has acquired an industrial building in Simi Valley for $2.8 million. The 22,716-square-foot facility, at 1890 Voyager Ave., will house the company’s expanding manufacturing operation. Vista already owns two buildings in the area. Dennis Marciniak, a broker with GVA Daum, represented Vista and the seller Kha LLC. The current tenant of the building, Knurr Inc., is relocated to a 28,669-square-foot facility at 20740 Plummer St. in Chatsworth. That transaction was handled by Marciniak along with Daum’s Stuart Scott. Scott Caswell, a broker with Delphi Business Properties, represented the landlords Heller Family Trust and Grey Family Trust. Business Park Underway Overton Moore Properties has begun construction on Northridge Business Centre, a 167,000-square-foot industrial project. The center will include 16 condominium units ranging from 8,600 square feet to 13,600 square feet available for sale or lease. The anticipated date of completion is July, 2006. Bennett Robinson, a broker with CB Richard Ellis, is marketing the property.
