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Equity Office Daily Brief: June 1, 2016

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Daily Brief

June 01, 2016

  EquilityOffice

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How International Issues Affect Foreign Investment in U.S. Real Estate

U.S. News & World Report

 

There's no doubt that international buyers love U.S. real estate. In 2015, 15.4 percent of all commercial real estate buyers in the U.S. were from overseas, according to financial and professional services firm Jones Lang LaSalle. On the residential side, the National...

 


Leases for 320 Sports Authority stores to go to auction

Chain Store Age

 

Sports Authority’s remaining 320 store leases will be auctioned in June.   The leases will be sold by commercial real estate, advisory and investment group A&G Realty Partners, which is currently accepting bids on the leases. The leases are for stores that range...

 


Developer looks to revamp infamous Cecil Hotel in downtown Los Angeles

Los Angeles Times

 

The Cecil Hotel in downtown Los Angeles is set to undergo a $100-million renovation by a New York City developer, which aims to transform the former den of prostitution and drugs into a hip boutique hotel and micro rental units. The plan for...

 


Medical Magnet

San Fernando Valley Business Journal

 

Tarzana’s new Ventana Medical Center on Ventura Boulevard hasn’t opened yet but it’s already opening doors – one to a cutting-edge, one-stop-shop for cancer treatment and the other to the West Valley market for out-of-area health care providers.   When completed later this...

 


Real Estate Firm Expands Here, Buys First Property

San Fernando Valley Business Journal

 

An East Coast investment company closed on a North Hollywood industrial building in its first investment as a principal in Southern California. Penwood Real Estate Investment Management in Hartford, Conn. bought a 48,204- square-foot building on 2.35 acres at 12222 Sherman Way...

 


Honda Dealership Planning Move to Expo Park

LA Downtown News

 

DTLA - The Honda of Downtown Los Angeles dealership on the Figueroa Corridor is moving — or, more accurately, expanding. The company has long been located at 1540 S. Figueroa St., by the 10 Freeway overpass.Now it has plans to build a...

 



BLOG & ONLINE NEWS

 

How Do Buyers React to Rising's Built-In Internet?

GlobeSt.com

 

Rising Realty Partners’ sister telecommunications company 5×5 Telecom is making major waves in the office sector. The company launched the telecommunications company at PacMutual as a reliable and affordable Internet and phone service, and it resulted in tremendous occupancy and rent...

 


IgnitedSpaces Leases 42k sf in LA's Fashion District

RENTV.com

 

IgnitedSpaces has inked a lease for 42.2k sf of space at California Market Center in the Los Angeles Fashion District. Hollywood-based IgnitedSpaces provides flexible, state-of-the-art work and studio spaces with a full array of business support services. Under the terms of the...

 


Summing Up Healthcare Real Estate Trends

Bisnow

 

Cost reductions, the consolidation of health networks, the need for capital and increases in construction were among the topics touched upon in the "Lightning Round" of Bisnow's recent LA Annual Healthcare Expansion Forum. Newmark Grubb Knight Frank executive managing director of global...

 

FULL TEXT


How International Issues Affect Foreign Investment in U.S. Real Estate

U.S. News & World Report

 

There's no doubt that international buyers love U.S. real estate. In 2015, 15.4 percent of all commercial real estate buyers in the U.S. were from overseas, according to financial and professional services firm Jones Lang LaSalle.

On the residential side, the National Association of Realtors reports international buyers purchased 4 percent of existing homes sold in the U.S. in 2015, which made up 8 percent of the total dollar amount of existing homes sales for the year at $104 billion. The biggest foreign residential buyers in 2015 were from China ($28.6 billion), Canada ($11.2 billion), India ($7.9 billion), Mexico ($4.9 billion) and the U.K. ($3.8 billion), according to a study examining Chinese real estate investment conducted by the nonprofit Asia Society and real estate economics firm Rosen Consulting Group.

Foreign investors have long viewed U.S. real estate as a good place to diversify their portfolio and benefit from the world’s strongest economy. But in recent years, hard assets in the form of U.S. property has also become an option to safely store money. “We’ve become what is today, I guess, the largest offshore location in the world,” says Ed Mermelstein, an international real estate attorney based in New York.

But what happens to an investor's interest in U.S. real estate when international events affect his or her home country and lead to uncertainty over the future?

