Eastern Ventura County, which for years has been a strong office market, is starting to pick up in the retail side as well.
The Simi Valley City Council in September approved what will be the city’s largest-ever retail complex, which will house a Wal-Mart, Home Depot and several other smaller tenants and restaurants, according to Reed Henkelman, vice president with CB Commerical Real Estate Group Inc.
“West Ventura County (Oxnard, Ventura and Camarillo) has had the big retailers like Costco, Target and Comp USA,” Henkelman said. “But now they’re going into the east county, which is catching up.”
Santa Monica-based Rothbart Development Corp. has received city and planning commission approval for the project.
The project is moving forward in part, brokers say, because the east county’s retail vacancy rate is at 4.9 percent, down from 5.2 percent at the end of the second quarter.
That makes it tighter than the west county, which has an 8.2 percent retail vacancy rate, slipping from 7.6 percent in the second quarter.
Bill Hagelis, vice president of retail properties for Capital Commercial Real Estate in Oxnard, attributed the rise in the west county vacancy rate to new retail projects coming on the market not to slackening demand.
As for Ventura County’s industrial market, brokers say it is basically strong, even though the area’s vacancy rate edged up from 8 percent in the second quarter to 9 percent in the third, according to CB Commercial.
Harry Preston, the Ventura office’s first vice president, attributed the rise to an old 500,000-square-foot building coming on the market during the third quarter.
The vacancy-rate rise belies the fact that in most cases, newly built industrial spaces in Oxnard and Camarillo are snapped up before they are completed. This was largely the case, Preston said, with three speculative buildings built at the McInnes Ranch Business Park in Oxnard, developed by the Sares-Regis Group.
One building was leased before its July completion, another was leased just as it was finished that month and a lease is now close to being signed for the third, he said.
As for the office market, the east county, especially Westlake Village, continues to outperform the west county.
The east valley office vacancy rate slid to 8.4 percent in the third quarter, down from 10.3 percent in the second quarter, said Cheryl Richmond, an associate with Capital Commercial Real Estate in Westlake Village.
Office vacancies in the west county, meanwhile, were at 18.7 percent in the third quarter, still relatively high but down from 19.4 percent in the second quarter.
“There’s a lot of good product still available in the west county because a lot of big defense contractors are not there anymore,” Richmond said.
As expected, office rents continue to be considerably higher in the more-popular east valley areas.
Prime space in Westlake Village, for example, goes for $2 a foot per month, while comparable space in Camarillo and Oxnard goes for about $1.35.
Richmond and other brokers say there is strong interest in east county office buildings from investors, but there are no buildings left that have “upside potential” for investors to buy, fix up and resell at a nice profit.
The dearth of available office buildings is one reason Washington, D.C.-based real estate investment trust CarrAmerica Realty Corp. got into a bidding contest, which it won, to purchase a 77,000-square-foot office building in Westlake Village. The price of the deal, which closed in the third quarter, was not publicly disclosed.
Investor competition for properties has driven up prices in the east county and this trend may follow in the west.
Bill Kiefer, executive vice president of Capital Commercial in Oxnard, said investors are very active in the area because purchase prices for many buildings are still below replacement costs, and new speculative office development is not expected until next year or 1999.
Major Events
The city of Simi Valley approved the construction of a shopping center on Madera Street near the Simi Valley (118) Freeway. It will include a Wal-Mart, Home Depot and other tenants.
Templock Corp. leased a 28,000-square-foot industrial space and Public Storage Inc. leased a 43,848-square-foot industrial space at McInnes Ranch Business Park in Oxnard.
The 51-acre Northrop Grumman Corp. facility in Thousand Oaks went into escrow to be purchased by an unnamed buyer, but then fell out of escrow. The property is back on the market.
Washington, D.C.-based CarrAmerica Realty Corp. closed escrow on a two buildings with 77,000 square feet of office space in Westlake Village.
M.F. Daily Home Ranch Partnership Ltd. of Camarillo paid $3.2 million for a 40,000-square-foot office building in Camarillo. The seller was William Meeker.
