With its Howard Hughes Center pulling in tenants at strong Westside rents, Arden Realty Inc. is picking up the pace of new construction to meet the demand.
And while builders pick up the pace, directors are probably dancing around the boardroom.
The real estate investment trust's Howard Hughes Center, its first major foray into new development, has been on a roll since signing a deal last year for a 160,000-square-foot, build-to-suit for Univision Television Group.
Pre-leasing rates in the newest building at 6080 Center Drive are going for an average $3.40 per square foot per month. The 12-story building is 80 percent pre-leased and set to open in the spring, according to Arden.
Leasing has been so strong that Arden decided to break ground this month on a 286,000-square-foot building at 6100 Center Drive, nearly 18 months ahead of a timeline put in place two years ago. It also plans to break ground next month on a 160,000-square-foot spec building at 6040 Center Drive.
Company officials say leasing momentum is strong and note that J.H. Snyder Co.'s 250,000-square-foot retail component of the project is set to open early next year. Most tenants are of the Old Economy variety and were attracted by the project's proximity to housing in the South Bay.
Strong leasing activity has also pushed up rents at the older 6701 Center Drive West (the Blue Shield building), where new leases are being signed at $3 a square foot, per month up from $2 three years ago.
"We have made Howard Hughes Center part of the lower Westside," said Robert Peddicord, Arden's senior vice president of leasing.
Indeed, a number of tenants are headed to the project from the Westside. Cooking.com signed up for 25,000 square feet and is moving from Santa Monica Business Park, while Benefit Planning Inc. is moving from Marina Towers on Admiralty Way into a 14,000-square-foot space.
In addition, law firm Haight, Brown & Bonesteel LLP will move from its 85,000-square-foot space at Water Garden I in Santa Monica into 61,000 square feet in a 10-year deal valued at about $25 million.
The fully leased 6060 Center Drive building's tenants include intellectual property law firm Fulwider, Patton, Lee & Utecht LLC, a former tenant at Westwood's Center West at 10877 Wilshire Blvd., and iXL, an Internet services company out of Westwood.
In fact, the office market has been so tight on the Westside that Turner Broadcasting Systems' planned move next August from 1888 Century Park East into Water Garden I in Santa Monica comes after brokers negotiated a complex deal to get law firm Haight Brown out of its lease to make room for TBS.
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