20th Century Weighing Warner Ridge : Office space: Woodland Hills auto and home insurer reportedly considering a move to the mixed-use development after current lease expires in 1995.
The contest among big West Valley developers to sign a coveted tenant to a new lease appears tilted in favor of Warner Ridge Associates, a controversial developer that won a lengthy legal battle with the city of Los Angeles earlier this year.
20th Century Industries Inc., a Woodland Hills auto and home insurer whose current lease for more than 200,000 square feet at an office building on Owensmouth Avenue in Warner Center expires in November, 1995, is reportedly in serious talks to move to the proposed Warner Ridge mixed-use development, also in Woodland Hills near Warner Center. Industry sources said the insurer is seeking more than 350,000 square feet.
Officials at 20th Century acknowledged that the company received a letter of intent for the Warner Ridge lease but would not say whether the agreement had been signed.
Richard Dinon, a 20th Century senior vice president, said in a statement that “no final decision has been made in regard to 20th Century’s expansion or relocation plans.”
Jack Spound, whose Los Angeles-based Spound Cos. is a partner in Warner Ridge, would not discuss the status of negotiations with 20th Century. But he said that 20th Century is “definitely included in the group of tenants we’re talking to for pre-leasing. They are the ones we’re most interested in landing.”
Spound said that there are currently no binding lease agreements for Warner Ridge. He said the first phase of the project--which is slated to include 420,000 square feet of office space--must be substantially pre-leased before financing arrangements for the development are finalized. Spound’s partner in Warner Ridge is Johnson Wax Development Co., an affiliate of consumer products giant S. C. Johnson Wax in Racine, Wis.
20th Century has long been considered the biggest prize among a handful of major tenants looking for large blocks of office space in the West Valley. Another sought-after tenant, Health Net--the state’s second-largest health maintenance organization--committed in March to a 10-year lease at Warner Plaza I, the building that has served as its corporate headquarters since 1983.
The owner of Warner Plaza I is Voit Cos., Warner Center’s largest developer. Health Net’s new lease will give the HMO another 40,000 square feet on top of the 137,000 square feet it currently leases from Voit, making it Warner Center’s biggest tenant.
But Voit would also like to snare 20th Century for its Warner Plaza III, a 600,000-square-foot office tower that has remained empty since it opened last November.
John Gebhardt, a Voit vice president, said the company has had talks with several potential tenants, including 20th Century, and noted that until an agreement is finalized, the insurer is up for grabs.
“Until they’re in and occupied, I don’t think it would be safe to say it’s a done deal,” he said.
The partnership that owns 20th Century’s current headquarters building also hopes to sign the insurance company to a new lease. The managing general partner is a Tishman West Cos. partnership. Metropolitan Life Insurance Co. and Prudential Insurance Co. of America are also part-owners of the building.
Alan D. Levy, president of Tishman West, said he wants to construct another building next door to accommodate the insurer’s expansion needs. But those plans have been held up while the city studies proposals to rewrite the Warner Center Specific Plan that would govern future development in the business center.
20th Century has also reportedly had discussions with the developer of a Calabasas complex called Calabasas Park Centre.
Landing 20th Century as a tenant would be the second big victory for Warner Ridge this year. The battle over the proposed project heated up in 1988, when Councilwoman Joy Picus, responding to her Woodland Hills constituents who opposed the development, moved to block its approval.
The developers sued the city in 1990 for $100 million, alleging that Picus’s opposition was politically motivated. In January, the city agreed to settle the lawsuit after several court rulings essentially agreed with the Warner Ridge developers that the city had illegally changed the zoning at the site to stop the project.
Under the settlement, the city agreed to let the developer build an office complex on the 21.5-acre property at the northeast corner of De Soto Avenue and Oxnard Street, and to provide Warner Ridge with $4 million in municipal services. The $200-million mixed-used project now calls for five office towers totaling 671,000 square feet, 19,000 square feet of retail and restaurant space, two five-story parking garages and 125 condominium units in three buildings.
The Los Angeles Planning Commission is due to hold public hearings on the project during the first part of August, and the entire development is expected to go before the City Council in September.
If everything goes as planned, ground will be broken on the initial phase in December or January, Spound said.