From economic meltdowns abroad to terrorism to squabbles over European Union membership, the growing international role in major U.S. real estate markets means we’re more likely to see the impact of those issues, says Ross Milroy, owner and broker at Ross Milroy Realty in Miami.

“The Miami real estate market – and I think New York is very similar as well – we’re so dependent on the international buyers, and they’re such a huge part of our market," Milroy says. "A lot of our real estate markets do not follow traditional patterns, and a lot of our demand is dependent on what’s going on in those home countries of our buyers.”

Here are some of the most prevalent international issues affecting domestic real estate today.

Economic Woes

What better place to seek financial stability than the largest economy in the world? For a well-off individual in a country facing economic meltdown, moving your money to a more stable economy can seem like a no-brainer – and that’s just what people are doing.

“They all understand that diversifying in international real estate over a period of time is proven to show greater return on your investment in your real estate portfolio than if you put all your investments in, let’s say, the Mexican peso,” Milroy says.

When the NAR surveyed its members in 2015, it found 75 percent of them believe changes in the value of the U.S. dollar influence possible purchases of U.S. real estate by international clients.

A stronger dollar, when compared to other currencies, makes it more expensive for foreign buyers to purchase U.S. real estate. When a country such as China or Venezuela experiences significant depreciation of its currency, suddenly it becomes difficult for them to buy American property.

But, if anything, economic trouble encourages a country's wealthiest citizens to invest in assets abroad when that option is feasible.

In an effort to reduce China’s economic slowdown after multiple stock market crashes in the summer of 2015, the worst of which occurred that August, the Chinese government issued currency restrictions, including a law forbidding citizens from transferring more than $50,000 out of the country annually. As a result, Chinese investors interested in buying real estate abroad are unable to move their cash out of the country, and Mermelstein notes the last six months have particularly seen a change in U.S. residential property purchases with a decrease in Chinese investment.

Politics

Playing a major part in international economies, political disputes between countries and even political unrest within a nation can have a ripple effect on overseas buyers acquiring properties in the U.S. These political situations can either make it more difficult for buyers to move wealth abroad or cause buyers to purchase a greater number of overseas properties, showing that they have more faith in another country's political and economic climate.

“There have been quite significant disruptions in international economic positions, whether they’ve been influenced by politics or in a significant way by the drop in oil prices. And each one has affected different regions in a different way,” Mermelstein says.

In 2014, the U.S. issued sanctions against Russia for its aggressive actions toward Ukraine, and while those financial sanctions don’t directly address real estate, Mermelstein says they affect many Russians’ ability to invest in the U.S. market because the political atmosphere, combined with the drop in oil prices, has caused the Russian ruble to suffer significantly.

Harmel Rayat, a Canada-based real estate investor and author of “Winning With Commercial Real Estate,” says he sees some international investors entering the U.S. market not for financial gain through return on investment but instead as a way to move money out of a country they may not politically benefit from anymore.

“A lot of that money isn’t necessarily coming for yield. That money is coming for other reasons – political reasons. They just want to protect their assets, get the cash out of their local countries,” Rayat says.

Violence

The insecurities don’t stop at economic and political fears. The threat of terror attacks in Europe and elsewhere are driving individuals to try to find a safe place for their assets in the U.S.

Milroy notes the recent bombings in Brussels and multiple terrorist attacks in Paris in the last year have led many European investors to seek stability for their investments, and possibly a place for them to stay, in the United States.

“All this terrorism has terribly affected a lot of people. I personally have seen more Germans, Austrians, French people and Italians in the last year than I have seen in 10 years,” Milroy says.

What Does It Mean for the U.S. Market?

With so much of the world interested in holding a stake in the U.S. real estate market, any global issue has the potential to affect who enters or exits the market.

As an international investor with multiple U.S. properties in his portfolio, Rayat notes that some foreign buyers don’t always make decisions based only on expected returns, but rather they’re “using high-quality real estate as a Swiss bank account” to assure themselves safety and security.

As a result, this kind of international investment can artificially boost the U.S. real estate market, with investors more focused on gaining a foothold in the market than following property values or potential worth. “They’re paying up for properties that in some ways don’t make any economic sense – certainly not to me,” Rayat says.

The lone constant? China.

Despite the Chinese government’s moves to keep wealth inside the country, Chinese buyers made up the largest share of international purchases of residential real estate in 2015, totaling $28.6 billion, according to the study by Asia Society and Rosen Consulting Group.

