Grade ‘A’ Space At School Sites

When school ends in June, it will also be the end for private chain Pinecrest Schools. At points in its 65-year history, the Sherman Oaks business operated 10 campuses and taught 6,000 students throughout L.A. and Ventura counties as the country’s largest family-held private school system. But Pinecrest is closing what’s left of its five campuses because it is no longer able to keep its tuition flat amid rising costs and a changing education climate, which has broadened to include charter schools and other forms of learning, according to the chain’s family owners and operators, who announced the closure last month. Depending on what Pinecrest decides to do with its properties, potentially 147,000 square feet of buildings and more than 25 acres – an approximate total of its main buildings and campuses sizes based on figures from real estate data firms – could go on the market for sale or lease. The company owns campuses in Woodland Hills, Canyon Country, Thousand Oaks, Simi Valley and Moorpark, and is aiming to keep them as schools, Pinecrest Chief Executive Jeri Dye Lynch said in a letter to parents about the closures. The properties might not be on the market for long. Several charter schools operating in areas near Pinecrest locations have their eyes on the sites and some have said they would be interested, according to the schools and other sources. But eager developers, zoning issues and a lack of land for development might make the sites more valuable for other uses, including housing. Scarce school land School buildings and their land can be highly desired for several reasons. Schools qualify as a high-density use, so city codes demand they have more parking than any other use except fitness centers, said Stacy Vierheilig-Fraser, senior managing director at real estate firm Charles Dunn Co. in Sherman Oaks. Plus, interior building modifications can be made fairly easily. If cities allow more uses and relax issues on height, density and setback amounts, that could attract housing developers in addition to schools among those eyeing the sites. “It all depends on zoning and what the plan is for that particular area,” she said. “You don’t see schools turn over very often, so it’s hard to say, but if someone is looking, they’re going to be all over that.” Pinecrest grew up along with the San Fernando and Conejo valleys. Founder Edna Mae Dye opened her first school in 1951 in Van Nuys as San Fernando Valley’s first private school. Subsequent family members expanded the chain west and north, following residents into eastern Ventura County and the southern Antelope Valley. The chain owned most of those campuses, and opened and closed several to follow residents into up-and-coming areas. Pinecrest’s sweet spot was children from 18 months to eighth grade. It marketed itself as an affordable quality education. This year’s tuition ranges from $9,500 to $10,750. The business began shutting down campuses last year with two schools in leased buildings in Lancaster and Northridge. The Lancaster school closed because it was unable to renegotiate its lease, a Pinecrest spokeswoman said, while the Northridge campus closed because the property owner chose to sell the land before the lease expired. Both were unrelated to the current issues, she added. Pinecrest owner and Chairwoman Barbara Dye said in a statement that for 65 years, the schools provided a unique option in the greater L.A. market but that “changes in education and escalating costs have exceeded our ability to continue to operate Pinecrest without significant increases in tuition.” There are at least 75 charter schools in Los Angeles County and about 14 in Ventura County, according to the state’s Department of Education, and that’s not counting private, religious, trade and medical schools. Operators among those sectors comprise the potential buyers pool for Pinecrest’s holdings. Colliers International Senior Executive Vice President John DeGrinis said he got a hint of the demand for school space when he recently brokered the sale of a 12,000-square-foot private school on 3 acres in Woodland Hills that had educated students with disabilities. He said many types of schools – kindergarten, day care and others – were interested because of the amount of land that could have enabled several different uses, such as a community center or club headquarters. It sold to an Israeli-American organization in September for $3.6 million. “The diversity of uses that can fit into these properties is very, very deep, so if properly priced, (the Pinecrest schools) will absorb quickly into the market,” DeGrinis said. “They’re going to be in high demand both for redevelopment and for (schools) to use them.” Other brokers say they see charter and private schools pursuing properties across the San Fernando, Conejo and Antelope valleys. Solo broker Jason Zink, whose market includes Lancaster, said he has noticed charter and private schools taking space in shopping malls or old school campuses in Palmdale. Charles Dunn’ s Vierheilig-Fraser said she has seen the trend pick up from charter and trade schools in the San Fernando Valley over the past three years. Trade colleges often take between 20,000 and 40,000 square feet. Her office in December sold a 16,200-square-foot school on 2 acres in Woodland Hills for $3.5 million to El Camino Real Alliance, a nonprofit that manages El Camino Real Charter High School. “They usually have to go to the north and in less-dense areas because they need bigger pieces of land,” she said. “Everything closer in is very tight.” Prime properties Several charter schools are on the hunt in Simi Valley, according to Brian Gabler, the city’s director of economic development and assistant city manager, a trend he has noticed over the last two years. “The lack of available real estate has been a stumbling block to locating in the community,” Gabler said. “And with the potential availability of the Pinecrest campus, that might be an opportunity for the charter schools to locate here.” Charter schools themselves say they’re interested, although some are still bound to existing leases. Pinecrest’s Thousand Oaks campus has caught the eye of several interested parties, said Claudia Weintraub, director of River Oaks Academy Charter School in Westlake Village, including her own. “I probably would be interested in such a space in the Oxnard-Ventura area, as we are trying to open up a second facility in that area,” Weintraub said. “I am not sure what the cost of this facility is per month, but depending on that, we would be more than interested in finding out and possibly having a look at it.” Also in Thousand Oaks, Jay Guidetti, executive director of Bridges Charter School, said, “Bridges has a definite interest in exploring a long-term lease or ownership of property.” But Pinecrest’s Simi campus could be gold for eager housing developers. Schools are an allowed use for the parcel but so is residential housing, said Gabler. The 33,000-square-foot school sits on nearly 5.5 acres, according to Vierheilig-Fraser. “If it goes up for sale, it’s going to have a lot of residential developers interested in that property,” Gabler said.