Tenants are fighting to get into the ground floor of Century City’s newest high-rise, even though completion is more than a year away.
Comerica Inc. signed up for a ground-floor bank branch and office space at 2000 Avenue of the Stars in a 15-year lease worth $32.8 million.
And the leasing agent, Trammell Crow Co., is nearing a 12-year deal worth up to $7.6 million with Fidelity Investments Institutional Services Co. for a 10,600-square-foot ground-floor space.
Calls to Trammell Crow weren’t returned. The firm manages the project for JPMorgan Chase & Co., which owns the buildings through pension fund clients. Comerica spokesman Alfredo Padilla said a deal was pending but declined to comment further.
Comerica outbid City National Corp. for the ground-floor branch, according to sources close to the deal, paying $5 a foot triple-net for a 6,667-square-foot branch, for a subtotal of $6 million. Comerica also paid $4.25 a foot triple-net for 35,000 square feet of office space, for a subtotal of $26.8 million.
The site of the new 2000 Avenue of the Stars complex had been home of the former ABC Entertainment complex, which also housed the Shubert Theatre.
Meanwhile, Fidelity plans to move to the building from its current offices at 10100 Santa Monica Blvd. It would pay $5 a foot triple-net for its ground-floor space.
These rates are substantially higher than average Century City office rents. At the end of June, landlords, on average, were asking $3.09 a foot, according to Grubb & Ellis Co.
While there is still a glut of office space on the Century City market, ground floor retail space remains at a premium.
CB Richard Ellis Inc.’s Stan McElroy, who is representing Fidelity Investments in its lease, said he is also working for two other shops interested in space. International Coffee & Tea LLC wants to open a Coffee Bean & Tea Leaf caf & #233; and PF Chang’s China Bistro Inc. plans to open its fast casual concept Pei Wei Asian Diner.
McElroy wouldn’t comment on terms of the deals because all three clients’ leases are still in negotiations.
Craig DeMiranda of Trammell Crow’s Irvine office represented Comerica on the lease. DeMiranda referred requests for comment to Comerica. Trammell Crow’s Brad Cox represented the landlord.
Pressure Point
With Burbank’s office market quickly filling up, one beneficiary is likely to be 4000 W. Alameda Ave., according to brokers.
The building is one of a few Burbank offices with large blocks of available space. The other, 2600 W. Olive St., is listed for sale by its owner, CARR America Realty Corp.
Until the Olive Street building, which is nearly 60 percent vacant, finds a buyer, some brokers believe it won’t be aggressively leasing space. For that reason, all eyes are on the 120,000-square-foot Alameda Avenue building at the intersection with Pass Avenue.
“I expect to see a lot of announcements coming out of there in the next couple of months,” said Paul W. Stockwell, a corporate managing director at Studley. “It’s one of the few buildings left with 20,000-square-foot floors available.”
Already, DreamWorks SKG inked a five-year deal worth $6 million for 35,000 square feet in 4000 W. Alameda. DreamWorks has occupied the space and is using it for back-office purposes.
The DreamWorks deal was another win for the Burbank market, where average office buildings were 11.1 percent vacant at the end of June a sharp decline from the 14.8 percent average vacancy from the same year-ago period, according to Grubb & Ellis.
Asking rents in Burbank have been on the rise during the past year and average $2.65 a foot.
Alameda Enterprise Inc., a firm led by an overseas investor, owns the 22-year-old building at 4000 W. Alameda Ave. It was once occupied entirely by Time Warner Inc. subsidiaries.
Alameda Enterprise is represented by CB Richard Ellis’ Doug Marlow, who didn’t return calls.
Matthew Miller, a principal at CRESA Partners, represented DreamWorks on its lease. Miller declined to comment.
Foreclosure Spike
The number of new foreclosures in Los Angeles County spiked 41 percent last month, further stoking housing-bubble concerns.
More than 1,000 properties last month entered foreclosure, an increase of 315 since May, according to RealtyTrac Inc., which tracks foreclosure rates nationally.
Despite the increase, L.A. County’s foreclosure rate one for every 3,012 households is far below the national average and the lowest in the nation’s five largest metropolitan areas. (The others are New York, Chicago, Philadelphia and Dallas.)
“This is the first significant increase in Los Angeles foreclosure rates that we’ve seen in the past six months,” said RealtyTrac Chief Executive James J. Saccacio. “Whether this is the beginning of a trend or a one-month spike is something we’ll be following closely.”
California foreclosures rose 19 percent last month, with the state accounting for 6.6 percent of foreclosures nationwide. But for one foreclosure for every 2,773 households, California’s default rate remained less than two-thirds the national average.
“In spite of the increases in both the state and Los Angeles, both remain significantly under the national foreclosure-rate averages,” Saccacio said.
Foreclosure rates in Riverside and San Bernardino counties jumped 14 percent and 11 percent, respectively. There, foreclosure rates continue to hover above state and national averages.
While Orange County still has one of the lowest foreclosure rates one for every 4,143 households for a county its size across the country, the number of June foreclosures jumped 23 percent from May.
Nationwide, the number of properties entering foreclosure last month rose to 67,024 from 62,432 in May. Texas, Florida, California, Ohio and Illinois had the most new foreclosures and accounted for more than half the nation’s total with 37,249.
The overall increase was the highest number of new foreclosures reported in any one month this year and resulted in a 7.4 percent increase in the nation’s default rate. Nationally, one new foreclosure was filed for every 1,726 households.
Still, Saccacio said the rise isn’t necessarily “cause for alarm, but it’s certainly an indication that foreclosures bear watching.”
*Staff reporter Andy Fixmer can be reached by phone at (323) 549-5225, ext. 263, or by e-mail at
[email protected]
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