Shamrock Plaza Professional Office - Agoura Hills & Calabasas Chamber Event

Los Angeles Class A Office Vacancy Recovery! Are We There Yet?

Optimism is echoed as compared to the previous quarters by many office investors and business owners. A recent leasing survey by local real estate professionals show lease transactions consummating but at a steady and slow pace. Renewals by Tenants are keeping the vacancy factor constant as long as Tenants are not leaving. We are not seeing many new businesses located in the local area making sideways moves. Many Landlord Leasing Representatives are targeting quality tenants located just outside the local market in hope of brining them in. Businesses that have weathered the storm by now, are able to take a slight breath as the overall sluggish economic moves in a positive direction but at snails pace.  Construction has yet to be seen, however there is buzz out there that projects are going to begin. 

Los Angeles Business Journal Article

San Fernando Valley & Conejo Valley 1st Quarter Office and Industrial Market Report

The San Fernando Valley and Conejo Valley leasing market continues to slowly move forward. Landlords are trying to keep LEASE RATES as high as possible. In turn giving tenants free rent to mitigate the difference in asking rates verses actual lease rate. Short term deals in AS-IS condition is very common to smaller types of tenants. Tenants are still shopping the market to use as a negoiating tool as their lease comes closer to it's end.  The renewal lease market is still very strong but at discounted rates and a lot of free rent.    

Click on the Full Report Link below to see the entire 1st quarter report.

San Fernando Valley Office Asking Rates 

Full Report

San Fernando Valley Industrial Asking Rates

Full Report

Ventura Office Asking Rates

Full Report

 Ventura Industrial Asking Rates

Full Report

28720 Roadside Dr, Agoura Hills "Shamrock Plaza Office" The Name

Shamrock Plaza is located in the heart of Agoura Hills situated just off the 101 Ventura Freeway between Kanan Road and Las Virgenes Road exits. 

Shamrock Holdings Inc. was the firm founded by Roy E Disney, a family investment firm. The Disney family still remains the major shareholder of this firm.  Shamrock Holdings Inc. owns a variety of assets including radio, television stations and a number of real estate assets.

In 1985, Shamrock Holdings Inc., began construction of the Shamrock Plaza. Hence the name.

Agoura Hills Office Space for Rent Virtual Tour - Shamrock Plaza

28720 Roadside Drive, Agoura Hills Shamrock Plaza is centrally located in the Conejo Valley and is nestled against the beautiful backdrop of the Santa Monica Mountains. This modern office building, built by the Disney Corporation features medical and office suites, ample free parking, abundant widow line, and has a variety of spaces to fit your office needs.  

San Fernando Valley & Conejo Valley Landlords vs Tenants

 

2011 still has its challenges ahead for our economy.  I don't expect things to ease up a bit, but I do think our economy is slowly getting better. Still there is a lot of uncertainty with new and exisiting businesses. This uncertainty with businesses are very appearent in the San Fernando Valley and Conejo Valley and the leasing market reveals this truth.  Long term leases are challenging for majority of new and growing businesses and negotiating lease terms has been no easy ride.

Landlords need some incentives in this market to get their vacancies leased up.  1 month rent abatement per year, 6 month teaser rates, free parking, tenant improvement allowance and an active broker willing to work are some successful elements in this market. In the San Fernando Valley and Conjeo Valley market, there are still too many vacancies to raise rents much further. Creative rent structures is another creative element is consummating a new lease. Its not unusual to see a flat lease for the next few years either. 

Tenants getting closer to lease end have been beginning to tour the market place about a year to six month in advance to see where they can strike a deal. I convey to each tenant that every landlord has a different business model. Whether their model is occupancy percentage, credit tenancy, price per square foot for rent, etc. makes its difficult for some tenants to understand that even though there is vacancy in their local market place, landlords may not necessarily budge where tenants would like. I let each tenant I represent know that the only way to find out where the landlord is will to make a deal is by requesting a lease proposal and negotiating.

