For some time now, brokers in the San Fernando Valley have insisted that, faced with rising real estate prices on the Westside, companies will turn to the Valley as an alternative location for their offices. But it has always sounded more like a sales pitch than a reality. While there has not been any mass exodus to Valley office space, some recent indications suggest that, at the very least, dyed-in-the-wool Westsiders are taking a hard look at real estate over the hill. The latest is restaurant chain Sizzler International Inc., which has just signed a lease to move its corporate headquarters to the office garden in the Sherman Oaks Galleria. The company, currently located in Culver City, will occupy 22,000 square feet in the complex, a mixed-use facility currently under renovation. Sources peg the value of the 10-year lease at $7.5 million. Sizzler officials said they decided to explore a Valley location in an effort to find the most cost-effective solution to their space needs. The company has made its home on the Westside of L.A. since the 1960s. “It was probably, number one, value for the quality of the space,” said Chuck Boppell, president and chief executive officer of Sizzler. “Number two is a large portion of our employees have found the housing values and the schools were attractive on the other side of the hill and this cuts down the commute.” Sizzler employs 60-odd workers at its corporate headquarters, and in recent years a large percentage of them have been Valley residents. Rental rates have come down significantly on the Westside, due in large part to the demise of the dot-com industry. But much of the real estate that has become available is sublease space. “In the last six months, we’re seeing a lot of space come back on the market that’s much more competitive with the Valley, but because it’s sublet, it doesn’t include tenant improvements, so when you net it out, it’s a significantly more expensive proposition to be here (on the Westside),” said Boppell. The Sherman Oaks Galleria, which will include a number of restaurants and shops when it is completed, also offered the kinds of amenities the company was seeking. Sizzler, with sales of about $245 million, operates 350 Sizzler restaurants in the U.S. and other countries, 100 KFC outlets in Australia and 10 Oscar’s units domestically. The company returned to profitability after a restructuring in 1996. Tom Festa, Mike Hobbs and Drew Rifkin, brokers with Grubb & Ellis, represented Sizzler in the deal. A Swedish technology company, Digital Vision, has also decided to make the move from West Los Angeles to the Valley. Digital Vision has signed a lease for 3,390 square feet at 4605 Lankershim Blvd. in North Hollywood. The five-year lease is valued at $400,000. Digital Vision, which provides post-production, telecommunications and digital cinema products, will locate its North American headquarters offices in the new space. Robert D. Erickson with Cushman & Wakefield represented the tenant and the landlord, VDA Property Co. Westlake Sale What better way to celebrate a grand opening than with a sale? Investment Development Services Inc. has sold one of the Westlake North Business Park buildings to a Calabasas-based investment company. The largest of the three buildings in the park, a 137,760-square-foot office facility that houses Homestore.com, sold for $27 million. IDS recently held the ribbon-cutting ceremony for the complex, which is 60 percent leased. The other two buildings are not on the block, a spokesman for IDS said. Kevin Shannon at Grubb & Ellis represented the buyers, Miller Bros. Investments LLC, and the seller. New Tenant at Marquardt Moulton Logistics Management, a fulfillment services firm, has leased 108,000 square foot at Marquardt Industrial Park, the Van Nuys complex being renovated by Trammell Crow Co. Moulton will move its corporate headquarters from North Hollywood. The company, with 230 employees, anticipates expanding its workforce by about 20 percent over the next 12 to 18 months. Moulton moves into a building that was to have been leased to an Internet startup. That company, Enson Inc., abandoned its plans when it failed to launch as a result of the dot-com demise. Baxter Lands in TO Baxter Healthcare Corp. has leased 60,000 square feet at Conejo Spectrum, the Thousand Oaks business park under development by Investment Development Services Inc. Baxter will occupy a portion of a 130,000-square-foot building currently under construction in the complex. The company’s 10-year lease is valued at $5 million. Mark O. Leonard, an independent broker, represented Baxter in the deal. Dan Sibson and Rob Fuelling of IDS, along with John DeGrinis at Colliers Seeley, represented the landlord, Conejo Spectrum Building Associates LLC. Baxter will use the new facility, which it plans to occupy in 2002, for storage. Four Advance in Burbank Burbank city officials have narrowed the list of bidders for the redevelopment of the city’s old police station headquarters to four companies. Slated to make presentations to a subcommittee of the Burbank City Council are: a joint venture between CIM Group and Olson Development, L.A. and Seal Beach; Opus West Corp., L.A.; Trammell Crow Co., L.A.; and Avalon Bay Communities Inc. in Newport Beach. Eliminated were: Urban Residential Partners, L.A.; Chandler Partners in Burbank; Lambert Gangi Development, an L.A.- and Glendale-based partnership; and Southland Cos., Pasadena. The four finalists are expected to complete their presentations in the next few weeks, and a final decision is expected by early September. Burbank hopes to redevelop the 3.2-acre site bordered by Olive Avenue, San Fernando Boulevard, Angeleno Avenue and Third Street for residential and commercial use. Senior reporter Shelly Garcia can be reached at (818) 676-1750, ext. 14 or by e-mail at [email protected].
