Major events in individual commercial and industrial real estate markets across the area in the fourth quarter.
The good news for those looking to rent Hollywood offices? You can get a pretty nice deal these days. The bad news? A lot of the good stuff is taken.
For the second quarter in a row, vacancies in the Hollywood-West Hollywood office market fell slightly, to 14 percent, according to Grubb & Ellis Co., but it was amid a glut of undesirable space.
“The majority of what makes up the vacancy rate is old, dated Class C product that most tenants don’t want,” said John Tronson, principal, Ramsey Shilling. “Unless it’s really, really cheap, it just doesn’t move.”
Class A and B space, however, is leasing consistently, albeit at 20 percent and 30 percent off boom time rates.
“People have realized it’s not going to be the next Great Depression and they’re getting back to doing business,” he said.
The Class A asking rent fell three cents to $3.64 per square foot, while Class B rent saw a six-cent decrease to $3.40. Overall, tenants sopped up more space than was vacated, landing net absorption in positive territory.
Meanwhile in West Hollywood, tenants were salivating over being able to enter the market at a desirable rate. “People just want to be in that area. They expect a discount, of course, from 2007. But it’s really special in terms of what kind of attention it gets,” said Jay Martinez, principal, Lee & Associates.
He pointed to a building at 359-373 N. Robertson Blvd. acquired by a carpet retailer for $6.2 million last quarter. The building had originally gone on the market with an $8 million price tag and received 23 offers.
Office Market At a Glance
Inventory: 4 million square feet
Under Construction: 400,000 square feet
Clas A Asking Rent: $3.64
- Joey Bishop Productions Inc. sold a 6,876-square-foot retail building on a two-parcel lot at 359-373 N. Robertson Blvd. in West Hollywood for $6.2 million as part of the late entertainer’s estate sale. Bishop died in October 2007. Buyer Sakhi Properties LLC will use the building for its retail carpet
business, Amadi Carpets.
JC Chen signed a five-year lease for 14,451 square feet of office and industrial space at 945 N. Highland Ave. with landlord Snyder Family Trust in a deal worth $1.09 million.
CFRI-NCA Hollywood Ventures LLC leased out 10,837 square feet of office space for five years at 1622 N. Highland Ave. to Campus Hollywood, which owns several art and music schools. The deal is worth an
estimated $1.26 million.
MTI Films LLC signed a five-year lease for 5,400 square feet of office space at 1016 Sycamore Ave. for a total consideration of $550,000.
Playhouse Hollywood, an entertainment venue, took 4,000 square feet of office space at 6436 Hollywood Blvd. for five years for an estimated total consideration of $320,000. Life Management Property LLC is the landlord.
Construction continued last quarter on the Red Building, the final phase of West Hollywood’s Pacific Design Center. When completed, the Red Building will include 400,000 square feet of office, retail and showroom space split between two towers over seven stories of parking. The building is slated to open later this year.
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