Mark Kelley thought that continued expansion and health insurance for his 25-person staff would be the biggest challenges his San Dimas communications firm, Sigtronics, would face this year.

Deciding whether to buy the 4,000-square-foot office space in Baldy View Industrial Park or moving out wasn’t on the agenda. But it’s on top of it now.

Kelley found out in November that Baldy View had been sold to Costa Mesa-based investment firm Guthrie Asset Management. Guthrie then announced that its 13 units would be for up for sale once leases expired. Renewals would no longer be an option.

“Talk about taking the wind out of our sails,” said Kelley, whose company has manufactured high-end intercom systems used by aircraft and emergency vehicles for the past nine years at the site. “Most of us here leased because we chose to or had to. The original landlord didn’t even inform us the property was being sold so it came as a complete surprise to all of us.”

The office park houses a carpet-installation company, a tire and rim retailer, a direct mail company and a printing company among others. All 13 companies that inhabit the park are sole proprietorships and San Dimas City Manager Blaine Michaelis said there’s not a lot anyone can do.

“If the owner wants to sell it, it’s their choice,” he said. “We always keep the best interest of the community in mind, and now we have to do everything we can to ensure these companies stay where they are, or we’ll help them find similar office space here in the city. We’re doing everything we can.”

The city is reviewing the parking and utility requirements before the units can officially go on sale. Michaelis said the units will be sold for between $155 and $164 per square foot. That’s close to market value for the area, according to Chris Bonney of the real estate firm Lee & Associates. Bonney also mentioned that this was one of the first examples of an occupied office park changing hands and the tenants being asked to either buy or hit the road.

“We’re seeing a lot of projects similar to this, but on vacant or soon-to-be vacant buildings,” Bonney said. “This is one of the first on an occupied complex,” he added.

Guthrie did not return calls seeking comment for this article.

New space


San Dimas has nearly completed construction on Arrow Highway Corporate Center, a larger office park about two miles away from the Baldy Park with similar accommodations, which Kelley is looking at as a home for Sigtronics. However, the space will be more expensive, an additional $12 to $18 per square foot. Those figures don’t include the improvements, such as additional power requirements and other modifications, which many of the tenants will require for their operations.

Industrial spaces of less than 10,000 square feet are difficult to find in Southern California, and the sprawling industrial parks made for small companies such as Kelley’s have been rental property, historically. Now, however, investment companies are buying them up and flipping them into business condos, leaving the inhabitants with few options, said Vance Baugham of the San Gabriel Valley Economic Partnership.

“We need to preserve these types of parks and the lower rent rates they provided for small business,” he said. “The companies in them provide a wide array of jobs, from well-paying blue-collar manufacturing jobs to white collar engineering positions, and they add much needed tax revenue to the local economies. But it’s getting to where the companies these structures were made for can’t afford to stay in them, and that’s a huge problem.”

The community is feeling the economic sting, but the small business owners are left footing the bill.

“This move is nothing but an inconvenience for us,” Kelley said. “It going to cost us between $200,000 and $400,000 to move, out of pocket, not to mention the time that’s already been wasted and the energy spent looking for a new space that should’ve been spent researching new products and establishing relationships with customers. It’s an all-around bad situation and there’s nothing we can really do about it.”

Office park projects have been proposed or are in the works in La Verne, El Monte and Los Angeles.

It’s a trend that Los Angeles County Economic Development Corp.’s chief economist, Jack Kyser, calls a high-high, low-low economy. That means the county could eventually be largely made up of either low-level, low paying jobs or high-level, high-paying jobs with no room for the middle class.

“These industrial parks are crucial to keeping our economy running,” he said. “These parks mainly house the entrepreneurial companies that are service providers for surrounding communities and they’re being told to pay higher rates or go packing.”

He points to the industrial real estate market boom as the reason the small business leases are becoming an endangered species here.

“Developers would rather build condos or put them up for sale to make a quick profit,” Kyser said.