Western Real Estate Business

OCT 2016

Western Real Estate Business magazine covers the multifamily, retail, office, healthcare, industrial and hospitality sectors in the Western United States.

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www.REBusinessOnline.com Western Real Estate Business • October 2016 • 45 edy Central) and Fender Guitars to its creative office offerings. Its most recent tenant is Legend 3D, a virtual reality and 3D visual effects company that recently signed an 11-year lease for 27,000 square feet of space at the campus. The new lease will allow the com- pany to triple its existing operations, which are currently housed in two Hollywood locations totaling about 10,000 square feet. Legend 3D will re- locate about 100 of its local employees to Columbia Square this December after it completes a full creative build- out, which will include a state-of-the- art screening room. The company will use the space for post-production, technology development and market- ing functions. Legend 3D was rep- resented by Jacob Bobek and Aaron Wilder of Avison Young, who believe this type of space was the perfect fit for a forward-thinking, tech-savvy company. "Columbia Square is right in the center of the new Hollywood renais- sance," Bobek says. "The site was a perfect fit for Legend 3D as the com- pany is a fast-growing leader in 3D conversion and virtual reality. It was crucial to be located close to the com- panies Legend 3D serves and the best talent from a recruitment standpoint." A Great Value While some developers may hope to up their ROIs with a little help from history, others want to capitalize on unrealized potential. Yes, we're talk- ing value-add. Claymark Capital LLC went this route when it purchased a 118,842-square-foot creative office building at 12020 Chandler Blvd. in North Hollywood this June for an un- disclosed sum. The four-story build- ing is situated across the street from the Metro Orange Line, which con- nects from Chatsworth to Hollywood and Downtown. It is also less than one mile from the 101 (Ventura) Freeway, near the 170 and 405 freeways. The space is currently 77 percent occupied by entertainment tenants Pilgrim Studios and Screen Engine/ asi. It was most recently renovated in 2008, though the building has all the features in place for an ideal cre- ative conversion, including 14-foot slab-to-slab height, exposed ceilings and polished concrete. HFF's Andrew Harper executed the sale. The seller was PCCP LLC. Vantage Property Investors also employed this strategy when it pur- chased a 1970s-era office campus at 12777 W. Jefferson Blvd. in Playa Vista for $35 million in 2011. The firm re- tained Gensler to transform the for- mer Citbank ATM servicing facility, adding 20,000 square feet of connec- tive space that links the buildings and provides team spaces, work lounges and recreation areas frequently used by tenants. Five years later, that 11-acre Playa Jefferson creative office campus is home to building technology leader Arup, flexible workspace provider Regus, and advertising agencies Om- nicom and R/GA. It also serves as the Los Angeles headquarters for Face- book. The campus now contains four buildings totaling 200,000 square feet, with a fifth, 55,000-square-foot build- ing underway later this year. The new building will feature high ceilings, flexible floor plans and floor-to-ceiling glass windows that are now a stan- dard part of every creative office proj- ect. It will also include large outdoor spaces on each floor, with a 30-foot cantilever that faces Jefferson Boule- vard. Vantage also recently completed a five-story parking structure on cam- pus that can accommodate 617 cars. An affiliate of Rockwood Capital LLC snatched up this campus for $165 million — nearly five times what Van- tage paid for the outdated, first-gen- eration data center — this past July. Though it may have been a value-add opportunity of a lifetime for Vantage, Rockwood doesn't seem to mind its pricetag at all. Rather, the firm sees the long-term value in holding a pristine creative campus in the heart of Silicon Beach chalked full of ideal tenants. "The investment profile of Playa Jef- ferson was in perfect alignment with our long-term investment strategy," says Andrew Blanchard, Rockwood's managing director. "With the Runway Playa Vista [mixed-use community] located directly across the street, the property offers tenants an attractive array of easily walkable amenities. The ability to pair existing leased buildings with the development of a new modern office building provides an excellent blending of short- and long-term cash flow objectives." Capital can't get more creative than that. n Kilroy Realty's new 4.7-acre Columbia Square is a mixed-use campus that has attracted the likes of Viacom (MTV and Comedy Central), Fender Guitars and most recently Legend 3D. Vantage Property Investors retained Gensler to transform the former Citbank ATM servicing facility into Playa Jefferson by adding, among other things, 20,000 square feet of connective space that links the buildings and provides team spaces, work lounges and recreation areas frequently used by tenants. The 118,842-square-foot creative office building at 12020 Chandler Blvd. in North Hollywood is currently 77 percent occupied by entertainment tenants Pilgrim Studios and Screen Engine/asi.

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