Majority of the time, unless specific reasons other than rental price, most tenants will continue to renew their lease. $.10 per square foot isn't really going to make much of a justification to move unless they are a small tenant.  It's typical for tenants to tour the marketplace and to have found themselves back at thier exisiting space renewing their lease for another few more years with some incentives like free rent, new carpet and paint.

For Landlords, it can be very advantagous to consider early lease renewals for tenants. Why? The known is better than the unknown and diminishes the risk of losing a credit worthy tenant. It's easier to control costs like improvements to space, commissions, loss of income for vacancy, and overall real estate costs associated with time. 

But the only really way to know if you had a good lease is only after the lease is over.   

San Fernando Valley Lee & Associates - LA North/Ventura News

Here we are on Bisnow.

http://www.bisnow.com/

Growth Forecast in our Economy

Perception is that our California economy has reached the bottom!

 Are there signs of real optimism? 2012 looks like a turning point in our economy, or is it?  

* Business spending accounted for majority of growth.

* Employment less than impressive.

* New home development has not seen a rebound yet.

* 2010 banks will have taken over 1.2 million homes. (Is a double dip rececssion in the housing market on its way? Banks are slowly moving inventory to prevent a major drop in the residential housing market. The next 3 years will be interesting)

Class A Properties are continuing their run up in prices and low cap rates as investment group are bidding up the prices trying to take advantage of this market. All other classes are still struggling and will continue to have its challenges this year.

Allen Matkins/UCLA Anderson Forecast California Real Estate Survey

California Real Estate Survey

San Fernando Valley Office & Industrial 3rd Quarter 2010 Market Analysis

Leasing Velocity Remains Steady, But Absorption Weakens

Q3 2010-LAN Office 10-10

Leasing Volume and Sales Prices Rise, Improving Absorption Rates

Q3 2010-LA Industrial 10-10

Commercial Real Estate Deals Getting Done!

Compared to last year, Buyers are getting off the sidelines and refocusing on acquiring deals.  It just makes sense to buy a property as an Owner User if your intension is to hold on to it for the next 5 to 10 years.  The market has come down significantly since the peak of 2007 and many potential Buyers that were once on the fence to purchase now see more opportunity than ever.  As a stable or growing businesses, it looks like you're in luck as rents have come down significantly and the opportunity to buy as an owner user is tremendous.  The SBA financing market is a driving force to the amount of sales transactions we are seeing today.  

Sellers that have to dispose of their assets will find a challenging market ahead of them.  Until traditional financing comes back to the marketplace, creative financing is the only option.   Unfortunately as a Seller trying to unload a property that has signs of becoming distressed will certainly face competition against some of the toxic bank assets that are now being forced to sell on to the open market with realistic prices. 

I've been tracking some of the banked owned properties for the past year now and those that went into distress about a year ago are now being sold. For some of the Banks that tried the "Pretend and Extend", the reality is that some of the distressed assets have no other option than to be sold at a loss.

See what Lee & Associates LA/North has recently sold and leased on the link below. 



Still On The Fence

Commerical Real Estate Capital Gain Taxes Going UP

This coming January 1, 2011 the capital gains tax reduction signed under President Bush will revert back to the former 20 percent capital gain tax rate prior to 2003.

Thinking about Selling and cashing out. Take advantage now and close before the year-end.

San Fernando Valley Office & Industrial 2nd Quarter 2010 Market Analysis

Leasing Activity Jumps; Pushes Absorption Into Positive Territory

Q2 2010-LAN Office 7-10

Leasing Momentum Continues and Sales Activity Increases

Q2 2010-LAN Industrial 7-10

Eric Nishimoto

Eric K. Nishimoto, an associate at Lee & Associates-LA North/Ventura Inc., a full-service commercial real estate company and member of the Lee & Associates group of companies, specializes in investment brokerage throughout the Los Angeles area with a focus in the San Fernando and Conejo valleys. A seasoned sales and marketing professional, Mr. Nishimoto’s real estate expertise includes the pricing, underwriting, leasing and sales of retail, industrial and office properties as well as the development of long-term investment strategies for his clients.