Trillium Beats Out Rival for Transamerica Group Lease

Score one for Norman J. Kravetz.

The managing partner of the Trillium complex in Warner Center won a round over archrival developer Robert D. Voit last week, snaring a major corporate tenant to fill more than half of the 17-story office tower under construction on the Trillium site.

What’s more, Kravetz’s deal with Transamerica Insurance Group appears to be the biggest office lease ever in the San Fernando Valley. Transamerica signed a 10-year agreement for about 10 floors of the tower, which will be a twin of the existing one at the budding complex on Canoga Avenue between Erwin Street and Victory Boulevard.

Transamerica Insurance, the property casualty insurance subsidiary of Transamerica Corp., said it will use the space for 650 employees now based in its downtown headquarters at 1150 S. Olive St. Transamerica said it expects to move in mid-1988.

Terms of the deal were not disclosed. Industry sources estimate the 170,000-square-foot lease to be worth about $4 million a year, or $40 million in all.

Leasing a large chunk of an unfinished office building is unusual in metropolitan Los Angeles, especially in the Valley, and Kravetz signed Transamerica Insurance even though the company reportedly was close to signing with Voit for a nearby building he is planning.

Voit, who could not be reached for comment, is the developer responsible for the Warner Center Plaza, a partly built complex straddling Owensmouth Avenue between Oxnard and Califa streets. He also is developing Warner Center Business Park east of Canoga Avenue and south of Oxnard.

Kravetz and Voit were at odds last year when Voit unsuccessfully tried to block city approval of a 340-room Hilton Hotel that Kravetz plans for Trillium. Voit’s development includes the Warner Center Marriott.

The Valley has had bigger real estate deals than Transamerica’s, but none consisting entirely of rented office space, said John Battle, a vice president with Beitler & Associates, a real estate firm in Sherman Oaks.

Transamerica is the second big tenant to sign a lease for the Trillium complex. In August, Weyerhaeuser Mortgage Co. announced that it is taking 110,000 square feet in the existing east tower of the development, which is now 70% leased, Kravetz said. That deal was worth more than $28 million.

Gerald A. Isom, president of Transamerica Insurance, said his company and its sister concern, Transamerica Occidental Life, are sharing quarters downtown, and both needed more space.

Isom said he decided to move from downtown to get better office space at a lower overall cost, taking into account the expense of parking and commuting. Transamerica has been looking for new offices for about a year, the company said.

Kravetz said that groundwork has begun on the building and that the tower is expected to be completed in early summer of 1988. He said the twin, 17-story towers eventually will be joined on the Trillium site by shops, restaurants and the Hilton. In all, it is billed as a $165-million project.

Kravetz and Isom would not discuss terms of the deal, other than to say that Transamerica received no ownership interest in the building, a common enticement for large tenants. One source said the transaction is so secret that when it was made, the realty agents for both sides were asked to leave the room.

The Faulkner Co. represented Kravetz, who is known as an aggressive deal maker. Transamerica was represented by Tishman West Management.