By LISA STEEN PROCTOR
If all goes as planned, South Bay residents won’t have to drive far to catch a movie or buy a used car.
The area is getting its fair share of numerous mega-plex movie theater projects sprouting up around Los Angeles County. Meanwhile, proposals for sprawling used car lots are in the works at three South Bay locations.
During the first quarter of 1997, General Cinema Corp. began construction on a 16-screen theater at the Galleria at the South Bay. It is being built on top of the Torrance mall’s parking structure.
AMC Entertainment Inc. has also begun construction on a movie mega-plex with 20 to 22 screens in the Rolling Hills Shopping Center at the corner of Pacific Coast Highway and Crenshaw Boulevard.
These new theaters will be added to a string of mega-plexes already recently completed in the area, including a 16-screen complex by Pacific Theatres Corp. on Rosecrans Avenue in El Segundo.
Will all these big theater complexes one day saturate the market?
It’s too soon to tell, said Ted Dawson, vice president at CB Commercial Real Estate Group Inc. “The 16-plex Pacific in Continental Park seems to be doing very well,” he said. “(The other mega-plexes) will initially do well. In the long run, it will be harder to tell.”
Meanwhile, large-scale used car lots also are making inroads into the South Bay. Chains such as CarMax Inc. (a division of Richmond, Va.-based Circuit City Stores Inc.) and AutoNation (started by Blockbuster Video founder H. Wayne Huizenga) have been on the look-out for large parcels of land in L.A. County to set up lots that offer cars from different manufacturers without the usual haggling associated with car purchases.
They apparently found what they were looking for in the South Bay.
An AutoNation is being developed on the corner of Normandie Avenue and 190th Street at the South Bay Town Center in the Torrance Central submarket.
The chain has also committed to being a part of a Long Beach redevelopment project at the Long Beach Town Center, located at the San Gabriel River (605) Freeway and Carson Street. The project will involve more than 1 million square feet of retail space; retail anchors will be announced in the next 30 to 60 days, said Bill Bauman, vice president of the retail properties group at The Seeley Co. Construction on the project is slated to begin this summer, he said.
CarMax is “moving forward to take a site” in Carson at the Harbor (110) Freeway and Torrance Boulevard, said Bauman. The used car chain would occupy 26 acres at Carson Town Center.
Despite all this activity and interest, retail real estate has been slower to recover in the South Bay than it has in most other areas of L.A. County.
“We’re the last of the Mohicans,” said Lawson, referring to the lagging retail recovery. “Hopefully, rents will start to rise. They haven’t started yet, but they will go up slowly, very slowly.”
Meanwhile, office vacancy rates continued to drop and rental rates continued their upward trend in El Segundo, especially in the Rosecrans Corridor.
The vacancy rate dropped in the El Segundo/Manhattan Beach office submarket from 20.6 percent in the last quarter of 1996 to 18.2 percent in the first quarter of 1997, according to Grubb and Ellis Co.
“The Rosecrans Corridor has definitely heated up,” said Steve Solomon, senior marketing executive for Seeley. “Rents are going up, and we’re now able to charge for parking that’s a great plus.”
Solomon said that monthly rents in the area, currently $1.55 to $1.65 per square foot, should rise to about $1.90 per square foot over the next 12 months.
Solomon pointed to TRW signing a five-year lease for 150,000 square feet at Manhattan Towers and a relocation by the law firm Reback Hulbert McAndrews & Kjar from Century City to the Manhattan Towers.
The latter is significant, said Solomon, because it is one more indication that corporate executives who live in the South Bay “don’t want to drive to Century City anymore.”
El Segundo also saw some activity in the industrial sector during the first quarter, said Jim Biondi, senior vice president at Grubb and Ellis. He said Federal Express Corp. is currently in escrow to purchase 45 acres in El Segundo between Nash and Douglas streets. It plans to develop its regional distribution office headquarters on the site, including offices and freight-handling facilities.
Biondi said the vacancy rate for industrial space in the South Bay is at 7 percent its lowest point in 10 years.
Biondi attributed this to a reprieve in layoffs in the aerospace industry. “Large employers in the area are no longer laying off people. Hughes and TRW are both hiring,” he said.
El Segundo’s neighbor to the north the LAX/Century Boulevard submarket continues to experience the highest office vacancy rate in L.A. County. While the submarket did see a decrease in its vacancy rate during the first quarter, it still remains at 32.2 percent.
Despite the high vacancy rate, two large buildings in the submarket were sold last quarter. Arden Realty Ltd. bought the 300,000-square-foot Union Bank Center at 5200 Century Blvd. for $11.4 million and NAMCO Capital Group bought the 230,000-square-foot Imperial Bank Building at 9920 S. La Cienega Blvd. (also on the so-called Century Boulevard Corridor) for about $7 million.
Two buildings in the Century Boulevard Corridor were sold. Arden Realty Ltd. bought the Union Bank Center for $11.4 million and NAMCO Capital Group bought the Imperial Bank Building for $7 million.
Federal Express Corp. is in escrow to purchase 45 acres between Nash and Douglas streets in El Segundo.
TRW signed a five-year lease for 150,000 square feet at Manhattan Towers on the Rosecrans Corridor.
Continental Cablevision of Southern California expanded its office space from 30,000 to 50,000 square feet in the El Segundo Research Center located at 550 N. Continental Blvd.
Shamrock Holdings Inc. broke ground on its $77 million production studio complex on the Rosecrans Corridor.