Mermelstein notes that the China's economic problems may cause Chinese investors to slow their purchases for a while, but they will remain a big player among foreign buyers going forward: “We do expect that, long term, China is going to play a significant part in any serious investment coming from Asia in the United States.”

-Devon Thornsby

Leases for 320 Sports Authority stores to go to auction

Chain Store Age

 

Sports Authority’s remaining 320 store leases will be auctioned in June.

The leases will be sold by commercial real estate, advisory and investment group A&G Realty Partners, which is currently accepting bids on the leases. The leases are for stores that range from 10,000 sq. ft. to 80,000 sq. ft., and are located in many of the major retail markets in the country including prestigious locations in New York City, Chicago, Los Angeles, Dallas, and Miami. (Click here for full store list.)

“The company has done a great job with its real estate and their locations are well positioned in key retail street and power center locations. By taking assignment of leases, retailers have the opportunity to enter new markets and gain access to projects they may have previously been unable to penetrate,” said Emilio Amendola, A&G co-president.

Store closing sales are expected to carry on through August but bids for the leases are due June 23, with an auction set for June 29th in Wilmington, Delaware.

“Interested parties should move quickly on submitting offers for leases before the bid deadline,” said Amendola.

-Marianne Wilson

Developer looks to revamp infamous Cecil Hotel in downtown Los Angeles

Los Angeles Times

 

The Cecil Hotel in downtown Los Angeles is set to undergo a $100-million renovation by a New York City developer, which aims to transform the former den of prostitution and drugs into a hip boutique hotel and micro rental units.

The plan for the hotel is yet another example of the development boom sweeping downtown, where old buildings are being revamped and new hotel and condo towers erected.

“We are gutting the entire building,” said Matthew M. Baron, president of Simon Baron Development, which this month signed a 99-year ground lease with the building’s owner, 248 Haynes Hotel Associates. “We are going to redevelop it from the doorway to the roof and everything in between.”

But the transformation of the hotel – which served as an inspiration for a season of “American Horror Story” – could prove controversial.

The Cecil, a 600-room tourist and residential hotel, has been the subject of litigation in recent years as housing advocates looked to preserve cheap residential hotel units in an increasingly gentrifying downtown.

An effort was also launched to turn most of the building into housing for the homeless, though the plan collapsed amid opposition from downtown business leaders.

Today, the 1920s building is home to Stay on Main, a 299-room low-budget tourist hotel, where travelers can grab a private room with a shared bathroom for $75 a night

The building’s remaining 301 rooms are small residential hotel units subject to preservation under a city ordinance and court settlements.

Only about 30 are occupied, and tenants will be eligible for temporary or permanent relocation benefits, according to Barbara Schultz, an attorney for the Legal Aid Foundation of Los Angeles.

Baron said the company isn’t planning to convert units into full-fledged apartments. But depending on how expansive the renovations are to residential units, the developer could be forced to add affordable units within the property or nearby, said Schultz, who was involved in the court settlements.

Baron said his company plans to abide by any such requirements and called the company’s transformation of the largely vacant building “wholly good” for the neighborhood.

While an exact mix count isn’t final, Simon Baron plans to have more residential units than tourist hotel rooms.

For tourists, Baron said he aims to create a hotel on par with other boutiques downtown, including the popular Ace Hotel a few blocks away, where a standard room starts at $199 a night.

In addition to extensive room renovations, Simon Baron plans to add a rooftop pool, fitness club and lounge – amenities available to both residents and hotel guests.

Construction is set to begin in spring 2017, with work wrapping up about two years later.

“We really think it’s a fantastic location – the center where everything is happening,” Baron said. 

Rick Cocoa, a spokesman for Councilman Jose Huizar, who represents downtown, said plans have yet to be filed with the city. Once they are, he said, any necessary approvals will be identified.

A new Cecil would join a plethora of recent renovations in an area once widely considered part of skid row.

In late 2014, a revamped Regent Theater opened up on Main Street, and a luxury apartment complex is underway a few blocks over at the former location of the Union Rescue Mission.

Other boutique hotels are also coming nearby, including two set to open near the Ace, located off Broadway and 9th Street.

Alan Reay, president of Atlas Hospitality Group, described downtown Los Angeles as “probably the hottest hotel market in the United States.” If the area’s revival continues unabated, the market should absorb the flood of upcoming units, he said.  But that’s not a sure thing.

