Havas Interactive has tentatively agreed to a major lease, worth an estimated $36 million, at the Howard Hughes Center in El Segundo, according to industry sources, which would go a long way towards calming jitters in the Westside real estate market.
The pending deal would involve Torrance-based Havas taking over the 100,000 square feet that until recently was occupied by IXL Inc., which is closing its Los Angeles office. Havas would also get IXL’s high-end furnishings in the deal, sources said.
Havas, which already occupies 75,000 square feet at Howard Hughes Center, is said to be looking to consolidate its corporate and software development operations there. Its development operations now are in separate buildings in Torrance and Glendale.
The lease for the IXL space had not been signed as of late last week, and David Toomey, senior vice president for CRESA Partners who represented Havas in its lease for its present space at the Hughes Center, declined to comment other than to confirm that the company has been looking for several months for space to bring operations together.
The initial 10-year, 75,000-square-foot deal was signed in late 2000 and was reportedly worth $30 million.
A source familiar with the pending deal said Havas’ lease of the former IXL space would be for 10 years and at about $3 per foot per month.
If the deal is consummated, it would be something of a coup for the Westside market.
“It wouldn’t change the fact that dot-coms and related industries are struggling out there,” Toomey said. “It doesn’t reverse the fact that IXL had to give back its space, but it certainly would be a glimmer of good news amongst a sea of bad news that has been announced over the last several months in the technology world in Los Angeles.”
IXL, an Atlanta-based Internet consulting firm, announced a major restructuring on Nov. 28 that included closing its Los Angeles office. The company pulled out of its space at the Hughes Center in the past few weeks after fulfilling only a few months of a 10-year lease.
After trying to sublease the space, IXL negotiated a $4 million buyout with Arden Realty Inc., owner of the building, according to sources. IXL left behind about $8 million in tenant improvements at the building.