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Thursday, Mar 28, 2024

Real Estate Column—Conejo Valley Commercial Sale Prices Getting Steeper

Skyrocketing rental rates for office and R & D; buildings in the Conejo Valley have driven up sale prices for those properties dramatically. After inching up slowly for several years, buildings this year in the region known as the 101 Technology Corridor on average sold at prices nearly 20 percent higher than 1999, according to data compiled by Cushman Realty Corp. The price hikes were accompanied by increased interest from large, institutional investors, a group that had largely overlooked the area previously. “Typically, the market was dominated by private ownership,” said Jeff Welch, senior associate with Cushman Realty. “The institutional ownership has really taken a hard look at it.” This year, sales of such buildings as the Agoura Hills Business Park, acquired by Lowe Enterprises for $17.8 million, and Westlake Spectrum I and II, also acquired by Lowe for $18.2 million, have bumped the average price per rentable square foot for Conejo office properties to $148.89, according to the Cushman data. That compares with $124.45 per rentable square foot in 1999 and $120.55 per rentable square foot in 1998. The rise in selling prices comes as demand grows and lease rates increase. Conejo Valley vacancy rates for the third quarter of 2000 were slightly more than 6 percent, the lowest levels in the northern Los Angeles region that includes the San Fernando and Santa Clarita valleys. At the same time, lease rates for office space in Conejo have risen from an average of $1.66 per square foot in 1998 to $2.25 to $2.35 currently, according to brokerage reports. “The high rental rates are going to drive higher sale prices,” said Welch. “We only see the (sale price) number going up due to higher quality buildings and higher rental rates.” Shopping Center Sale Pan Pacific Retail Properties Inc. has acquired the Granary Square Shopping Center in Valencia for $18.3 million. The 136,924-square-foot center, which houses a Ralphs, Long’s Drugs and Washington Mutual bank branch, is east of Interstate 5 at McBean Parkway. It is about 90-percent occupied. The sellers, MRES America Fund 88-II, a division of Mitsui, received about 20 offers on the center, according to David Elliott, a broker with Charles Dunn Co. Inc., who represented the buyer and seller in the transaction. Dunn’s David Parker also represented the seller. Pan Pacific owns shopping centers in Nevada, Oregon, Washington and several other regions, in addition to California. The company’s Southern California properties include Canyon Square in Santa Clarita and Palmdale Shopping Center in Palmdale. Sylmar Acquisition ISU Trading Inc., a manufacturer of electronics, has acquired a Sylmar building to relocate its domestic headquarters. ISU purchased the 56,485-square-foot building at 12930 Bradley Ave. for $4.1 million. The company, which has been based in mid-Wilshire, will house manufacturing and distribution as well as offices at the new location. David Young and Chad Gahr at NAI Capital Commercial represented the buyer. Greg Geraci and David Harding at CB Richard Ellis Inc. represented the seller, Charles Sweetman. Calabasas Welcomes Spirent Rapidly expanding Spirent Communications has signed a lease for an 83,000-square-foot build-to-suit facility at Calabasas Lost Hills Business Center. The site, part of a 30-acre parcel developed by the lessor, Cypress Land Co., is one of only two remaining parcels in the 162-acre business park. Other tenants include Cheesecake Factory, Alcatel and Pipp Printing. The 10-year lease is valued at $13.5 million. Telecommunications company Spirent also occupies a 107,169-square-foot facility at 26750 Agoura Road, which the company leased in January 1999. Mike Tingus, John DeGrinis and Mike Fowler at Colliers Seeley International Inc. represented the tenant and Cypress. Valencia Construction Investment Development Services Inc. has begun construction of the third phase of the 50-acre Vista Business Park in Valencia. The $13-million project entails a 206,000-square-foot industrial building in the 28000 block of Williams Avenue. The center’s major tenant is Pharmavite, which has leased 740,000 square feet in the complex. Jim Linn and Nigel Stout, brokers with Grubb & Ellis, are marketing the facility. Studio City Attraction Two new tenants have signed onto a newly renovated office building at 10960 Ventura Blvd. in Studio City, bringing the property to full occupancy. SFX Tollin Robbins Inc., the sports division of SFX Entertainment, signed a lease for 6,250 square feet for offices and production. Media Distributors, an equipment distributor for the entertainment industry, has leased 6,100 square feet in the building. Prior to the renovation, the building had been a dance studio. Building owner Al Radi was represented by Cathy Scullin and Chad Gahr of NAI Capital Commercial. Stacey Vierheilig of Charles Dunn Co. represented SFX. Angie Weber of Daum Commercial Real Estate Services represented Media Distributors. Van Nuys Lease Retailer Mill Oak & Pine Furniture Co. leased a 21,516-square-foot commercial building in Van Nuys for a new store location. The facility, at 7635 Sepulveda Blvd., also includes about 1,000 square feet of office space and a furniture warehouse. The new store opened Nov. 12. Pomona-based Mill Oak was represented by Stu Leibsohn of Delphi Business Properties. Retail Action Calabasas Auto Center has signed two tenants for its 8,000-square-foot facility. Falcon Crest Tire & Service will open a Goodyear Tire and Auto Repair shop in a 4,687-square-foot space. Texaco Xpress will occupy a 3,000-square-foot facility. Joe Lopez, a broker with Westcord Commercial Real Estate Services, represented the Auto Center. Staff reporter Shelly Garcia can be reached at (818) 676-1750, ext. 14 or by e-mail at [email protected].

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