“The big question would be: How deep is the market?” Reay said.

Simon Baron is betting there’s plenty of growth left. 

For its residential portion, the company brought on co-living firm Stage 3 Properties, of which it is an investor, to offer fully furnished micro-units with a heavy dose of shared experiences.

A live-in community manager, for example, will organize events that could include travel opportunities, guest lecturers and rooftop group meals prepared by local, up-and-coming chefs.

Chris Bledsoe, co-founder of Stage 3’s co-living brand Ollie, said that young adults in particular are willing to shed living space for such amenities in an urban environment at a relatively low cost.

The units – from about 150 square feet to 325 square feet — will come with beds that fold into sofas and restrooms, though they won’t have kitchens.

“It allows a 200-square-foot space to function like a 400-square-foot space,” Bledsoe said.

The small units allow rents lower than the typical urban studio, Bledsoe said, though he acknowledged they would be higher than the residential units there now.

Based on the current market, Ollie’s rents – which include Wi-Fi, cable and housekeeping services — would be under $1,500 a month, he said.

A search Tuesday of real estate website Zillow.com found only four downtown units below $1,500.

While the rooms will lack kitchens, Bledsoe said his company is looking to add some sort of food-preparation option in the units, though burners will not be available – a result of restrictions aimed at preserving the rooms as residential hotel units.

A revamp of the Cecil would be a dramatic turn for a hotel that, while a destination for the rich and famous in the 1930s and 1940s, became a haven for drugs and prostitution in the following decades as downtown fell on hard times.

Serial killers Jack Unterweger and Richard “Night Stalker” Ramirez also occasionally stayed there.

By 2008, the Cecil was involved in a renovation effort and the LAPD said calls had dropped dramatically.

LAPD Sgt. Michael Flanagan said Tuesday that he couldn’t even recall a recent report of prostitution.

“It’s definitely gotten a lot better,” he said. “We have minor issues like disputes, but nothing like it used to be.”

Still, in 2013, the body of a Canadian tourist was found in one of the large metal water cisterns on the roof – a case that reportedly provided inspiration for “Hotel,” a season of “American Horror Story.”

Baron said he doubted that gruesome history would deter people from a newly upscale Cecil.

 

“Quite frankly,” he said, “a lot of people already come there out of curiosity.”

-Andrew Khouri

Medical Magnet

San Fernando Valley Business Journal

 

Tarzana’s new Ventana Medical Center on Ventura Boulevard hasn’t opened yet but it’s already opening doors – one to a cutting-edge, one-stop-shop for cancer treatment and the other to the West Valley market for out-of-area health care providers.

 

When completed later this year, the four-story facility on the Tarzana-Encino border will become the Integrated Cancer Institute, with about half its space occupied by L.A.-based national diagnostic imaging services provider RadNet Inc. and its partnering medical provider groups.

 

The 112,000-square-foot hospital-like facility will treat all aspects of cancer, aiming to give locals an alternative to driving into the Los Angeles basin. It will be RadNet’s newest and biggest office and will serve more than 4,000 patients daily.

 

The modern, glass-accented structure sits on 2.4 acres at the northwest corner of the boulevard and Lindley Avenue, about a block and a half from the Providence Tarzana Medical Center, which is planning its own $624 million expansion. Real estate brokers in the medical office space say the new facility will likely get the $3.85 a square foot asking rent because of the prime location, and they expect the two projects will lure more L.A.-based health care providers to that part of the Valley. Average asking rents for office space in the west Valley were $2.26 a foot in the first quarter.

 

Daniel Kashani, chief executive of the center’s developer, Pacoima’s TriStar Realty Group, took on the $52 million project, a figure that includes land and construction, because it represents the future of real estate for hospitals and health care.

 

“What we’ve seen happening is that delivery of health care has gone from the traditional method of hospitals running hospitals, to having different points of health care through communities – off-campus clinics feeding business to hospitals,” Kashani said. Procedures that used to exclusively happen in the hospital are now being done as outpatient procedures on satellite campuses – such as the Ventana Center, he added. “That was the need we were initially trying to fill.”

