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Thursday, Mar 28, 2024

Business Park Making Way For Housing

Business Park Making Way For Housing By SHELLY GARCIA Senior Reporter With a seemingly boundless demand for housing, another developer is having a change of heart over plans to develop a commercial project. The principal of Royal Clark Development has partnered with the land use attorney the firm has worked with extensively and is readying a proposal to turn over the remaining nine acres in the Cascades Business Park in Sylmar for residential use. The partnership, Cascades Park Properties LLC, is still working through the details of its proposal to the city with respect to the type of multifamily housing and the density, along with the broad strokes of how it would look and the infrastructure that might be required, all preliminary steps required before an application for rezoning the property can be made. But company officials say they expect to begin their application process before the end of the year. “The industrial and business park market out there has been OK, but there’s such a demand for housing, and this property seemed ideal for it,” said Mark Armbruster, a principal of Westwood law firm Mark Armbruster & Associates, who has partnered with Tom Clark, principal of Royal Clark Development for the project. (Clark was on vacation and unavailable to comment for this story.) Royal Clark has been developing the Cascades Business Park, a 66-acre industrial complex with an 18-hole championship golf course, since the late 1990s. The company has been marketing land and build-to-suit facilities on the property, and so far, some 1.2 million square feet is built out, representing all but two parcels. With a roster of tenants that includes Frito-Lay, a Sears distribution center and Brooks Automation, the project has on the whole been successful, but the market has changed considerably since Royal Clark began work on the land. Back in the late 1990s when Royal Clark began construction, developers believed there was a burgeoning demand for upper-end industrial space, as evidenced by how quickly The Plant in Panorama City drew interested buyers and tenants when it was under development about the same time. Several other developers jumped into the market only to find that the large companies they were targeting were not lining up to spend what could amount to twice as much or more for these upgraded facilities. Immediate demand It has taken the Cascades, for example, a number of years to fill most of the industrial space available, whereas housing demand is both strong and immediate. “There’s really a higher value on multifamily land (now) and there’s definitely a need,” said Barbara Emmons, a broker with CB Richard Ellis, who has been marketing the business park along with CB’s Greg Barsamian, Greg Geraci and Scott Wilcott. The team would not be involved in the multifamily project if it goes forward. Although demand for housing has been increasing steadily as the market for commercial facilities has waned, only a few developers so far have successfully navigated the business of rezoning parcels for residential use. J.H. Snyder Co. revised its initial plans to build office space in Agoura Hills and is currently under development with a multifamily project that includes some offices. And a number of years ago, Katell Properties applied for and received a zone change for a planned office complex on Warner Ridge. Since then the Woodland Hills parcel was acquired by Legacy Partners, which is under construction for a community of townhomes dubbed Bella Vista. But for many other developers the opportunity to switch to a residential project is limited by the land itself. Most of the available parcels of land in the San Fernando and surrounding valleys were previously occupied by manufacturing companies that left polluted soil in their wake. Remediating these parcels to levels acceptable for housing can be so expensive it is impossible to recoup the costs. Agricultural land Cascades, on the other hand, was never built out until the Royal Clark development began. The land had belonged to a family and was originally zoned for agricultural use. The housing would be located between Foothill Boulevard and Balboa Boulevard at the southwest corner of the land parcel, an area separated from the industrial development by a hillside that runs roughly north and south through the property. It is also minutes away from the golf course, the city’s only private course open to the public, another strong selling point for the units, the developers say. “We think the nine acres being so close to the course you could hop in your car and be there in two minutes, where else can you do that?” Armbruster said. At the same time, Sylmar has proven to be a highly desirable residential locale, thanks to its proximity to freeways and a Metrorail line and the serene, hillside topography of the area. In the past few years, home builders have developed a number of housing tracts in the community. KB Home, with American CityVista, has built more than 400 moderately priced homes in the area. “The Sylmar community has been a strong residential community,” said Armbruster, “and we think this will do nothing but enhance that area.”

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