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Real Estate Consultants Have Kept Busy Despite Recession : Growth: Some are involved in long-term projects while others have turned to corporate clients and public agencies.

Pamela Azar has spent the last seven years trying to get her Calabasas Promenade retail center built on vacant land at Las Virgenes Road and the Ventura Freeway. It took five years to get municipal approvals for a 190,000-square-foot retail stores and supermarket project, and Azar now is trying to line up tenants and financing.

Getting this far has cost Azar what she calls a small fortune and an army of consultants. Azar’s company, Malibu-based PAZAR Associates Inc., has had to hire a variety of experts, including an attorney, an accountant, environmental, civil and traffic engineers, an architect and a geotechnical scientist. An environmental impact report--required by planning officials and state law--cost several hundred thousand dollars, Azar said. “It is extraordinarily expensive. Consulting fees can easily run into several million dollars.”

Local development consultants, in fact, report that they have continued to stay busy throughout the recession in real estate. Some consultants have continued to work with developers on long-term projects, while others have concentrated on servicing corporate clients who happen to own real estate or government agencies that have vastly expanded their use of outside consultants in the last few years.

Sherman Oaks-based Kosmont & Associates Inc.--which has consulted for PAZAR--reports that it is doing less work for developers but more work for public agencies throughout California. Larry J. Kosmont says his firm is representing the Metropolitan Transit Authority in negotiations with the owner of a property in Van Nuys that the MTA wants to see developed as a retail project adjacent to a rail line. The MTA hopes to persuade the owner either to develop the property or sell out to somebody who will.

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Kosmont said he and his staff of 10 MBAs, lawyers and planners are concentrating on creating real estate-related economic development programs for cities, and in working with property owners who want favorable treatment from local agencies. Economic incentives offered by local governments are often negotiable, Kosmont said. So too are mitigation fees imposed on new projects. Kosmont said his role is getting the best deal for the client--whoever that happens to be. The company is also registered as a lobbyist with the MTA and the city of Los Angeles.

West L.A.-based Sedway Kotin Mouchly Group specializes in financial modeling of large projects such as Ritter Ranch in the Antelope Valley, assistance and advice to public agencies in dealings with developers and real estate-related market research, said Allan Kotin, senior principal.

Kotin said his firm has consulted for Oxnard in creating an assistance package for the developer of a factory outlet center. Palmdale hired Kotin’s firm of 22 professionals to research and consult on Ritter Ranch and several auto malls. Kotin also said he worked on a proposed rezoning of part of Warner Center on behalf of the property owners.

Kotin’s work is roughly split in half for private-sector and public-sector clients, he said. “Having our feet in both camps makes us more knowledgeable--as long as we don’t have a conflict of interest.” Rates for his firm’s consulting work range from $50 an hour for a junior analyst, to $200 an hour for one of the senior principals, Kotin said. Public-sector clients get an approximately 20% discount.

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Santa Monica-based Morey/Seymour & Associates reported that it charges between $70 and $225 an hour to help prepare environmental assessments and to guide clients through the bureaucracy of local planning agencies. “We do both lobbying and community outreach,” said partner Jeffrey A. Seymour. The firm’s seven planning professionals also work with clerks at various agencies to help move projects through the pipeline. Clients in the San Fernando Valley have included the Broadway Department Stores and Mrs. Gooch’s, Seymour said.

Julie Gertler, president of Consensus Planning Group Inc. in North Hollywood, specializes in getting local residents to support construction projects. Gertler reported that she is working for the owners of the Sherman Oaks Galleria to help get support from local residents for the addition of 13 movie screens and several new restaurants.

“Our job is to help the client figure out the community’s concerns and ways to address them,” Gertler said. So Gertler said she has met with a variety of groups, including Homeowners of Encino, Sherman Oaks Homeowners Assn., Encino Property Owners, Valley Industry & Commerce Assn., Sherman Oaks Town Council and the Ventura Boulevard Specific Plan Review Board. “We’ve gotten an earful. Nobody wants the changes to add to crime or traffic problems,” Gertler said. “It’s foolhardy for any development project to go forward without first consulting the community.”

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While business continues to be brisk for many real estate consultants, they all report that business isn’t as easy to get as it was a few years ago.

Santa Monica-based Psomas reports that it has cut its staff from 300 three years ago to 225 today. The 50-year-old company provides land development, engineering, environmental, surveying and mapping services through six offices in California and Oregon, said president Timothy Psomas.

Clients have included the Baldwin Co., which has housing projects in Thousand Oaks and Camarillo, and Kaiser Hospital in Woodland Hills--for which Psomas did site development work on a new wing and parking structure. Psomas reports that the company often works with attorneys and accountants on various projects--although many accounting firms and law firms now have their own thriving real estate consulting practices.

“The Los Angeles real estate market has been slow in coming back, but we have seen over the last few months an increase in the number of developers exploring new projects.” Psomas said. “The project teams are getting bigger and bigger and the specialists are getting more specialized.”

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