 

Merging directions

 

TriStar and Kashani were developing general office and small strip malls when they saw the potential of the satellite campus trend with a project to build a large dialysis center on property they owned across from a hospital in Pomona. Also, smaller doctors’ groups, faced with increasing costs to run a health care business, were consolidating into bigger ones, and Kashani figured these would need larger medical office space that was lacking in the Valley.

 

That led TriStar to buy the Ventana center parcel in 2008, which had a small retail store on the substantial property.

“It made sense for lots of reasons,” Kashani said. “The site was mostly undeveloped – it had a 20,000-square-foot building on 2.4 acres. It was underutilized. The Ventura-Cahuenga Boulevard Corridor Specific Plan allows in that portion of the boulevard a 105,000-square-foot building, but it had only 20,000 square feet on it.”

Most importantly, the site was only a block and a half from Providence Tarzana Medical Center. Kashani and CBRE Group Inc. medical office broker John La Spada met with the hospital after tossing over a few other possible uses for the site, including a Target store.

“What was the most telling was that the hospital had an HMO (health maintenance organization) plan for employees, and business development told us they had to go to West Hills because they can’t provide them with an HMO facility next to the hospital,” he said. “Then the light bulb went off.”

La Spada provided the connection to RadNet, a long-time client. Through 300-plus diagnostic imaging centers on the West and East Coasts, RadNet partners with hospitals for its services and forms relationships with insurers, radiology groups, referring physicians and other businesses to operate at its centers. About 140 of its centers are in California.

“RadNet is a go-getter type of group,” La Spada said. “They had an interest to be in this market. Tristar gave RadNet a lot of influence in the project to help them create their own punch list of folks to work with and create their own model.”

RadNet and its partnering doctors’ groups are leasing about 50 percent of the building. Other tenants include Facey Medical Group, an affiliate of Providence Health & Services, the Catholic organization that owns Providence Tarzana. The hospital organization will also operate a surgery center on the site. The building is about 80 percent leased, TriStar said.

RadNet’s lease agreement helped TriStar get its construction loan, La Spada said, as lenders now want at least 50 percent pre-leased before building starts.

“The key is we had a majority of the building leased before we broke ground and having (a building with) large blocks of space were instrumental to leasing out that space quickly,” Kashani said.

One-stop shop

The Integrated Cancer Center will be the largest cancer center in the Valley, according to RadNet, and a one-stop shop for cancer treatment.

It will include an MRI facility (magnetic resonance imaging), another for PET/CT scans (positron emission tomography/computed tomography), an 8,000-square-foot linear accelerator for radiation-based cancer treatment, RadNet’s Breastlink breast health center and reconstructive plastic surgery group, a medical oncology practice doctors’ group managed by RadNet, an orthopedic and pediatric practice and a 12,500-square-foot surgery center.

Norman Hames, chief operating officer of RadNet, said the facility’s main attractions to the company are its size and location along Ventura Boulevard. RadNet’s other imaging and Breastlink centers are smaller and bulging at the seams, he said.

“This will be an easy access point for people anywhere in the Valley,” Hames said. “It will also provide full services – oncology, cancer surgeons, imaging, laboratory for lab work, pathology and a pharmacy. They can basically have a one-stop shop and it will be community-based.”

RadNet is also able to provide patients a hospital stay through its partnership with Providence Tarzana.

“Everything is being driven by efficiency of cost, quality of care and the outcome that that provides,” Hames said.

In addition to the cancer center, Providence Tarzana Medical Center announced a $624 million expansion that will include a new patient wing with 190 beds, as well as and a diagnostic practice and an emergency department and a pediatric intensive care unit. The hospital expects construction will finish in 2022.

Tough road

Despite the market need and community appeal, getting the center approved by city officials and Tarzana’s neighborhood council was a three-year process.

The facility required 17 exceptions to the Ventura Boulevard’s plan, Kashani said. The toughest hurdle was that TriStar’s building was 62 feet tall but the plan capped new building heights at 36 feet. The city allowed it in the end, he said, because TriStar and its consultants were able to show that the medical building was much-needed and required extra ceiling height to operate most efficiently.

But TriStar didn’t get everything it wanted, either. It had to reduce the building’s size by 20,000 square feet and include a retail element. That will be a pharmacy that sells medical supplies and a restaurant, Kashani said.

When operational, the center will offer some niceties – a no-charge valet service, 605 parking spaces, a car wash and a cheerful mural painted by Valley artist Sage Vaughn on an exterior wall that drivers on the boulevard can see while passing by.

