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2/12/16
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A 10.3k sf office building in the San Fernando Valley’s Warner Center/Woodland Hills submarket has traded for just under $4.7 mil, or $470 per square foot. The property, located at 5947-5951 Variel Ave, west of De Soto Ave and south of Oxnard St, received multiple offers.
The building was purchased by an owner user, Macland Investments, an operator of gas stations. The firm will use the space for administrative offices.
The seller, a private investor, acquired the property in 2012 as a two-tenant property and renovated it for single tenant use with high-end, modern finishes. The property no longer fit with the company’s business model, and, along with rising prices and high demand for properties of this type, resulted in the sale.
Scott Romick, managing director and principal of Lee & Associates-LA North/Ventura, represented the seller in the transaction. According to Romick, demand for office buildings of this size is high in general, and the location of this property, in the Warner Center Specific Plan, also offers a potentially lucrative exit strategy for a buyer.
The recently revised Warner Center Specific Plan relaxes a number of development restrictions, and it is believed that properties within the Specific Plan borders will become highly sought after by developers, particularly those who seek to aggregate parcels for larger developments.
“We’re seeing a big spike in businesses seeking to own their own buildings in order to control overhead expenses and support their branding and identity, Romick said. “So it is not surprising that we ended up with a per square foot price that is more than double the median in the area.”
The median price of office buildings sold in the Los Angeles North region was $212 per square foot. Although smaller buildings typically trade at the high end of the range, the sale price of the Variel Ave was high by any standard.
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