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Saturday, Dec 2, 2023

School No. 13 is Unlucky for Firms

To buy a building in Panorama City for his printing and digital graphics business Kevin Berg took out loans, sold a motor home and a condominium in Hawaii. He could have operated out of the Lanark Street location as is but decided to make improvements to the interior that cost upward of $200,000. He put in a kitchen, energy efficient lighting and wheelchair accessible ramps, bathrooms and doors. The building had been part of Berg’s long-term goal of income-generating property for his retirement years. “We put every last nickel we had into it,” Berg said. Now the Los Angeles Unified School District wants to take it all away for Valley Region Elementary School No. 13. It’s turning out to be unlucky for Berg and other businesspeople and property owners in the neighborhood. The district plans to displace six buildings in the 14600 block of Lanark Street, one building in the 14600 block of Titus Street, and nine single-family homes along Cedros Avenue. More than that, the displacement further erodes an already shrinking supply of industrial-zoned land in the San Fernando Valley. Berg made the improvements to the 7,000-square-foot building facing Lanark Street. The owner of a print cartridge recycling company rents the rear 6,000-square-foot building. As a franchise, Berg is limited by geography where he can relocate. He is not interested in renting again but is uncertain of what is available to purchase and if he can afford it. Berg spent two years looking before finding the Lanark location. “To find a duplicate opportunity like that is going to be hard,” said Ron Feder, of Lee & Associates, a realty firm working with Berg. Elementary School No. 13 is among the 132 schools proposed by the district in a multi-year plan to have children stay in their neighborhoods rather than being bused elsewhere. Seventy-one schools have already been built, with 60 out of 65 additions completed. The new elementary school will relieve over-crowding at six other elementary schools and one primary center, district officials said. It would be situated on the same street as Panorama High School, which opened in 2006 to take students from three other Valley high schools. The 5.46-acre Lanark-Cedros site was one of two considered by the district. Community meetings took place in February to get input and ideas and the site was announced on March 4. The school board gave its approval three weeks later. Being bounded by streets on three sides gives greater flexibility to placing driveways and service entrances to the sites, said Al Grazioli, the district’s regional development manager for the Valley. In addition, the school will act as a buffer between residents and what remains of the industrial uses on Lanark, Grazioli said. The alternative site at the corner of Titus and Van Nuys Boulevard, where the unoccupied Panorama Tower stands, was not a viable option because it had fewer driveway entrances and would have children walking along a heavily-used street, Grazioli said. Chuck Carmichael won’t disagree with the advantage of keeping school children off Van Nuys Boulevard. For 17 years, Carmichael has been the leasing broker for a U-shaped multi-tenant industrial building at 14666 Titus Street occupying the future school site. The disadvantage to the chosen site, Carmichael told the school district, is that since the mid-1980s there have been few small, multi-tenant buildings, or incubators, built in the city. “They have 30 different businesses scrambling to find space so I can guarantee you they are moving out of the area; to Pacoima, San Fernando, or Santa Clarita,” said Carmichael, a senior vice president in the Encino office of NAI Capital. Nearly a quarter of the tenants may go out of business, Carmichael added. One tenant, H & H; Machining, already moved from Panorama City to Valencia rather than wait for the school district to give notice to vacate the building. The move cost about $50,000, Carmichael said. The district will pay fair market value for the buildings and help with relocation expenses. The next step for Nick Pepe, who restores classic Thunderbird automobiles in the back building at 14649 Lanark Street, remains up in the air. He could buy commercial property in the Valley or perhaps move out of state. What bothers him more than moving is the time he expects to be out of business because the school district won’t compensate for the loss of income, Pepe said. “This was all kind of new to us; this whole thing with them buying and us having to leave,” Pepe said. “We are weighing options.” (Business owners who believe they lost “goodwill” due to relocating can file claims with the school district that are considered on a case by case basis, Grazioli said.) For Berg, who has owned a franchise of Minuteman Printing since 1990, the main concern is whether the district offers to pay what he believes his improved building is worth. He bought the building with his printing business at $1.20 per square foot. The improvements bring it to $1.35 per square foot, Berg said. “I don’t see how we can possibly get back what we put into it from what they are saying,” Berg said.

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