Construction of medical office space has been constrained in the Valley for at least 10 years because of high parking requirements by the city that were expensive to achieve and increasing construction costs, said Jeremy Barbakow, a senior vice president with brokerage NAI Capital Inc. in Encino.

He suspects the medical center, brand new and close to the hospital, will likely get the $3.85 asking rent. And that high price, Barbakow said, is opening a window for nearby landlords to get into the more lucrative medical office market by offering cheaper rates.

As an example, he said clients of his that recently bought a general office building older and farther from the hospital are in the process of changing the building’s use to medical so they can raise rent to nearly $3 a square foot. That’s a lot higher than their current rate of $2.35 a square foot but still less than the Ventana’s asking rent, Barbakow said.

Other developers are also getting into the medical market, he said, citing a proposed building in the planning stages across the street from the hospital at Etiwanda Avenue and Clark Street. The new projects will likely attract more L.A.-based providers, he added.

“All this new construction – the expansion of the hospital and other projects makes Tarzana the hub it wants to be and attract more doctors and large medical groups, such as UCLA, to the market because that’s where they want to be,” Barbakow said.

-CaroL Lawrence

Real Estate Firm Expands Here, Buys First Property

San Fernando Valley Business Journal

 

An East Coast investment company closed on a North Hollywood industrial building in its first investment as a principal in Southern California.

Penwood Real Estate Investment Management in Hartford, Conn. bought a 48,204- square-foot building on 2.35 acres at 12222 Sherman Way in North Hollywood from the trust of Ronald E. Snow in Palm Desert, according to commercial real estate firm Colliers International in Encino. The price was $7.25 million, according to real estate database firm CoStar Realty Information Inc. The trust bought the property in 2006 for $5.8 million, according to CoStar.

Colliers is also handling leasing, with asking rates of 92 cents a square foot for a triple-net lease, or one in which tenants pay their portion of property taxes, insurance and common area maintenance.

The property is Penwood’s first acquisition in Southern California as a principal in a deal. It recently opened a Los Angeles office in order to expand here. The company’s prior experience in Southern California has been as a partner providing capital for deals, according to Colliers.

Penwood is renovating the building, which was built in 1976, by putting on a new roof, upgrading the parking lot and making other improvements. The property sits adjacent to the 170 Freeway.

Colliers Senior Executive Vice President John DeGrinis, Senior Vice President Patrick DuRoss and Vice President Jeff Abraham represented both parties on the deal.

-carol Lawrence

Honda Dealership Planning Move to Expo Park

LA Downtown News

 

DTLA - The Honda of Downtown Los Angeles dealership on the Figueroa Corridor is moving — or, more accurately, expanding. The company has long been located at 1540 S. Figueroa St., by the 10 Freeway overpass.Now it has plans to build a new dealership at the intersection of Martin Luther King Jr. Boulevard and Hoover Street near Exposition Park, according to a recent filing with the Department of City Planning. According to the documents, Honda would demolish an existing two-story building and raise a pair of five-story structures, one on each side of Hoover Street, to house showrooms, service facilities and vehicle storage areas. The new dealership, slated for completion in 2021, would effectively be the new headquarters of Honda of Downtown, though the property on Figueroa Street would still operate as a dealership for used cars and performance vehicles, according to a report from the real-estate website Urbanize.la.

-Staff

How Do Buyers React to Rising's Built-In Internet?

GlobeSt.com

 

Rising Realty Partners’ sister telecommunications company 5×5 Telecom is making major waves in the office sector. The company launched the telecommunications company at PacMutual as a reliable and affordable Internet and phone service, and it resulted in tremendous occupancy and rent growth. Now, the firm is launching the service at all of its properties and other property owners are signing up, too. But, is there problem when an investor and property owner operates the Internet service at a competitor’s building? We asked Marc Gittleman, the CEO of 5×5 Telecom, about buyers’ response to the Internet service during the incredible sale of PacMutual and how buyers and sellers are responding now.

“It was a huge part of the 100 tours that we did when we were selling PacMutual,” Marc Gittleman, the CEO of 5×5 Telecom, tells GlobeSt.com. “It did breed a lot of questions, like who owns that company; what happens when we sell the property; are you going to continue the quality of service? Those were all questions that all of the serious buyers had, and the answers were very simple. The telecom business is a for-profit venture. We would be foolish to turn off that revenue stream, because it is not an insignificant revenue stream and we wouldn’t be perusing it if it were. We want the new owners to understand what we did and be happy that they have a place to send new tenants leasing space. That is a transition that we worked on through training and educating, and taking something that is an unknown and making it a benefit or another asset to the building.”

