The former Spruce Goose hangar in Playa Vista is available for interested parties, along with the opportunity to claim Google Inc. as a tenant just as the technology giant is planning to expand its office space within the massive wooden shell.
According to marketing materials compiled by brokerage HFF, Google plans to build three floors of offices and a mezzanine in the Howard Hughes-designed space, aiming to “pay homage to the history of Hughes’ legacy while incorporating cutting-edge design.” That would increase the size from 251,700 to 418,600 square feet of office space.
HFF’s John Crump said the property went on the market at the end of August but would not disclose the asking price. The site’s value could be difficult to estimate: Despite the obvious appeal of owning a Google-occupied office property, the hangar is really just a raw shell made of layers of glued wood.
Recent Playa Vista office sales have nabbed between $740 and $840 a square foot, and sources familiar with the market estimate the Spruce Goose site could notch as high as $900 to $1,000 a square foot due to its blue-chip tenant.
That suggests the hangar, along with several small buildings with which it shares the 358,000-square-foot Hercules Campus West, could potentially be worth as much as $358 million.
The cathedral-like structure contains two sections measuring 750 feet by 100 feet under a roof peaking at 72 feet – large enough for Hughes to build the Spruce Goose, a 200-ton wooden cargo plane also known as “Hercules,” in the mid-1940s.
Google’s lease, signed last year with property co-owners Ratkovich Co. and Penwood Real Estate Investment Management, is good for 16 years with three five-year options to renew. Google nabbed a low monthly rent of $2.50 a square foot because it will need to spend heavily on renovations. ZGF Architects and contractor Matt Construction Corp. have been contracted for the project, which has secured several preliminary construction permits.
Ratkovich acquired the hangar in 2010 when it bought 28 acres of surrounding properties for $34.2 million.
Google purchased an adjacent 12-acre property for $120 million, making a strong Playa Vista commitment.
Google has an option to buy the hangar at the end of its lease, but the opportunity to buy now might prompt faster action.
Google did not respond to a request for comment nor did representatives at Ratkovich.
Tower Times
Tribune Media is aiming to build a 30-story condominium tower next to the Los Angeles Times building downtown, according to an entitlement application filed last week with the city’s Planning Department.
The project would replace a surface parking lot while retaining a five-story parking structure next to a forthcoming light-rail station at Broadway and Second Street.
Plans call for a mixed-use building of 107 condos, 534,044 square feet of office space, and 7,200 square feet of ground-floor commercial space.
Tribune held on to the parcel when it sold the neighboring Times building last week for $105 million to developer Onni Group. Onni is planning to build apartments in place of a 1970s-era chunk of the building, if it is able to secure entitlements.
Tribune’s project, however, is distinct. Tribune spokesman Gary Weitman confirmed that the company filed the application but wouldn’t elaborate on the company’s plans.
Industrial Increase
Five new industrial buildings totaling 501,270 square feet just hit the market in El Monte, giving the San Gabriel Valley city its first new industrial sites in about eight years. Developer Magellan Group sold three of the just-completed properties and is marketing the remaining pair to both buyers and sellers, said co-founder Kevin Staley.
“There hadn’t been any large-scale development in this market for many, many years,” he said.
The San Gabriel Valley vacancy rate plummeted to 0.7 percent in the third quarter, according to Jones Lang LaSalle.
Staley said the site was once occupied by manufacturing companies including a fire hydrant maker and boiler maker, but a previous owner had cleared the land. When designing the buildings, he planned to target medium-size companies and Chinese buyers, and even incorporated feng shui design principles.
Staff reporter Daina Beth Solomon can be reached at [email protected] or (323) 549-5225, ext. 237.
