Although by some accounts the volume of commercial development in Los Angeles County dropped more than 10 percent in 2000, you wouldn't get that sense by looking at the performance of the region's top real estate brokers, developers and investors.
For those collecting top honors in the Los Angeles Business Journal's annual real estate awards, posting numbers comparable to and in many cases better than recent years was par for the course.
The most active retail and office developers of 2000 did come in under the numbers of the previous year's winners, but the industrial market powered ahead. Trammell Crow Co. reported breaking ground on 2.5 million square feet of development in L.A. County last year, 800,000 square feet more than the company broke ground on locally the year before, when it also was the most active industrial developer.
Most of the numbers reported by this year's winners were up over 1999. There were big increases in commercial investments, with No. 1-ranked investment broker Kevin Shannon, senior vice president at Grubb & Ellis Co., reporting deals totaling $302.3 million. That's $166.5 million more than the 1999 winner. Shannon's business was bolstered by working on the divestiture of two $25 million portfolios for Comstock Crosser & Associates and Pacifica Capital Group.
Shannon and the other winners were honored with a cocktail reception and awards ceremony March 20 at the Peninsula Hotel in Beverly Hills.
Steve Marcussen of Cushman Realty Corp., who took the prize among office tenant brokers, said the awards are nice recognition of hard work and the event is a good networking opportunity.
"It was well-attended by a broad range of people who don't always (keep in) touch (with) each other," Marcussen said.Industrial giants
On the development front, Trammell's business last year was concentrated at three projects: Irwindale Business Center, Van Nuys Airport Industrial Center and the 10-building, 550,000-square-foot Heritage Springs Business Park in Santa Fe Springs.
Overton Moore Properties' 1.8 million-square-foot Port Los Angeles Distribution Center in San Pedro brought that company runner-up honors and Robertson Properties Group was third-busiest with its 550,000-square-foot Pacific Gateway Distribution Center in Pico Rivera.
Ben Bartolotto, research director at the Construction Industry Research Board in Burbank, said nonresidential development in Los Angeles County declined about 10 percent in 2000, from $3.68 billion in 1999 to $3.3 billion last year.
That downturn in activity was due entirely to the decrease in office construction industrial and retail construction activity were both up in 2000. Clifford Goldstein, a partner in J.H. Snyder Co., said the decrease in new office space built in 2000 is not a harbinger of a slowing trend.
"The market for building office buildings is not so linear a process that you can compare from year to year," he said, adding that much of the office product delivered in the late 1990s had been entitled ever since the real estate crash early in the decade.
In the brokerage community, CB Richard Ellis Inc. had a stellar year, with four representatives topping the six commercial brokerage categories.
There was significant leasing activity around Los Angeles in 2000, with a number of dot-com deals signed (before the bubble burst) and the dearth of affordable Westside space sending businesses south as far as Torrance and east to Pasadena and beyond.Top-producing brokers
Performance numbers were up across the board for the brokers. CB's Richard Rizika won the retail broker award with a reported $129.7 million in deals last year. Marcussen of Cushman Realty was the top producer among office tenant brokers, with a reported $285.3 million in transactions. Office landlord broker John Ayoob of CB was his field's top performer, with $452.8 million in leases.
Shannon, the No. 1 broker in commercial investments, said his volume of business was well beyond what he could have expected. He doesn't count on topping that performance this year.
"I'm anticipating a slower year," he said. "There's a lot of people trying to figure out how this thing's going to go."
While Shannon brokered the most commercial investment deals last year, New York-based Tishman Speyer Properties invested the most in local properties, even though its only L.A.-area purchase was MGM Plaza, which it bought for a reported $353 million.
Jim Brooks, Tishman Speyer's senior director for Southern California, said the deal was somewhat risky because anchor tenant MGM has decided to move out at the end of its lease in 2003.
"We understood that MGM was a wild card in the project, but we continue to believe that (MGM Plaza) will represent an opportunity for us," Brooks said.
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