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Friday, Jun 9, 2023

Real Estate Engagement Needed in Planning for Future

Readers of this column may be pleased to learn that real estate has finally landed on the radar screen of what you might call the organized business community the folks who attend meetings and sit on committees for groups like the Valley Industry & Commerce Association and the Economic Alliance of the San Fernando Valley. Real estate was a big topic of discussion at a recent Info Summit 2004 put on by the Economic Alliance and its offshoot, the Mulholland Institute, a think tank convened to work on issues having to do with the economic future of the Valley. In addition to the need for housing, the real estate discussion centered around the imbalance between the supply of industrial facilities in the Valley and the demand for these properties, something real estate brokers have been grappling with for some time. To make a long presentation short, the Institute offered up this idea: that around the Valley, and particularly in the Northeast, there are opportunities to build centers of commerce with light manufacturing industrial space in areas where there are now aging manufacturing facilities or non-operating gravel pits and landfills. These new facilities would offer attractive sites for new businesses, expansion opportunities for existing businesses and jobs for those who most need them, the argument goes. What’s needed, the presenters said, is leadership with vision and, perhaps, the involvement of the Los Angeles Community Redevelopment Agency, which could, in this scenario, underwrite remediation efforts, making development projects at these sites almost turnkey and, therefore, much more attractive to developers. Bob Scott, the director of the Mulholland Institute, is the first to admit that these are musings that look out over a horizon of several decades and, in the end, it would really be up to market forces to make this vision a reality. It seems to me more than market forces stand in the way of this notion, and I’m guessing that the folks on the think tank are sufficiently removed from the day to day warfare between private enterprise, public governance and community interests to fully understand the issues. They probably never sat in on negotiations where businesses, limping along for years, demand exorbitant prices that developers could never justify for their properties. I’m guessing they don’t know what happens when a project of almost any kind is presented to a community of neighbors. They may not even be aware that the functional illiteracy rate in the Northeast Valley is so high that the kinds of employers they envision locating there may not even consider the area. (Where is the think tank for the education issues in the Valley?) The thing is there are other people who do know about these issues. Developers and brokers who are on the ground working around and through these problems every day. The trouble is, except for one or two real estate executives who participated in the think tank’s round tables, these folks were largely missing from the discussion. When I asked some of the industrial brokers who are active in the area whether they spend any time helping to inform these discussions I got the same answer. “My free time to volunteer for stuff is tapped,” Ross Thomas, a partner at Delphi Business Properties, told me. Thomas is on the board of the American Industrial Real Estate Association, but when it comes to getting involved in local issues, well, he just hasn’t done it. John DeGrinis, senior vice president at Colliers Seeley, told me pretty much the same thing. DeGrinis is actually a member of VICA. But sitting around a table isn’t very appealing to these folks. They’re action oriented, if not by nature, then by the requirements of their job if they don’t close a deal they don’t put food on the table. The trouble is that without these folks, and their colleagues, these discussions will continue to be theoretical. And, as brokers will be the first to tell you, without action, there won’t be any food on the table of the community either. Pacoima Deal A 108,000-square-foot industrial building at 12250 Montague Street in Pacoima has sold to a user for $7 million. Timely Industries, which manufactures steel door frames, acquired the building to accommodate the company’s future expansion. Timely was actually looking for a smaller property. But the building is nearby to its current facility, and the company will be able to sublease some of the space in the short term. Ross Thomas, a broker with Delphi Business Properties, represented Timely. The seller, E & E; Trust, was represented by Greg Barsamian, a broker with CB Richard Ellis. New Retailer Moves In United Grocers Cash & Carry, a wholesale division of Smart & Final Stores, has leased a 21,516-square-foot space in Van Nuys with plans to open its first Southern California store in January. United Grocers Cash & Carry has 47 stores located in Northern California, Oregon and Washington. Stu Leibsohn, a broker with Delphi Business Properties, represented the landlord, W & A; Fleisher, in the 10-year deal valued at $2 million. Matt Ceragioli, a broker with NAI Capital Commercial, represented the tenant. Senior reporter Shelly Garcia can be reached at (818) 316-3123

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