The decision wasn’t necessarily a choice for buyers to take or leave. The completely separate company has the same rights of entry that any other telecommunications company has. “We have rights of entry that extend anywhere from 20 to 30 years, so it doesn’t matter what any other owners wants because our agreements supersede any other transaction, other than condemnation of the building,” adds Gittleman.

For that reason, buyers aren’t able to take over the operations of the built-in fiber optic system or service tenants, which helps protect the company. And, if buyers did want to start a similar company, Gittleman, who has a tech background, says that would be challenging for another owner. “We started out knowing that we would want to do this at scale, and you have to have the wherewithal and the desire to do it at scale,” he explains. “It is not something that you can kind-of be in the business of, because you will be in the position that AT&T was when we bought this building, which is that everyone is complaining that it is not working. I make it sound like it is very simple to do, but you have to have the mind frame and skillset to be able to do it.”

Now, Rising is having the opposite conversation when acquiring new office projects. “Every new project that we do will have 5×5 in it,” says Gittleman. “When we acquire a project we sit down with our partners, and we explain how the company works and how it drives rent and absorption. After the sale of PacMutual, that was a really easy conversation.”

-Kelsi Masee Borland

IgnitedSpaces Leases 42k sf in LA's Fashion District

RENTV.com

 

IgnitedSpaces has inked a lease for 42.2k sf of space at California Market Center in the Los Angeles Fashion District. Hollywood-based IgnitedSpaces provides flexible, state-of-the-art work and studio spaces with a full array of business support services.

Under the terms of the new lease, IgnitedSpaces will occupy the entire 12th floor of the Center’s Building B. The building is one of three, 13-story interconnected structures comprising the 1.8 msf urban campus, located at 110 E. 9th Street.

The space boasts polished concrete floors, new bathrooms, exposed 14-foot ceilings and modern architectural lighting. The IgnitedSpaces facility will feature large private office suites, multi-purpose event spaces, a photography studio, high tech meeting space, a theater and beautiful lounge space.

The center is owned by Jamison, who is currently undertaking the first phase of what will be a multimillion-dollar renovation of the property, which is considered by many as the most important fashion mart in the Western United States. Jamison has converted a portion of existing space to accommodate the demand for creative space in Downtown Los Angeles.

“While still largely a trade building, we
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Please contact us with any comments or questions at questions@spamdex.co.uk. Spam Archive is a non-profit library of thousands of spam email messages sent to a single email address. A number of far-sighted people have been saving all their spam and have put it online. This is a valuable resource for anyone writing Bayesian filters. The Spam Archive is building a digital library of Internet spam. Your use of the Archive is subject to the Archive's Terms of Use. All emails viewed are copyright of the respected companies or corporations. Thanks to Benedict Sykes for assisting with tech problems and Google Indexing, ta Ben.

Our inspiration is the "Internet Archive" USA. "Libraries exist to preserve society's cultural artefacts and to provide access to them. If libraries are to continue to foster education and scholarship in this era of digital technology, it's essential for them to extend those functions into the digital world." This is our library of unsolicited emails from around the world. See https://archive.org. Spamdex is in no way associated though. Supporters and members of http://spam.abuse.net Helping rid the internet of spam, one email at a time. Working with Inernet Aware to improve user knowlegde on keeping safe online. Many thanks to all our supporters including Vanilla Circus for providing SEO advice and other content syndication help | Link to us | Terms | Privacy | Cookies | Complaints | Copyright | Spam emails / ICO | Spam images | Sitemap | All hosting and cloud migration by Cloudworks.

Important: Users take note, this is Spamdex - The Spam Archive for the internet. Some of the pages indexed could contain offensive language or contain fraudulent offers. If an offer looks too good to be true it probably is! Please tread, carefully, all of the links should be fine. Clicking I agree means you agree to our terms and conditions. We cannot be held responsible etc etc.

The Spam Archive - Chronicling spam emails into readable web records

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Spamdex - The Spam Archive Located in London, SW19 8AE. Phone: 08000 0514541.