Don’t expect last week’s destruction of New York’s World Trade Center to undercut the high-rise real estate market.
“I just don’t think it’s a relevant measure,” said developer Rob Maguire, who with former partner Jim Thomas developed some of the most prominent high-rise office buildings in downtown Los Angeles, including the city’s tallest, the 73-story Library Tower. “What terrorists are looking for are targets of opportunity, and those change and there certainly is no pattern.”
That was the consensus among commercial real estate officials in the wake of the terrorist assaults on the World Trade Center and Pentagon.
“If people are interested in being in a Century City-type location and all the things that represents, they pretty much have to be in a high-rise,” said Hunt Barnett, senior managing director at Insignia/ESG Inc.
Companies will not be relocating to get away from perceived terrorist magnets. “That event was more political than architectural,” said Marty Borko, vice president at Santa Monica architects Gensler.
Similarly, the decision to stay in high-rise offices can be more logistical than architectural.
“If your office is in downtown Los Angeles, Westside or Pasadena, you’re going to have to leave those locations to build a campus environment,” said Gary Weiss, managing director at Credit Suisse First Boston Realty in Century City.
If corporate real estate officials will not be making long-term lease decisions based on their emotional reactions to the terrorist attack, many folks are acting out of fear in the short run.
Barnett’s Century City office is in the twin towers of Century City Plaza, which were designed by the same architect who drew the World Trade Center. Coincidence or not, Barnett said some business dates were staying away last week.
“I’ve had people say they don’t want to come to meetings here,” Barnett said.
Such behavior is inexplicable to Maguire.
“If there’s a fear it’s people are afraid of irrational acts,” Maguire said. “I’m more uncomfortable riding in airplanes than walking in buildings.”
Even as he negotiates to unload his entire Los Angeles portfolio of high-rises in favor of developing campus style low-rises at Playa Vista, Maguire stands by the skyscraper.
“I think that what happened was so unthinkable,” Maguire said. “That kind of irrational, unfocused act is not relevant to the issue of whether a high-rise is a good office space.”
Westwood Village Still Rolling
Westwood continues to surge with commercial real estate activity, this time a building sale that likely will lead to a new eatery for the village that’s quickly becoming trendy.
A partnership of Century City retail and restaurant leasing company Blatteis & Schnur and developer E.M. Caplow & Associates of Beverly Hills has bought the former Hamburger Hamlet building next to the Mann Bruin Theatre on Weyburn Avenue. The sale, by owner Madison Marquette Retail Services, closed Aug. 31, according to Dan Blatteis. Blatteis refused to release the sale price, but said he paid market rate for the building.
The property features 12,000 square feet distributed evenly among three levels. A below-grade level is usable space, Blatteis said, and could be used for office space, for storage or as a prep kitchen if the ultimate tenant is a restaurant.
“Our plan is to fully renovate the building and lease it up quickly to a tenant who is a big positive for Westwood Village,” Blatteis said. Although no lease has been signed, Blatteis said a single tenant would be ideal. He said he is working with a couple of tenants and should have someone in the building by the end of the year.
Joel Mayer, senior vice president for Madison Marquette, said Blatteis & Schnur’s offer for the building was unsolicited. While Madison Marquette had owned the property for “a couple of years” it never was successful in finding a tenant, Mayer said.
“We had been trying to lease it and had several strong interested parties,” Mayer said. “This is something that made more sense.”
Blatteis & Schnur already own the Westside Center in Westwood, a strip mall across Pico Boulevard from the Nordstrom at Westside Pavilion.
Carson Office Sale
TA Associates Realty, a Boston pension fund advisor, bought One Civic Plaza in Carson from FTB Civic LLC of West Los Angeles for $14 million. Kevin Shannon, a senior vice president with Grubb & Ellis Co. represented both sides in the transaction.
Shannon said the six-story, 127,610-square-foot office building is part of Carson’s master-planned project that includes the 225-room Hilton Carson Civic Plaza, Carson Community Center and City Hall. Major tenants in the building, which Shannon said is 98 percent leased, include Lucent Technologies, Merchants Bank of California and the Private Industry Council.
Busy Brokering Building Sales
Marcus & Millichap Real Estate Investment Brokerage Co. reported involvement in a load of recent building sales. Northridge Medical Associates sold Northridge Medical Building to Lawrence Realty Group for $2.85 million. Ron Harris of Marcus & Millichap represented both sides in the transaction. The 34,656-square-foot-building is at 18250 Roscoe Blvd. in Northridge
SRE Real Estate Fund sold a 161-unit apartment building at 15425 Sherman Way in Van Nuys to F.F. Realty LLC for $10.3 million. Harris and Greg Harris of Marcus & Millichap represented both sides
Sandra Burle and Doris Isserman sold a 15,332-square-foot mixed-use building at 10251-65 Santa Monica Blvd. in Century City to Richlor Financial for $3.8 million. Ron Harris represented the seller. Chris Rogers of Marcus & Millichap represented the buyer
Glenwood Equities Management sold the 39,000-square-foot Iowa Courthouse Building at 18411 Crenshaw Blvd. in Torrance to Lam, Robinson & Co. for $2.6 million. Ken Hitchcock and Matt Sullivan of Marcus & Millichap represented the seller. Michael Harry of Insignia/ESG Inc. represented the buyer.
Staff reporter Christopher Keough can be reached at (323) 549-5225 ext. 235 or by e-mail at [email protected].
