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The office and industrial markets in the Antelope Valley were a mixed bag in the fourth quarter. While data showed an increase in vacancy rates for both markets, brokers working in the Palmdale and Lancaster areas said leasing and sales activity was picking up. “We have noticed an uptick in the number of sales,” said Harvey Holloway, a broker with Coldwell Banker Commercial Valley Realty in Lancaster. One leading example: Coldwell Banker closed escrow on a 19,000-square-foot building at 1055 West Avenue L-12 in Lancaster bought by Incotec Corp., an aircraft-fastener coating company. Incotec moved its headquarters and some of its manufacturing to Lancaster from the Mojave Air & Space Port. Financial details were not disclosed. Elsewhere, DAUM Commercial Real Estate Services closed sales on three medical condos at the Venture Commerce Center in Palmdale and one industrial condo at the Lancaster Business Park. The firm hopes to soon close the sale of a 130,000-square-foot building in Palmdale formerly occupied by a contract manufacturer, said Dennis Marciniak, a vice president in the Woodland Hills office. “We have two potential buyers, but there is nothing completely solid on it,” he added. On the leasing side, office properties had a vacancy rate of 14.1 percent in the fourth quarter compared to 13.3 percent in the prior quarter. About 6,700 square feet went back on the market, according to data from Colliers International. Surprisingly, the average asking lease rate was $1.78 a square foot, an increase of 7 cents from the prior quarter. Marciniak said the increase is reflective of newer buildings being the only ones available. “The cheap stuff is gone or at much slower inventory and that pushes a higher price too,” he said. For industrial properties, the vacancy rate was 7 percent in the fourth quarter compared to 6.4 percent the prior quarter. About 29,400 square feet came back on the market. The average lease rate for industrial properties was 50 cents a square foot, an increase of 5 cents compared to the previous quarter. Meanwhile, the Antelope Valley retail market got a boost, though it won’t really take off until the local housing market takes off, said Vincent Roche, a senior director in the Bakersfield office of commercial real estate broker firm Cushman & Wakefield Inc. The most significant retail announcement during the quarter was that Dick’s Sporting Goods Inc. would be opening a store at the Antelope Valley Mall in the fall of 2014. The national chain will occupy the building that had once been a Gottschalks Inc. location. While the addition of Dick’s is good for the Antelope Valley market, in and of itself it won’t mean much to attract other national chains, “The concentration of retailers already there and the success they have is a compelling reason (for other retailers) to locate in that area,” Roche said. The broker is currently working with other undisclosed national chains who are going to open their first stores in the Antelope Valley. – Mark R. Madler – Main Events A 268,000-square-foot power center in Lancaster sold for $39 million in October. The Lancaster Commerce Center at 1020-1050 Commerce Center Drive was bought by Cadence Capital Investments LLC of Greenwood Village, Colo. from CenterSquare Investment Management of Plymouth Meeting, Pa. The center was about 80 percent leased at the time of sale and is anchored by a Ross Stores Inc. outlet. A freestanding Rite-Aid Corp. store in Palmdale sold for $6.2 million in October. The 17,246-square-foot property at 37950 47th St. East was purchased by K.I.F. LLC of Bakersfield from Halferty Development Co. of Pasadena. The drug store has about 15 years left on its lease. In November, Dick’s Sporting Goods Inc. announced plans to open a retail store in the Antelope Valley Mall in Palmdale. The Coraopolis, Pa. retailer is leasing the 95,000-square-foot space formerly occupied by mid-tier department store chain Gottschalks Inc. The space will be redeveloped and alterations will be made to the entrance. Forest City Enterprises Inc. of Cleveland owns the freestanding building. Broadstone Real Estate of Rochester, N.Y. bought three auto dealerships in Palmdale. The properties add up to more than 105,000 square feet and the sales totaled $11.5 million. All three dealerships were bought from Rally Auto Group of Palmdale. The dealerships acquired were the Hyundai of Palmdale, a Buick dealer and a Chevrolet dealer. A 24,000-square-foot industrial building in Lancaster sold in November for nearly $1.5 million. The 41781 12th St. West building was bought by Rami Darghalli Living Trust of Lancaster from MarNor Investments LLC. The property was built in 1987 and was fully leased at the time of sale. – Antelope Valley Office Market At a Glance Inventory: 881,900 square feet Under Construction: 0 Class A Asking Rents: $1.78

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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