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South Bay Top Lease, Sale and Trends for Office

Top Lease Deals

1. Children’s Services leased the entire 60,804 sf Park Del Amo Building in the Central Torrance Market.

2. Imperial Bank expanded by 36,160 sf in the Imperial Bank/Airport Freeway in the LAX market.

3. Carlsberg Management leased 21,095 in the Telecredit Building in the LAX market.

Top Sale Deals

1. Candle Corporation purchased the former 335,059 sf Rockwell engineering building located at 201North Douglas Building in El Segundo for $30 million.

2. A group of investors led by Donald Lam purchased the 68,000 sf Albertoni Business Center for $4.8 million.

Trends

1. There is currently 452,000 sf under construction in the South Bay market. Construction is once again becoming prevalent in the South Bay cities. The 139,865 sf Kilroy Airport Center Building and the 50,000 sf Cerritos Towne Center are the first new office buildings to complete construction since 1992. The El Segundo/Manhattan Beach market, where all current construction is taking place has many developments in the works. For example, Raleigh Studios 60,000 sf Phase II is currently under construction, Continental Development is proposing a two building, 300,000 sf office park on the corner of Rosecrans and Douglas and the Grand Avenue Corporate project which broke ground last quarter. There are also several retail projects under construction in the area.

2. With the completion of Raleigh Studios Phase I in August of last year, which is 100 percent leased, and the anticipated completion of Phase II in July of this year, the entertainment industry seems to be moving south. The city of El Segundo, which welcomes the industry with open arms, has already had land zoned specifically for multi media use. This positive step by the city will create easier access and entitlement for the entertainment industry.

3. Upscale retail and trendy restaurants are being constructed throughout the South Bay. These types of amenities are very attractive to new tenants thinking of moving to the area. For example, in the Harbor Gateway area of the South Bay where amenities are minimal, these types of amenities were a long awaited attraction. Currently, Starbuck’s Coffee, Carl’s Jr., Subway and a large food court with many fast food types of restaurants are under construction at the Harbor Gateway Commerce Center. Area brokers feel these new amenities coupled with lower rental rates in the area will help renew current tenants and assist in the decision of new tenants looking in the area.

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