Aerospace Plants Reborn as Tech Parks
A pair of adjacent, long-idled Conejo Valley aerospace plants are springing back to life as technology-oriented business parks.
The new owners of the 100-acre former Northrop Grumman Corp. plant in Thousand Oaks just signed international telecom giant Alcatel to a $10-million lease for 200,000 square feet at one of the property’s remodeled industrial buildings.
That deal was done just as the property owners broke ground last week on mobile networking specialist Xircom Inc.’s similarly sized headquarters facility.
Paris-based Alcatel, which acquired Xylan Corp., will expand from Xylan’s Calabasas headquarters complex to the former Northrop plant along Rancho Conejo Boulevard.
Xircom is consolidating operations currently housed in three cramped facilities nearby.
The $50-million project, now known as Conejo Spectrum, is owned by a redevelopment team including Los Angeles-based real estate firm Investment Development Services and its undisclosed financial partners.
The Conejo Spectrum developers also just sold aerospace parts manufacturer Merex Corp. 2.5 acres for a $2.5-million facility to which it will relocate a group from Westlake Village.
Meanwhile, veteran local real estate developer Jack Hileman last week acquired the nearby 16.2-acre former Teledyne Electronics plant and will demolish two of the three existing buildings to make way for three new two-story Class A office buildings.
Hileman Co. purchased the Ventura Freeway-front property along Lawrence Drive from Realty Bancorp Equities for about $16 million and will invest another $25 million into the corporate campus, dubbed the Arbors.
The company will start with a 71,000-square-foot building slated to get underway during the fourth quarter and scheduled for completion next June. It has no tenants yet. The former Teledyne building that will remain is entirely occupied by semiconductor supplier Conexant Systems Inc.
Hileman said he sees burgeoning demand along the Conejo Corridor for top-notch office space--something that has rarely been built in the Thousand Oaks-Newbury Park area.
“There’s an opportunity to transform an aging and inadequate complex into a thriving campus for expanding technology firms,” he said.
Among other activities, Hileman’s company has been managing several noteworthy real estate development and redevelopment projects on behalf of Kearny Real Estate Co., which is affiliated with the Morgan Stanley Real Estate Funds. They include Pasadena Corporate Park and the new Infonet Services Corp. headquarters in El Segundo.
Brokerage services company CB Richard Ellis is handling leasing at the Arbors and also represented Alcatel and Xircom in the Conejo Spectrum lease negotiations and Merex in the property acquisition. Colliers Seeley’s John DeGrinis and Michael Tingus joined IDS professionals in all of the Conejo Spectrum negotiations.
David Mgrublian, managing director at Investment Development Services, said office, R&D; and industrial buildings all along the corridor stretching west from Calabasas are seeing strong user demand.
The $50-million, 327,474-square-foot Westlake North office complex that IDS is developing with Kennedy Associates Real Estate Counsel is already 60% leased--and the first building won’t open until September.
The latest market statistic suggest a robust Conejo Valley leasing environment. Grubb & Ellis Co.’s midyear report specifies that the Conejo Valley’s office vacancy rate is a tight 8.2%, with average asking Class A lease rates of $27 per square foot annually, exceeding all other markets within the greater San Fernando Valley vicinity.
In the industrial sector, Trammell Crow Co.’s midyear statistics indicate the Conejo Valley has an 8.1% vacancy rate (double the Los Angeles/Ventura County average), but nevertheless boasts the highest average asking lease rates in the greater San Fernando Valley market at $8.28 per square foot annually.
