For a small city, El Segundo is home to an impressive roster of big businesses. Aside from Chevron Corp.’s operation and all the major aerospace and defense companies that populate its roughly 2.5-square-mile business district, the city is host to headquarters offices for such public companies as Mattel Inc., DirecTV and Big 5 Sporting Goods.
While it’s a feather in your cap to house big corporate headquarters, an office market full of big users can be risky. As the city found when the aerospace industry pulled up stakes a generation ago, a big downsizing or relocation can leave gaping holes that drag occupancy rates and rents down.
That’s one reason El Segundo has turned its attention to luring smaller, more diverse businesses. Last month, it even launched a marketing campaign – One Hundred at One Hundred – in an effort to bring 100 new businesses to the city by its centennial in 2017.
Many of those businesses will be directed to an area known as Smoky Hollow. A light industrial area, Smoky Hollow is bordered by the Chevron oil refinery to the south, the city’s historic downtown core to the west, residential to the north and the Sepulveda Boulevard stretch of the Pacific Coast Highway to the east.
The area, once home to businesses catering to the refinery and aerospace industries, has in recent years seen an increasing number of creative entrepreneurial companies take root. Now, alongside auto body shops and manufacturing businesses such as semiconductor company International Rectifier Corp., one can also find offices for media, advertising, technology and architecture firms.
Sensing further potential for economic and physical revitalization, city officials in 2011 commissioned the local chapter of the Urban Land Institute to study Smoky Hollow. In its report, the ULI concluded that the area, with its narrow streets; small lot lines; and eclectic mix of low-rise, midcentury office buildings, held “great potential to become the L.A. region’s next successful incubator zone for technology and creative firms.”
But the area faces challenges to thriving as such a place. Many of the things that make Smoky Hollow an appealing place for media, technology and other creative businesses also double as barriers to its occupancy. For all their architectural charm, the buildings there are small and close together. They are also outdated and lack sufficient parking, and the narrow streets bring no relief.
Marty Borko, a principal at downtown L.A. design firm Gensler who participated in the ULI panel, said the report urged the city to seriously rethink its specific plan for the area, which was drafted decades before the area began to morph from a manufacturing district to one with more creative uses. Specifically, the report urged the city to consider solutions to developing on small lots and making accommodations for appropriate parking.
“El Segundo has an old, dated specific plan on the books right now, and it probably wasn’t the best tool to work with to stimulate reuse and investment in the area,” he said.
On that advice, the city last week tapped MIG, a city planning and design firm based in Berkeley, to develop a new overlay zoning plan specific to Smoky Hollow.
“MIG was selected based on their experience and their overall approach,” said Greg Carpenter, El Segundo’s city manager, of the competitive process. “The project kicked off (last) week and will take approximately 14 to 15 months to conduct background studies, community outreach, plan development, and then check back in with the stakeholders and finally go through the approval process.”
Once complete, the revised specific plan is expected to guide developers on how best to build out Smoky Hollow as well as facilitate multiple uses for the area. So far, redevelopment in the area has mostly been spearheaded by small, entrepreneurial companies willing to buy and renovate their own properties.
Drew Boyles, for example, chairman of the El Segundo Economic Development Advisory Council and an entrepreneur, bought a building in Smoky Hollow about 18 months ago that used to be a surfboard manufacturing shop. He renovated it to use as headquarters for his three budding businesses.
Alex J. Rose, senior vice president of development for Continental Development Corp., said it’s only a matter of time until bigger developers get in on the action.
“It’s not only a place for owner-users and small developers,” he said. “We, along with Mar Ventures, have made offers on a number of properties there and continue to be on the lookout for these cool, Venice-style buildings.”
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