Production center opens downtown building targeting entertainment industry clients.
DOWNTOWN — The Hollywood Production Center celebrated the opening of its newest office building Thursday, even as it enters a market with low demand and more than 1 million square feet of empty downtown work space.
Hollywood Production Center, which owns a property in Hollywood and another downtown, hopes its new 70,000-square-foot building on the corner of Broadway and Louise Street will draw tenants as a space for entertainment-industry workers or individual entrepreneurs who are not interested in conventional offices.
The center’s open lobby, with curvy suede arm chairs and blue accent walls, leads directly to individual offices and suites, giving tenants the opportunity to mix and network, said Lucy Mardonovich, the company’s general manager.
But while Hollywood Production Center has historically succeeded in drawing entertainment-industry tenants with flexible leases and stylized work spaces, the company did not start the project expecting to be opening during a recession, Mardonovich said.
“We didn’t know the economy was going to take a plunge,” she said.
The company has relied on buzz for its new building, which features “the best rooftop in Glendale,” with cushioned seating areas and a view of downtown, she said.
Eight tenants have signed leases so far, and 15 others are applying for spaces in the building, she said.
Still, the challenges of the office market, in Glendale and elsewhere, have not gone unnoticed, she said.
The company’s 150,000-square-foot property on Brand Boulevard has 20,000 square feet of unleased space, she said.
That’s better than the conventional real estate market, where about 20% of total downtown space is empty.
The new Hollywood Production Center building could make that market increasingly competitive for real estate brokers trying to fill unleased floors, said Patrick Church, a senior vice president at C.B. Richard Ellis who specializes in the tri-city commercial real estate market.
“Adding 70,000 [square] feet to the inventory with the Hollywood Production space doesn’t help,” Church said.
The center will add to competition, even though it targets a niche real estate market of workers in creative professions, Church said.
“It’s a specialty use that they’re after, so they’re not necessarily competing with the industrial high rises for the same tenants,” he said.
But the property is still offering office real estate, he said.
The new Hollywood Production Center building will also add an attractive space for entertainment-related businesses that will be important for the city in the long run, said Kenn Hitts, Glendale’s economic development director.
Officials approached the company when it was looking for a developer to purchase and reposition the building, a former property of the Los Angeles County Department of Public and Social Services, Hitts said.
Glendale’s Redevelopment Agency had hoped to leverage downtown’s proximity to media giants like DreamWorks, the Walt Disney Co. and other entertainment firms by drawing more industry talent to a specialized property, he said.
“Their presence stands out primarily because of the niche market that they cater to,” he said. “They’re taking advantage of Burbank and Glendale, which is clearly one of the largest employment centers for entertainment in the region.”
http://articles.glendalenewspress.com/2009-11-13/business/gnp-opening111309_1_unleased-real-estate-tenants
