Real Estate—Developer of Warner Center Scales Back Valley Presence

Call it the end of an era, officially, sort of. The Voit Cos., developer of most of Warner Center, is downsizing its corporate headquarters in Woodland Hills into what, for all intents and purposes, is a service office. The move reflects the shifting interests of the company to points south and east. President and CEO Alan G. Epstein, hired only a year ago, has left the company, along with longtime executives Bob G. Lumley, vice president for development and construction, and Executive Vice President Jim Muth, sources said. A spokeswoman for Voit on Oct. 25 downplayed the moves, saying the completion of the industrial park on the old General Motors site in Panorama City led to the departure of one construction manager and a project manager from the office. “However, Voit Development Co. is continuing a strong development focus,” said Judith Brower. “The company’s next major projects are in Brea, La Habra and Anaheim, all of which are being handled from the firm’s Newport Beach office. Voit Development continues to be involved in the San Fernando Valley.” Brower would not comment on the departures of the executives, saying instead that the company plans to hire a paralegal and an administrative assistant for the office. However, a number of sources in the West San Fernando Valley real estate community said they regard the remaining employees at the office as a skeleton crew that will largely be charged with overseeing what is the only remaining Voit project in the Valley, the Marvin Braude Constituent Center in Van Nuys. Company founder, Chairman and CEO Robert Voit developed most of Warner Center back in the 1970s. Since then, however, the company has sold most of its properties and focused its attention on development in Arizona and Orange County. The last large development Voit completed in the Valley was the General Motors industrial complex in Panorama City, but the company’s name has managed to remain synonymous with Warner Center and Valley real estate. Now however, many observers reason that, with so little space available for development in the Valley, it would be difficult for the company to remain a dominant name in the region. LNR Shoring Up First Phase While the downturn in the real estate market has not yet resulted in a large-scale drop in lease rates, one landlord is reducing the rental price on a 20,000-square-foot block of space. LNR Warner Center has dropped the rental rates on the remaining space for one of the buildings in the complex under development to $2.35 to $2.50 per square foot, down from about $2.60 per square foot. LNR, which has been redeveloping the Prudential office campus at Canoga and Burbank avenues, has leased most of the space in the first phase of the project, and about half the space in the second phase, which is still under construction. But officials said that, with the market showing signs of softening, they decided to move to lease the remaining space in the first phase quickly so that they can concentrate on the new buildings underway. “If the market weren’t so tight, we probably wouldn’t do it,” said Kevin Read, vice president of acquisitions for Lennar Partners. “But it doesn’t make sense for us to sit on this space and have it be non-income-producing. It’s nice not to have Building A space compete with Building C space.” Building A, a 92,000-square-foot facility to be built in the second phase of the redevelopment, is still commanding rates of $2.60 to $2.70, Read said. The company has pre-leased about half the building to Univision Music Group, a division of Univision Communications Inc., which is taking about 16,000 square feet, and First Union Bank of California, which will occupy about 30,000 square feet. LNR has also begun leasing a retail complex, which will also be part of the second phase of development. Read said he expects to complete three leases shortly and have the 10,000-square-foot retail building completely leased by the end of the year. Construction on both Building A and the retail center is due to be completed sometime next summer. Travel Plans Brendan Tours Inc., an operator that specializes in the South Pacific and European travel, has acquired a 40,000-square-foot facility in Chatsworth. The purchase price for the building, located on 1.9 acres at 21625 Prairie St., was $3.7 million. Brendan, which is relocating from Van Nuys, will double the size of its facility with the move. The worldwide tour operator plans to use the facility for its headquarters offices. About 140 workers will be employed at the site. The deal was set in motion long before the events of Sept. 11 turned the travel and tourism industry upside down. But Brendan officials were cautiously optimistic about their situation. “It puts us in a situation that if things turn around within the next six months, it will be no difficulty,” said Jimmy Murphy, chairman and CEO of Brendan Tours. “If they don’t turn around, we’ll have twice as much space as we need.” Murphy said the company’s business was down about 50 percent in September and October and 25 percent since the beginning of the year. But Brendan Tours has weathered other crises, and Murphy said he is hopeful this too will pass. The real test will come in January and February, the traditional time for bookings to Europe, which accounts for a large portion of the company’s business. “We were around when the Gulf War happened and when we had the bombings in Rome and, if you remember, the killing of the tourists on the Achilles Lauro,” said Murphy. “Americans are resilient travelers. It will turn around.” Jerry Scullin, a broker with Delphi Business Properties, represented Brendan Tours. Nick Gregg and Barbara Emmons of CB Richard Ellis represented the seller, ProLogis. Senior reporter Shelly Garcia can be reached at (818) 676-1750, ext. 14 or by e-mail at [email protected].