Glendale, the longtime Tri-Cities laggard, has suddenly become the most sought-after destination in the submarket.

Professional service firms from Pasadena and entertainment companies from Burbank are taking advantage of rents that are cheaper than their own cities. Glendale tenants also have increased their footprints to take advantage of the rents.

Average lease rates in Glendale remained steady at $2.58 a square foot during the quarter, while Pasadena’s rose one penny to $2.63 a square foot. Rents in Burbank fell eight cents, but still remained the Tri-Cities’ highest at $3.32, according to Jones Lang LaSalle Inc.

The result? Glendale absorbed 53,000 square feet of space – far more than its neighbors – dropping the city’s vacancy rate a full point to 26.2 percent. That, in turn, drove down the Tri-Cities overall vacancy rate a half-point to 23.2 percent,

The relocation of law firm Christie Parker & Hale was indicative of the trend. Bill Boyd, senior managing director at Charles Dunn Co., said the firm, which specializes in patent law, had comfortable offices in Pasadena but decided to move to 42,000 square feet in Glendale.

“It’s a dramatic development when a longtime Pasadena law firm sends the message that cost of occupancy is so important,” Boyd said. “Pasadena has amenities and history, but tenants are proving that price trumps those factors.”

Walt Disney Co., which is headquartered in Burbank, also turned to Glendale when it leased space on Brand Boulevard for its theme park division. Two other major companies in Pasadena are scouting for space in Glendale, said Boyd, who expects the migration to continue for some time.

Shaun Stiles, executive vice president at Jones Lang LaSalle, said the market also benefited local tenants staying put and taking more space. State Farm Insurance moved from smaller offices in Glendale to 25,000 square feet at 500 N. Brand Blvd.

Stiles has noticed that tenants also want longer-term leases – 48 to 60 months – in contrast to the 12-month deals that were standard for the last few years. He takes it as a sign that local tenants believe rents are at their low point.

“We’ve bottomed out from a rent standpoint,” Stiles said. “Rents won’t increase anytime soon, but you’ll see them increase within the next year.”

MAIN EVENTS

• Law firm Christie Parker & Hale leased 42,000 square feet at 655 N. Central Ave. in Glendale. The company moved from a five-story building in Pasadena. Financial details of the 15-year lease were not disclosed, but it’s believed the firm signed for lower rates. The new offices also will be more efficient on two stories with updated technology and amenities.
• Walt Disney Co. leased 32,818 square feet at 700 N. Brand Blvd. in Glendale. The 15-month deal was for $2.50 a square foot. Employees from the theme park division will occupy the space while they design the Shanghai Disney Resort.
• Eleven 23 Marketing, an online and print design studio, leased a three-story building at 209 N. Brand Ave. in Glendale. The five-year deal was for about $1.83 a square foot at the 18,300-square-foot building. The company moved from smaller offices within the city on Flower St.
• State Farm Insurance leased 25,000 square feet at 500 N. Brand Blvd. in Glendale. The three-year lease had a rate of $2.65 a square foot.
• The Glendale Chamber of Commerce sold its headquarters at 200 S. Louise St. for $1.7 million. The one-story building has five offices on 12,000 square feet.
• DC Comics, a division of Warner Bros. Entertainment, took 35,700 square feet of space in the Pointe, a new office building at 2900 W. Alameda Ave. in Burbank’s Media District. The lease rate was $3.65 a square foot.