El Segundo-based Mattel Inc. has continued its real estate deal spree, this time signing a lease for 60,000 square feet at 831 S. Douglas St. in El Segundo.

The property is part of El Segundo-based Continental Development Corp.’s Continental Park campus.

“We are delighted to welcome Mattel back to our Continental Park,” Bob Tarnofsky, an executive vice president at Continental Development, said, adding that Mattel was a tenant roughly four decades ago.

The building will become home to the toymaker’s studio operations. It is moving from its current studio operation space by 2025, but its headquarters are not moving.

“We have been increasing our content production, driving a need for greater studio and creative space,” David Traughber, Mattel’s senior vice president of Commercial Finance, wrote in an email.

Earlier this year Mattel purchased a creative office campus next to its headquarters for $59.2 million known as Grand + Nash at 2160 E. Grand Ave. That property will be used as a design center.

Traughber said the company leases in some situations and buys in other based on its “strategic goals and specific operational needs.”

“This lease is part of our push to modernize our real estate by replacing long-term prior spaces with new ones that better fit our design capabilities, entertainment needs and other growth for years to come. Along with Grand + Nash, this space supports Mattel’s growth, giving us the room to expand our creative and studio operations to develop more content and IP,” Traughber wrote.

Mattel has had a busy few years, notably being the IP owner behind the hit film “Barbie,” starring Margot Robbie and Ryan Gosling. It is working on other films based on Mattel IP, including a Hot Wheels movie to be produced by J.J. Abrams, a Masters of the Universe film and a Monsters High film.

Mattel’s stock price has grown significantly over the past five years, jumping nearly 83% in the time period to $18.57 a share as of Oct. 24. That’s still below the more than $26 a share pricing seen briefly in May 2022.

El Segundo market

The El Segundo market has fared better than some other office markets in the county. The area, long known for being home to many companies in the aerospace industry, is welcoming other tenants to the area as well.

“The metamorphosis we’ve seen relates to all the economic engines that are now in the El Segundo area and the transformation away from what used to be exclusively aerospace and defense,” Tarnofsky said.

“We now see in addition to aerospace and defense legacy firms…we now see media, tech and entertainment firms regularly making the decision to call El Segundo their home. With the unfortunate flight out of downtown Los Angeles…the submarkets of El Segundo and of Century City have been the beneficiaries,” he added.

Indeed, the building Mattel leased was once home to a company doing work with the Apollo program before becoming office space for a magazine publisher.

“To attract the appropriate employee base to be able to create cutting-age digital content we had to transform the aesthetic of the building from a tired R&D building to a creative asset,” Tarnofsky said of the building’s recent transformation.

“One of the large movements we made with respect to the building was to add the gateway arch and the outdoor recreational space that spans the entire length of Douglas Street,” he added. “We really transformed the whole look of the asset.”

Nathan Piehl, a broker at Cushman & Wakefield who along with Brett Racanelli and Michael Condon represented Mattel in the transaction, added that he was seeing a greater push to quality assets and employers like Mattel “moving to the best assets on the market that have great amenities.”

He added that the Rosencrans Corridor was “probably the best ammenitized part of the South Bay” which was a reason it is seeing interest now.

Tarnofsky added that the area is also home to a lot of retail and desirable residential areas. He said he is also seeing more international toy companies come to the area to be closer to Mattel’s offices.

Looking forward, he said he also expects to see more multifamily projects in the area with some legacy office assets converted.

Tarnofsky said the area was also very “business friendly” which was attracting companies to the area.

“The El Segundo market is going to continue to be one of the core markets of the South Bay,” Piehl added.