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Firms Make Creative Use of Industrial Space on Westside

Architect Frank Gehry, film and ad companies are among tenants migrating to manufacturing area north of LAX.

June 10, 2003|Roger Vincent | Times Staff Writer

It's big enough to house a commercial jetliner and close enough to the ocean that he can smell the sea air when it blows through the massive open doors.

"This is it," architect Frank Gehry said in his new office, surrounded by art books, a plywood desk and his signature cardboard chairs. "I'm 74, and I don't want to move again. I'm in pig heaven."

Gehry -- whose designs include the nearly-completed Walt Disney Concert Hall and the Guggenheim Museum in Bilbao, Spain -- is the latest creative heavyweight to make over a former manufacturing building in this tiny neighborhood just north of Los Angeles International Airport. The businesses that have migrated here include visual effects company Rhythm & Hues Studios Inc., advertising agency TBWAChiatDay and Internet design firm Razorfish Inc.

The once-industrial enclave occupies a few blocks across the street from the sprawling Playa Vista residential development and around the corner from Water's Edge, an office component of Playa Vista where another large creative firm might soon open shop.

Real estate sources say video game developer Electronic Arts Inc. is negotiating with Water's Edge landlords Maguire Partners and Equity Office Properties to move in and create an elaborate campus with amenities not seen since the heyday of the Internet, such as a skateboard park and a sand volleyball court.

Indeed, fun things to do and to eat are in short supply in the area. The lack of stores and restaurants within walking distance is the subject of complaining and dark humor among the locals, one of whom recently took the opportunity to gently mock the celebrated newcomers.

"The Gehry people wanted to know where the Starbucks was," Rhythm & Hues spokeswoman Suzanne Datz said. "Make your own coffee!"

Datz doesn't really have to make coffee -- the computer animation studio that created Coca Cola's cavorting polar bears and the digital effects for "X2: X-Men United" serves three meals a day in its own commissary.

Gehry Partners doesn't have food service, though its building at 12541 Beatrice St. is about half empty and another tenant might have an appetite for a kitchen. Gehry is looking for a business to share space under his roof.

"Frank was yelling at me to find a building," said his real estate partner, Larry Field, chief executive of NSB Capital Partners. The two formed a partnership to buy a 73,000-square-foot building last used by BMW. Gehry redesigned the building, adding space that will bring the total size to 90,000 square feet.

"The space is so extraordinary, it changed our outlook on life," said Gehry, comparing it to the firm's cramped former offices in Santa Monica. "Morale has improved a lot."

He hopes to find a tenant his firm can collaborate with, he said.

The area's shift to creative uses reflects changing business patterns in the region, said economist Lisa M. Grobar, director of the Cal State Long Beach Economic Forecast Project. Notably, she said, employment in the aerospace industry has been in decline for the last five years and the manufacturing industry has been shrinking since 1999.

"Some reasons are temporary like 9/11 and the recession," she said. "But there is a long-term trend where manufacturing is really not an industry that has created a lot of jobs."

Employment in aerospace products, parts and manufacturing in Los Angeles County fell from 65,100 jobs in 1998 to 44,000 in 2002, according to the state Economic Development Department.

Most of the buildings in this commercial real estate pocket of more than 100 acres north of Jefferson Boulevard were built in the early 1970s in what was called the Airport Marina Industrial Park, said longtime Westside commercial real estate broker Tim Macker of Coldwell Banker Commercial Westmac.

"It was reclaimed swampland across from Howard Hughes' airfield," Macker said.

Several warehouse and distribution firms set up shop along with a few white-collar businesses, including the headquarters of the Sizzler steakhouse chain. "It was fairly expensive real estate for the time," he said.

More than a decade ago, monthly rents were about 75 cents per square foot, Macker said. Today the average is more like $1.25, he said, which is a bit rich for industrial users. But it sounds like a bargain to business operators from Santa Monica or Hollywood, where office rents can be more than twice as high. Vacancy rates in industrial buildings around Marina del Rey are about 11%, he said.

One Hollywood transplant is Dennis Curtain Studio, which creates product packages for television commercials. The firm moved six years ago to escape the heat, the smog and "the riffraff," representative Tina Walter said.

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