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Friday, Feb 23, 2024

SPECIAL REPORT: Antelope Valley Tenants Face Scarce Inventory

The industrial vacancy rate in the Antelope Valley decreased during the fourth quarter of 2015, a sign that the available inventory continues to shrink in the face of no new construction. A single-story, 101,265-square-foot office building at 176 Holston Drive in the Lancaster Business Park sold in October for $3 million, or $29 a square foot. The buyer was Frank Visco, a developer who built the building in 2002, and the seller was L.A.’s Rising Realty Partners and New York’s Mount Kellett Capital Management. The space is available for lease at $10.80 a square foot. An Arco gas station and ampm convenience store at 2520 E. Avenue S in Palmdale sold in October for $5 million, or $1,525 a square foot. The buyer of the two buildings, which total 3,266 square feet, was oil giant Tesoro Corp. in San Antonio and the seller was Hagop Kofdarali of Corona. The property 1305 W. Rancho Vista Blvd. in the Antelope Valley Mall in Palmdale sold in October to Forest City Enterprises Inc. of Cleveland. The seller was Steven Ferreira of Miami. The 76,550-square-foot building was constructed in 1999 and is fully leased by retailer Forever 21 Inc. House of Kabob has signed a lease to take 1,600 square feet at the Palmdale Promenade at 422 W. Avenue P. The owner of the property is Cal World Palmdale. The lease rate was not disclosed. There were two new leases during the quarter at Plaza Del Centro, 525 E. Palmdale Blvd. in Palmdale. Fast Auto Loans took 3,200 square feet and Lucy’s Laundry took 3,330 square feet. The deal values were not disclosed. Office vacancies, however, remained about the same as they were in the third quarter, hovering just above 18 percent. Harvey Holloway, a broker with Coldwell Banker Commercial Valley Realty in Lancaster, said that industrial space has done better than office because of the lack of product. “We have more tenants than we have product,” he said. “That is bringing the rental increases and those increases support the higher sales prices.” The industrial vacancy rate in the quarter was at 1.9 percent, down significantly from the previous period’s 3.6 percent, according to data from Colliers International. The square-foot asking price increased to 52 cents, an increase of 6 cents quarter to quarter. Dennis Marciniak, a vice president in the Woodland Hills office of Daum Commercial Real Estate Services, said there had been a glut of distressed properties in the Antelope Valley that have all sold and been occupied, but developers are not ready yet to start building. “There needs to be confidence to do much in terms of building on spec,” Marciniak said. In the office market, the vacancy rate was 18.5 percent in the quarter, nearly the same as the previous period’s 18.6 percent, according to Colliers. That marks a slight uptick from 18.2 percent a year ago. The asking price remained nearly flat quarter to quarter at $1.66 a square foot. The most prominent sale during the quarter was the October acquisition of a former Bank of America call center in Lancaster for $3 million. Lancaster developer Frank Visco made the purchase from Rising Realty Partners of Los Angeles and Mount Kellett Capital Management in New York. In late October, Cleveland-based Forest City Enterprises Inc. purchased the land underneath a store at the Antelope Valley Mall for $7.8 million from Steven Ferreira of Miami. The 76,550-square-foot building, at 1305 W. Rancho Vista Blvd., was constructed in 1999 and is fully leased by women’s clothing retailer Forever 21 Inc. Forest City now owns all the property at the mall. – Mark R. Madler

Mark Madler
Mark Madler
Mark R. Madler covers aviation & aerospace, manufacturing, technology, automotive & transportation, media & entertainment and the Antelope Valley. He joined the company in February 2006. Madler previously worked as a reporter for the Burbank Leader. Before that, he was a reporter for the City News Bureau of Chicago and several daily newspapers in the suburban Chicago area. He has a bachelor’s of science degree in journalism from the University of Illinois, Urbana-Champaign.

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