By JOAN OSTERWALDER
It was another strong quarter in Ventura County, where office vacancies fell and new industrial facilities came on line.
Countywide, industrial vacancies rose to 8.3 percent in the fourth quarter from 8.0 percent in the third, according to CB Richard Ellis, though brokers attributed the increase to several new industrial properties being recently completed and more on the way.
Fred Ferro, vice president with Capital Commercial Real Estate in Oxnard, said in Oxnard alone there is more than 600,000 square feet of industrial space under construction. "Vacancy rates will rise temporarily due to new construction and maybe hit the 9 percent range by mid-year," he predicted.
Major developments that came on line during the quarter included a 181,000-square-foot build-to-suit for Medical Analysis Systems Inc. in Camarillo.
Most of the other new properties are considerably smaller. Industrial users are mainly seeking small buildings between 10,000 and 50,000 square feet. A host of such properties are being built on a speculative basis in Oxnard's Pacific Commerce Center.
"It's got the cheapest lease rates and land prices," Ferro said.
On the industrial front, Technicolor leased 93,000 square feet in Camarillo and Klingspor Abrasives Inc., a maker of sandpaper, leased 40,000 square feet in Oxnard.
Bob Kahn, vice president with CB Richard Ellis, said the biggest industrial deals in the Moorpark-Simi Valley area were a 110,933-square-foot sublease taken by Countrywide Home Loans and a 76,069-square-foot sublease taken by Auriga, an entertainment company.
The average industrial lease rate rose by 22.8 percent in 1998 over the previous year, Kahn said. "Of the buildings leased in the fourth quarter, half are new," he added.
Ventura County's office market was also strong, with a vacancy rate falling to 10.0 percent from 11.5 percent in the third quarter. Considering that in the fourth quarter of 1997 the office rate stood at 16.5 percent, the latest drop was just the continuation of a remarkably strong year.
"It dropped pretty dramatically from one year to the next," said Michael Slater, senior vice president with CB Richard Ellis. He said about 70 percent of the reduction in vacancy rates can be attributed to Ventura County-based companies that are expanding, rather than new companies moving into the area.
William Kiefer, managing partner at Capital Commercial Real Estate in Oxnard, said the lower vacancy rates can be attributed to a lack of significant construction over the past 10 years, and to an improved economy.
Among the major leases during the fourth quarter was a deal signed by RealSelect Inc. to lease 34,000 square feet on the first two floors of the Lincoln Oaks Corporate Center in Thousand Oaks.
"Along the 101 Corridor in the east and west county, the better office space is being leased up very quickly," said Steve Fedde, vice president with Sares Regis Group. "Office developers are requiring pre-leasing before they build. The absorption has been slow over the years, but it's starting to pick up It will make sense to build smaller spec office buildings."
Major sales in Oxnard included the 140,000-square-foot Spectrum at Fares Business Park that Sares Regis Group sold to Arden Realty for $17 million, and the 500,000-square-foot McInnes Ranch sold by Sares Regis Group to the RREEF Funds, an institutional investor, for $21 million.
The local retail market also is doing well, especially in the high-end sector, according to Linda Hagelis, vice president with Capital Commercial Real Estate.
"It's increasing rental rates," she said. "Along the Oxnard retail freeway corridor we've had some vacancy for some time, and now we have 100 percent occupancy. Now we're going to have a waiting list."
? Arden Realty bought the 140,000-square-foot Spectrum at Fares Business Park in Oxnard from Sares Regis Group for $17 million.
? The RREEF Funds bought the 500,000-square-foot McInnes Ranch from Sares Regis Group $21 million.
? A 181,000-square-foot build-to-suit for Medical Analysis Systems Inc. was completed in Camarillo.
? Technicolor leased 93,000 square feet in Camarillo
? Countrywide Home Loans took a 110,933-square-foot sublease in the Simi Valley area.
? RealSelect Inc. leased 34,000 square feet on the first two floors of the Lincoln Oaks Corporate Center in Thousand Oaks.
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