It's taken longer than predicted, but the tide has finally turned in Glendale, where second quarter vacancies dropped more than a percentage point, to 13.4 percent. The 78,894 square feet of space taken off the market accounted for the Tri-Cities' only positive net absorption, according to Grubb & Ellis Co.

Of course, compared to Pasadena, where average asking rents spiked 26 cents to $3.54 per foot, and Burbank, where Disney's crown jewel, 3800 W. Alameda Ave., sold for $160 million, Glendale's gains may sound modest. But experts say the surging market portends changes that will alter the Tri-Cities.

"Tenants from outside the market are finally moving into Glendale," said John Winnek, director, Cushman & Wakefield. ", Countrywide, Kaiser, and the GSA (Alcohol, Tobacco and Firearms) all came from Pasadena or downtown L.A. They see the same access to labor, housing, and product, with asking rates 33 percent less."

Highlights included California's State Compensation Insurance group renewing for more than 50,000 square feet at 500 N. Brand Blvd. and United Healthcare Services expanding and renewing for 11,222 square feet at 505 N. Brand Blvd. IHOP Corp, which occupies 40,000 square feet at 450 N. Brand Blvd., entered into early lease negotiations.

On the investor side, two trades still on the table Legacy Partners' purchase of 101 N. Brand Blvd. for a reported $148 million, and Camber Real Estate's impending close at 225 W. Broadway for $33.5 million echoed buyer confidence given both sites are 40 percent vacant.

- ABC Cable Networks Group sold the 21-story Class A Disney Channel Building, 3800 W. Alameda Ave., Burbank, to Centurion Real Estate Partners for roughly $160 million or $390 per square foot. Walt Disney Co./ABC executed a leaseback arrangement for the majority of the space over seven and 10-year terms.

- Employers Compensation Insurance renewed for 50,373 square feet of space at 500 N. Brand Blvd. Terms from owner ING Clarion, which is making improvements to the lobby and common areas of Glendale's second largest high-rise, were in the $2.50 per foot range for 64 months.

- United Healthcare Services renewed and expanded at 505 N. Brand Blvd. in Glendale. Total consideration from owner Napi Glendale 1 LP (institutional money managers Prudential UK) was for $1.45 million, with 5,462 square feet directed toward renewal and 5,760 toward expansion.

- Nestl & #233; USA added more than 18,000 square feet of space to its corporate headquarters at 800 N. Brand Blvd. The 96-month term from Wells Real Estate Investment Trust was in the $2.70 per foot range, and accounted for space the chocolate giant had "dropped back" in December as part of its larger renewal deal.

- New York Life Insurance Co. vacated roughly 12,000 square feet in Blackstone/EOP's Pasadena Towers 1, 800 E. Colorado Blvd. where rents have climbed to more than $4.50 per foot, and moved to 301 N. Lake Ave. The relocation fetched an effective rental rate of $3.10 per foot. The building's owner, Operating Engineers, signed the insurance firm up for seven years and 14,000 square feet.

Office Market at a Glance

Inventory: 18.6 million square feet
Under Construction: 0
Class A Asking Rents: $3.07

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