Office, Industrial Vacancies Inch Upward, Relief Distant
Ventura County
By DEBORAH BELGUM
Staff Reporter
In Ventura County, both the office and industrial markets are in a holding pattern.
Office vacancies in the second quarter inched up to 13.7 percent from 13.5 percent in the first quarter and about even with fourth quarter 2001.
The industrial vacancy rate rose to 8.3 percent in the second quarter, compared with 7 percent for the January-March period and 8.1 percent for the like period a year ago.
Some brokers expect the industrial sector to come back in the next few quarters as the economy improves.
“We should start to see an uptick in the first quarter of 2003,” said Gerald Pelton, managing director of CB Richard Ellis in Ventura County. He explained that industrial space is always the first to revive after an downturn as manufacturing revs up and warehouse space becomes more in demand.
The office market, Pelton added, could take a good year before there is a turnaround. “It could be the middle part of next year, the end of 2003 or the beginning of 2004,” he said.
Second-quarter activity in the office market consisted mostly of companies relocating from big spaces to smaller ones as they downsized or moved from other areas such as the San Fernando Valley or Glendale looking for cheaper rents. “All the prominent deals were relocations,” Pelton noted.
Among the companies relocating their offices to Westlake Village were InfoPro Solutions, Troop Real Estate (from Thousand Oaks) and Farmers Insurance (from Glendale).
Those hunting for bigger and better digs include Mercury Insurance, which needs 20,000 to 30,000 square feet, and Kaiser Permanente, which is looking to expand to a 50,000-square-foot space.
As in L.A. County, most of the quarter’s activity was in the sale of office buildings. With interest rates at all-time record lows, it is often preferable for companies to buy a building, lock in low interest rates and take control.
“The investment arena is very strong for the owner/user who wants to buy a building to occupy,” said Bill Kiefer, executive vice president for Ventura County at NAI Capital Commercial. “We have a classic market with little inventory for sale and plenty of demand.”
Smaller buildings popular
Right now, small is beautiful in the investment arena. “The thing that is real popular in our area is to buy smaller buildings,” said Mike Slater, senior vice president at CB Richard Ellis in Ventura County.
But there are major deals in the offing as well. Countrywide Credit Industries Inc. is on a major expansion spree, buying up several office buildings.
The Calabasas-based mortgage company is in escrow to purchase the 160,000-square-foot Thousand Oaks Corporate Center, the one-time West Coast headquarters for Exxon Corp. The company is said to be paying about $29 million.
Countrywide also bought the former Litton facility in nearby Agoura Hills, which borders Ventura County, for more than $20 million.
On the industrial side, several companies looking to cut leasing costs are moving to Oxnard and Moorpark from southern Ventura County, where industrial space is being used by research and development companies. Oxnard’s vacancy rate fell to 5.3 percent in the second quarter from 6.9 percent for the like period a year ago.
One of those making the move is Astro Cosmo Metallurgical, which signed a 10-year lease to occupy a 70,000-square-foot industrial space in Oxnard. The company is combining its facility in Ohio and Camarillo under one roof.
While Oxnard and Westlake Village are doing well, industrial space remains plentiful in Thousand Oaks where the vacancy rate hit 13.4 percent during the second quarter compared with 8.3 percent during the like period in 2001.
One of the industrial markets most affected by the economic downtown has been the city of Ventura. During the second quarter, industrial vacancies rose to 9.8 percent compared with 3.5 percent during the like period last year.
Ventura County
Major Events:
– Emmons Co. bought an 11,000-square-foot office building for $19.3 million at One Boardwalk in Thousand Oaks.
– Harrison, Eichenberg & Murphy bought an 8,800-square-foot building for $13 million at 155 Wilbur in Thousand Oaks.
– Technicolor signed a three-year lease for a 125,000-square-foot industrial building at 5217 Camino Ruiz in Camarillo.
– Astro Cosmo Metallurgical signed a 10-year lease to occupy a 70,000-square-foot industrial space in Oxnard.
– Yamagata Studio leased 27,000 square feet of industrial space at 1620 Emerson Ave. in Oxnard.
