deals & dealmakers
A look at the transactions making the biggest impact on the commercial real estate landscape
development
JV COMPLETES 21-BUILDING,
$45M INDUSTRIAL COMPLEX
Hawthorne, CA—MS Kearny Northrop
Avenue LLC, a joint venture of Kearny Real
Estate Co. and Morgan Stanley Real Estate
Fund V, has finished work on a 21-building
industrial complex here. The $45-million development consists of more than 203,000 sf that
can either be leased or purchased by users.
“This type of development is unique in
Los Angeles County, specifically in the
South Bay,” says Hoonie Kang, a partner at
Los Angeles-based Kearny Real Estate Co.
“It’s such an infill market that there aren’t
many new development opportunities. Plus,
we really don’t have much competition for
this product type, although we’ve seen the
demand for it increasing.”
The developers, notes Kang, were also
motivated by the central location of the
property, which is situated near the intersection of Interstates 405 and 105. “We just
thought we were in the heart of where the
demand would be. The facilities make
sense for small users that want to own their
own buildings close to the freeways.”
The buildings range in size from 5,700 to
20,700 sf with 24-foot clear heights. They
feature full sprinkler systems, ground-level
loading and office build-outs of up to 2,000
sf. Fischer Corporate Real Estate Services
is charged with marketing the properties.
UK-based food company Kavli has
signed a three-year lease with the option to
purchase an 8,115-sf building, according to
Jeff Kernochan of Fischer. An undisclosed
buyer is closing on another property, while
lease and sales contracts for six other buildings are in negotiations.
The development is located within Century
Business Center, a 2.6-million-sf office and
industrial complex that the JV purchased
from Vought Aircraft Industries for $61 million
in July 2005. The aviation company consolidated its operations on the 86-acre site to 41
acres on which it now leases 1. 4 million sf in
12 buildings for the manufacturing of Boeing
747 fuselages and 767 aft body panels.
Century Business Center
Kearney has sold or leased the remaining
776,000 sf in 15 buildings to such users as
SpaceX, Hanger Athletic Exchange and
LaLicious.—Danielle Douglas
Leasing
Development: Did You Know?
Deloitte LLP is gearing up for the construction of a $300-million learning and leadership development center in
Westlake, TX. The 750,000-sf campus will feature multiple conference facilities, classrooms, a business center, dining
venues and 800 guest rooms for employees. Work on the project, which is being built to LEED standards, is slated to
begin in 2009, with an anticipated opening in 2011…Ground broke last month on West Quest C, a 160,000-sf office
building in Linthicum Heights, MD. Opus East LLC is developing the five-story structure to achieve LEED certification.
Situated on 9. 5 acres within the West Quest Technology Park, the building will be fully occupied by Northrop Grumman
under a 10-year lease…Phase I of Regency Centers’ redevelopment of Brea Marketplace, a 351,928-sf shopping
center in Brea, CA, has been completed. The second phase of the project will feature a TGI Friday’s and an adjacent
4,000-sf, two-story office building, scheduled to open in 2009…Home furnishings retailer IKEA is anticipating a mid-September delivery for its Tacoma Distribution Center in Tacoma, WA. The 834,000-sf facility is being built on 65 acres
in the Frederickson Industrial Area and can be expanded to more than one million sf. The center will provide primary
inventory to four stores in Western Canada and three in the US…A 300-unit luxury apartment complex is on the rise
in Sparks, NV. Designed by Biltform Architecture Group, the asset will be part of Fore Property Co.’s new brand line,
Four Communities. Located within the Pioneer
Meadows master-planned community, the two-story
garden-style buildings will be ready for occupancy in
June 2009…Starwood Hotels & Resorts Worldwide
Inc. has opened the 135-key Sheraton Columbia
Downtown Hotel in the historic Palmetto Building in
Columbia, SC. The asset is owned and managed by
London 1 LLC…Carr Properties has broken ground
on 1701 Duke at Edmonson Plaza, a five-story,
115,000-sf office building in Old Town Alexandria, VA.
West Quest C The class A asset is set for delivery in January 2010.
HSBC CONSOLIDATION PLAN
WRAPS UP WITH BTS DEAL
Itasca, IL—A consolidation effort that
began four years ago has come to a close
with the signing of a 15-year lease by HSBC
North America. Construction on a 304,000-sf
build-to-suit facility, located in this Chicago
suburb, is set to begin this fall.
The deal is the second and final phase of
the bank’s plan to move nine locations in
the Chicago area into two more efficient
and cost-effective facilities, relates Dan
McCarthy, the Jones Lang LaSalle senior
vice president who assisted HSBC in the
site search and deal negotiations, along
with JLL’s Elaine Melonides. The first phase
involved a 13-year, 550,000-sf lease signed
in 2006 for a North American headquarters
in Mettawa, IL. Some 3,500 employees
moved into that building, developed by
Hamilton Partners, earlier this year.
Chicago-based Hamilton Partners is also
building the Itasca facility, located within the
Hamilton Lakes business park. According
to McCarthy, the tenant considered more
than 30 locations in its site search. “The
most important thing for HSBC was the
proximity to its existing employee base,” he
says. “The team really focused on sites that
would minimize attrition and allow them to
retain their current employees.” That both
deals were signed with Hamilton Partners,
he adds, is a coincidence.
