DEALS SURVIVE SLOWER MARKET.

Byline: GREGORY J. WILCOX Real Estate

There is no doubt that commercial/industrial real estate has enlisted in the economic slowdown, the latest proof being the approximate $40 million cost-cutting program CB Richard Ellis Inc., the big real estate service firm, implemented last week.

But there is also ample evidence that the sector is not in the tank, especially in the San Fernando Valley area.

Big deals are still getting done and the softening economy has not scared off speculative developers in some cases.

Here are a few highlights:

--West Los Angeles-based Cypress has bought 18.7 acres at the 100-acre Conejo Spectrum in Thousand Oaks and plans to build 300,000 square feet plus of industrial space. Industry sources put the purchase price close to $9 million.

--Oltmans Construction Co. of Whittier is building The Arbors of Thousand Oaks, a $45 million campus office project on 16 acres fronting the Ventura Freeway at the northwest corner of Lawrence Avenue and Hillcrest Drive.

This project consists of three, two-story buildings totaling approximately 210,000 square feet. The first building, a 71,000-square-foot structure, should be finished by September.

It's also a big land-recycling project as The Arbors is on the site of the former Teledyne plant.

--And in Valencia, PacTen Partners, which has a big office complex under construction, is switching its focus to industrial uses to reflect current market conditions.

Jack Kyser, chief economist of the Los Angeles County Economic Development Corp., said the industrial market remains a bright spot for the regional economy.

New construction is continuing with 8.4 million square feet of space currently being built, and the vacancy rate continues to drop.

Last year ended with a vacancy rate in the county of 3.8 percent and it had dropped to 3.6 percent at the end of the first quarter. The industrial vacancy rate was 4.6 percent in 1999.

In the north part of the county, from the San Fernando to Antelope valleys, the rate was 4.1 percent last year versus 5.7 percent in 1999.

``What this says is people need to pay more attention to the industrial market. Many people make the statement that manufacturing jobs have gone away and we try to point out that (the sector) is still here. And if you want to build the middle class, this is the most effective way to do it,'' Kyser said.

As proof, Kyser offers the surprising fact that Los Angeles County ranks No. 1 in the nation for plastics manufacturing.

David Mgrublian, managing director of Investment Development Services Inc. in Los Angeles, the development manager for Conejo Spectrum, said only six acres remain available for sale in the project.

It's already a high-profile address as a 200,000-square-foot headquarters is under construction for Intel Corp.'s Xircom unit, the mobile communications product maker bought out earlier this year by the Silicon Valley giant.

``It's definitely a slowdown, but things are still getting done,'' Mgrublian said of the sector.

Lease rates reflect a tight market but they have been rising steadily rather than making big spikes, he said.

John DeGrinis of Colliers Seeley represented the Conejo Spectrum's owners and Cypress Land in the 18-acre deal, and says industrial property remains a nice niche, especially since vacancy rates in the Conejo Valley are in the 2 percent range.

So far, a tenant has not been lined up for Cypress' development.

``It continues to be a speculative project, but I wouldn't be surprised to end up with a build-to-suit for one of the buildings we are planning,'' he said.

BROKER BUZZ:

--Belmont Corp. has broken ground in Burbank for a senior citizens assisted living project.

The 107,500-square-foot Mediterranean-style building is at 455 Angeleno Ave. between between Fifth Street and Glenoaks Boulevard. It will have 150 units and include a special neighborhood for seniors with Alzheimer's disease.

Residents will receive personal support, meals, housekeeping and transportation.

--Senior Resource Group said it has preleased 100 apartments at the Village at Sherman Oaks, a 244-unit retirement community. The project is at 5450 Vesper Ave. and should open in about six months.

--The 1970s Valley treehouse look is gone. At least at two Oakwood apartment complexes, icons of 1970s single living.

Oakwood Worldwide is spending $35 million renovating Oakwood Woodland Hills at 22122 Victory Blvd. and Oakwood Toluca Hills at 3600 Barham Blvd. The latter location is where Jay Leno tapes his Jaywalking comedy segment.

The makeover includes golden wrought-iron balconies, colonial apartment doors and new lobbies.

--The North Los Angeles County Regional Center, a Van Nuys-based nonprofit organization that provides a variety of services for disabled individuals, has leased 10,675 square feet of space in Valencia Corporate Plaza. Terms are seven years for $1.3 million.

Stella Lee of Grubb & Ellis North Los Angeles office represented the tenant. Jim Lindvall and Bill Boyd, also of Grubb & Ellis, represented the landlord, ICW Valencia LP of San Diego.