SPECIAL REPORT: Landlords Suffer as Conejo Office Tenants Go Small

Vacant industrial space was nearly nonexistent in the Conejo Valley during the fourth quarter, according to data provided by Colliers International. Vacancy rates, already at 2.2 percent in the prior year’s fourth quarter, slipped even further to 0.8 percent. Pacific Properties Group Inc. of Los Angeles sold a 99,435-square-foot Camarillo warehouse for $7.5 million to Wildwood Engineering Inc. of Camarillo. The building, at 740 Calle Plano, was built in 1978 and underwent renovations in 2010. It has one tenant and was fully leased at the time of sale. Jack and Angela Schoen of Simi Valley bought a 54,000-square-foot industrial building in Moorpark for $6.76 million from Yavar Rafieha. The building, at 5155 Goldman Ave., was built in 1986 and underwent renovations in 2011. The Schoens also sold a 38,675-square-foot industrial building in Simi for $5.15 million to Rajiv Kaushal. The building, at 2175 Agate Court, was fully leased at the time of sale. A half-acre retail property at 3195 Willow Lane in Westlake Village sold to Ferrari dealership owner Mattioli Automotive Group of Beverly Hills for $2.75 million. The company plans to build a new showroom at the property. An 11,100-square-foot building at the site is slated for renovation. Selleck Development Group Inc. of Westlake Village sold a 5.7-acre lot along the 101 freeway in Agoura Hills for $6.5 million to developer Huntington Hotel Group of Irving, Texas. Huntington aims to build an extended-stay hotel and a conventional overnight hotel on the site at 29508 Roadside Drive. The situation is simple but critical – there’s just no space, said John DeGrinis, a senior executive vice president at Colliers’ office in Encino. “We have no space for these users to grow and relocate and that’s a big problem,” DeGrinis said. “There is no new supply coming on board. There’s very little land for developers to build on. People are having to drop down to the Oxnard market.” In the Simi Valley-Moorpark market, several available large buildings moved the vacancy needle up to 7.8 percent in the fourth quarter, a jump from the prior quarter’s 5.1 percent. That increase in space was largely due to the bankruptcy of the Community Marketplace in Moorpark that closed in September and its roughly 250,000-square-foot warehouse that came on the market in the fourth quarter, DeGrinis said. Other causes for the vacancy rate, DeGrinis said, were existing vacancies at three large properties. “Big, big buildings aren’t the sweet spot right now,” DeGrinis said. “The sweet spot is that 20,000 square feet to 50,000 square feet. That’s where we see most of the transactions occurring. If you’re looking for something smaller, there’s nothing to look at.” Some of his smaller sales included a 38,675-square-foot industrial building at 2175 Agate Court in Simi for $5.15 million in November and a 54,000-square-foot industrial building at 5155 Goldman Ave. in Moorpark for $6.75 million, also in November. Conejo Valley’s office market suffered a setback in the quarter as vacancy rates pushed up from the prior period. Office asking rates also experienced weak growth year to year. Vacancy rates across the eastern portion of Ventura County rose to 15.7 percent compared with 14.9 percent a year ago, and the market had a negative net absorption of 50,300 square feet. The average asking rate for leased space grew a penny to $2.23 since last year. The good news is that it was higher than the $2.19 rate from the prior quarter. Deals over the quarter included a $6.5 million sale in November of a 5.7-acre lot in Agoura Hills to developer Huntington Hotel Group of Irving, Texas, which plans to build two connecting hotels with 225 rooms. In October in Simi, Boston’s TA Realty sold two industrial buildings at 2121 and 2175 Union Place for $6.1 million, or $103 a square foot to real estate-focused private equity firm Cabot Properties Inc., also of Boston. – Carol Lawrence