PacTen Partners, lead developer of Southern California's first speculative high-rise office tower since early this decade, is jumping on a second major commercial real estate development opportunity as well.
Glendale-based PacTen will develop a multiphase 700,000-square-foot "campus-type" project to be known as Valencia Corporate Point within the master-planned Gateway Commerce Center in the high-demand Santa Clarita Valley, said veteran real estate professional Pete Hillman.
Hillman and longtime friends and industry colleagues Nyal Leslie and Dennis Fitzpatrick--all of whom played collegiate sports at schools now in the Pacific 10 Conference--are PacTen's principals. In partnership with Morgan Stanley Real Estate Fund II, PacTen recently completed the steel frame of the 24-story $102-million Glendale Plaza in downtown Glendale.
PacTen is near an agreement with a financial partner for the projected $85-million Valencia development, Hillman said, and expects to soon complete the site acquisition from Newhall Land & Farming Co. Ground will be broken this summer, with the first buildings ready for occupancy next spring, Hillman said.
Hillman added that he's had discussions with prospective tenants interested in occupying buildings with relatively large 40,000-square-foot floor plates that would probably rent for $1.15 to $1.25 per square foot on a "triple net" basis--that is, with the tenant paying for utilities, maintenance services and other facility costs.
Hillman and others have noted high tenant interest in most of the office and industrial buildings recently completed in and around Valencia. David Mgrublian, managing partner with L.A.-based real estate firm Investment Development Services, said grading could start this week on the first phase of the $40-million Vista Business Park industrial center IDS is developing within the Valencia Commerce Center on behalf of Seattle-based pension fund advisor Kennedy Associates Real Estate Counsel.
Like PacTen's nearby planned project, the IDS team is going ahead with the project on a speculative basis--no tenants have been signed. IDS also is acquiring the property from Newhall Land. The first phase includes two high-end industrial buildings totaling about 320,000 square feet slated for completion in October, with two more buildings totaling about 420,000 square feet opening as early as December.