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Faith in the Future of Office

An aging Warner Center building, vacant for more than a year, badly needs to reposition itself for the post-pandemic economy.Avi Lerner, owner of the Warner Landmark, and his investors have a plan to transform the building at 21555 Oxnard St. in Woodland Hills into a creative office site, with the possible addition of a neighboring hotel working synergistically with their structure.Lerner, who is often confused with the film producer of the same name, and company last month shared their vision with the Planning and Land Use Management Committee of the Woodland Hills Warner Center Neighborhood Council. Ownership has enlisted CallisonRTKL and landscape architecture firm Relm to lead the Warner Landmark redux.While Lerner has yet to submit plans to the Los Angeles City Planning Department, the vision he shared with the committee proposes an adaptive reuse of the office tower with amenities such as restaurants and retail. Parking would remain in an existing subterranean garage.Until two years ago, Lerner didn’t need to seek tenants to fill the 14-floor, 450,000-square-foot building. Since Lerner and his partners bought the building for $76.9 million, it was 100 percent leased by health insurer Anthem Blue Cross.

“We bought it 25 years ago,” Lerner told the Business Journal in an exclusive interview. “We had one tenant: Anthem. That lease expired at the end of last year and they elected to downsize and move across the street.”Since Anthem’s exit in late 2018, brokers at CBRE Group have worked to lease the building. CBRE Group Vice Chairman Jeff Pion and Executive Vice President Matthew Heyn originally planned a revamp contingent on an incoming tenant for mid-2020 but then the virus hit last March and stalled all efforts, Pion said.Lerner and his partners have taken advantage of pandemic year to get their proverbial ducks in a row so they could move forward on their long-gestating renovation plans.“Ownership restructured their debt on the property,” Pion said. “Now they intend to reposition the building to be the West Valley’s creative office offering.”Viral impactGiven the impact of COVID-19 across last year on the office sector, Pion said Lerner and company “wanted to hedge their bets” with residential or hotel usage being a back-up plan should the office market continue to dovetail.“In the middle of the pandemic, office buildings disappeared,” Lerner said. “We took a plan to turn it into an apartment building in case office buildings went bye-bye.”“Most of them have been more involved with office projects and not residential,” Pion added, regarding Lerner and his three primary partners. “Their primarily goal is to lease the building to fantastic tenants that want an office in Warner Center.”Also, the team proposed a 300-key hotel perched atop 17,000 square feet of supermarket space for Phase II of the project, as seen in a rendering. However, in separate conversations with the Business Journal, Lerner and Pion downplayed talk of the hotel component and debunked the residential rumors because office product remains ownership’s primary goal.“For all intents and purposes, the building will be brand new,” Pion said.Gazing at the rendering of the new Warner Landmark, Pion observed that the building “sits like a lighthouse in the heart of Warner Center.”The redevelopment will revamp the landscaping and “create a tremendous amount of exterior and plaza area,” Pion said. That will include reconfigured interior spaces modified as tenant improvements, updated air conditioning systems and new landscaping outdoors.Lerner foresees a restaurant or two on the ground floor, but it’s too early for specifics.“We’ve had inquiries from a virtual kitchen, stockbrokers, a gym – that was pre-pandemic,” he said.Within Warner Center, the building occupies a strategic block with 6.3 acres of land. It sits across the street from Unibail-Rodamco-Westfield’s Promenade mall, which the company is redeveloping with its $1.5 billion Promenade 2035 project. To the south, it’s across the street from Douglas Emmett’s Warner Center Towers office complex. And within walking distance are various restaurants and even a hotel.“It’s very unique that you get a building this central,” Pion said, “walking distance and across the street from the Westfield restaurants.”Lerner said that selling the building or the land it sits on, which is owned by a different entity, to Westfield was never in the cards.“They’ve got enough on their hands,” Lerner said. “It took them 10 years to get to where they are now with (Promenade 2035). We never entertained that idea seriously at all.”Pion said that the Warner Landmark is well positioned for a resurgent economy.“There’s a lot of office users coming back to work as early as this summer,” Pion said. “We have the largest block of contiguous space in the Valley.”

Michael Aushenker
Michael Aushenker
A graduate of Cornell University, Michael covers commercial real estate for the San Fernando Valley Business Journal. Prior to the Business Journal, Michael covered the community and entertainment beats as a staff writer for various newspapers, including the Jewish Journal of Greater Los Angeles, The Palisadian-Post, The Argonaut and Acorn Newspapers. He has also freelanced for the Santa Barbara Independent, VC Reporter, Malibu Times and Los Feliz Ledger.
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