SANTA CLARITA: Advanced Bionics Deal Provides Shot in Arm

David Geffner
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For the past year, Valencia’s commercial market has been on a roller-coaster ride that would rival anything at nearby Magic Mountain.

Santa Clarita’s rate saw a near-5 percentage point drop to 20.4 percent, and strong positive absorption – thanks to one deal: Advanced Bionics exited its Rye Canyon digs and leased up all five stories of the 144,000-square-foot Summit Oaks at 28515 Westinghouse Place.

The firm, owned by Alfred Mann, began partial occupancy in October and will complete the transition next year. However, it’s unlikely the move will set a trend.

“One tenant trading space can skew the vacancy rate, but it does nothing to negate the market’s trend,” noted Jim Lindvall, managing director, Jones Lang La Salle. “Deals aren’t getting done due to a lack of demand.”

Certainly the housing crash and recession has put an end to Santa Clarita’s decade-old spec boom. In fact, the remaining 199,000 square feet in the pipeline, as reported by Grubb & Ellis Co., comes from one project: LNR Entrada Gateway Center, at Magic Mountain Parkway and the Old Road.

Sources said of the two four-story, steel-frame buildings that will total 203,000 square feet, one should come on line by year’s end. But construction of a second building has halted until tenant demand increases.

Meanwhile, the valley’s economy got a shot in the arm when Santa Clarita’s largest landowner, LandSource Communities Development LLC, emerged from Chapter 11 reorganization as Newhall Land Development LLC.

Office Market At a Glance

Inventory: 2.66 million square feet

Under Construction: 199,000 square feet

Class A Asking Rents: $2.61

MAIN EVENTS

  • Medical device maker Advanced Bionics moved into a 60,000-square-foott portion of Summit Oaks at 28515 Westinghouse Place in Valencia, with plans to occupy the remaining 84,000 square feet in summer 2010. A joint venture of Parker Properties and RREEF Alternative Investments, Summit Oaks had been sitting vacant since it came on line in mid-2008 but is now 100 percent leased.

  • Santa Clarita’s largest landowner, LandSource Communities Development LLC, emerged from Chapter 11 reorganization as Newhall Land Development LLC, with more than $90 million in cash and zero debt. The new entity, which will move forward with the planned Newhall Ranch residential development, will be managed by Emile Haddad, the former chief investment officer of Miami-based home builder Lennar Corp. Haddad is now chief executive of Five Point Communities Management Inc., a newly formed management company jointly owned by Haddad and Lennar.

  • Ronan Engineering leased up 28209 Avenue Stanford in Valencia. The 59,600-square-foot industrial site included 17,770 square feet of office space and had been on the market for 21 months. Terms from local owners Earl and Dorothy Cole were undisclosed, but the deal included three months of free rent.

  • Vista Controls Inc., a manufacturer of programmable logic controllers and safety control devices, renewed its lease for 51,061 square feet at 28965 Avenue Penn in Valencia. Terms were undisclosed. Owner is Irvine-based LBA Reality, which purchased the industrial parcel in 2007 for $6.9 million.

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