Warner Center, already home to three major electronics stores, is an unlikely site for a fourth audio-video giant.
But casting conventional wisdom aside, Minneapolis-based Best Buy Co. is building a 58,000-square-foot facility at Victory Boulevard and Owensmouth Avenue in a move that business analysts say will be a boon to shoppers, but could also sound the death knell for small appliance stores in the area.
"When you have three existing stores and a new store comes in, the newcomer often comes in with very, very attractive prices," said Jack Kyser, chief economist with the Los Angeles County Economic Development Corp. "The existing stores cut their prices and the customer gets good deals."
With the entry of Best Buy, a one-half-square-mile area of Warner Center will become the electronics mecca of the Valley, which already boasts Circuit City, the Good Guys and Fry's Electronics in addition to smaller audio-video stores.
Best Buy is building its new store, its 18th in Southern California, on property it purchased from Rocketdyne International. The multimillion-dollar project is scheduled to open before Thanksgiving, according to company spokeswoman Laurie Bauer.
Industry analysts said the battle for customers will put the squeeze on small electronics retailers in the Warner Center area, and could even bring about the retreat of one of the big four.
"It's obviously going to put additional pressure on the few independent stores that remain there, that don't have the buying or advertising clout of Best Buy or Fry's," said Ronald Rotter, an industry analyst based in Calabasas. Smaller stores in the area include Affordable Portables on Canoga Avenue just south of Victory Boulevard, and Radio Shack in the Topanga Plaza mall.
The concentration of audio-video stores will make the Warner Center a convenient place for people to comparison shop before they sink their money into a stereo component or a new television set.
The Best Buy store is expected to create 150 new jobs in the area. The Rocketdyne plant in Canoga Park has lost 2,300 jobs since 1990.
Community leaders have expressed mixed feelings about the Best Buy store, with some saying it will make possible a productive use for a property that has lain fallow, and others concerned about traffic tie-ups due to the new development.
"When all was said and done, it was viewed as a positive contribution to the community," said Joel Schiffman, chairman of the West Hills-Woodland Hills Neighborhood Planning Advisory Council, which reviewed Best Buy's plans in April. Schiffman said the project had more than enough parking, would probably not cause significant traffic problems and would be well-landscaped.
But Gordon Murley, president of the Woodland Hills Homeowners Assn., said he feared that motorists making left turns onto and from the property would cause congestion and pose a traffic hazard. Murley said he hoped the city Department of Transportation would see to it that drivers are limited to right-hand turns as they enter or exit the property.
Schiffman said the advisory council considered whether the Warner Center already had too many major electronics, but ultimately decided that was not a concern.
The Los Angeles City Council approved a development agreement involving the city, Best Buy and Rockwell International--the parent company of Rocketdyne--that reduces the developer fee Best Buy will have to pay to help soften the traffic impact of its project. Best Buy will pay about $500,000 rather than about $1 million, Bernstein said, receiving fee credits because the number of vehicle trips generated by Rocketdyne employees has dropped sharply in recent years. The entry of yet another audio-video store also leaves Councilwoman Laura Chick unperturbed.
"We think it's clearly a good sign that many major chains are looking at the Warner Center area and the West Valley area positively," said Ken Bernstein, a planning aide to Chick, who represents the area. "There are a lot of things going on at the Warner Center. We've got the AMC theaters coming into the Promenade Mall. It's not as if it's totally electronics."