DEMAND FOR COMMERCIAL SPACE GROWING.

Byline: Jesse Hiestand Daily News Staff Writer

If ``lifestyle center'' sounds a bit vague, think of shopping along cozy pathways through tree-lined courtyards with fountains.

Developers in Simi Valley and elsewhere in the county are convinced customers will be drawn to retail settings that cross major outlets with a prefab, mini town square.

``It's an entertainment, family type of center and that's what we're going to see in a lot of new centers coming up right now,'' said Larry Tanji of CB Commercial's Ventura office.

CB Commercial, the largest commercial real estate company in Ventura County, issues a quarterly review that tracks trends in office retail and industrial occupancy and vacancy rates. Yesterday, first-quarter trends were announced.

Construction of Simi Valley's first lifestyle center, the Civic Center Plaza, is expected to begin this fall, just one of three major retail projects currently being planned or built in the city.

Simi Valley leads the county in planned construction of retail real estate and, along with Thousand Oaks and Moorpark, is setting the pace for steady growth in the county's retail market.

Overall demand for all types of commercial real estate - retail, office and industrial - is up despite slight first quarter increases in some vacancy rates, primarily in the office market.

``There is substantial investor demand for Ventura County properties,'' according to Jerry Pelton, senior vice president of CB Commercial's Ventura office. ``We've seen the level of interest get to a fevered pitch.''

Commercial real estate figures released Wednesday by CB Commercial show just how sharply the county is divided along east/west lines at the Conejo Grade.

In terms office space, west county areas such as Camarillo, Oxnard, Port Hueneme and Ventura have a 20-percent vacancy rate, double that found in east county cities such as Thousand Oaks, Simi Valley, Moorpark.

Demand for office space in the Conejo Valley is so great, and available space so limited, that some businesses are moving further west into Camarillo, according to Cathy Condon, a senior associate at CB Commercial.

In contrast, first quarter office vacancy rates in the west county are at their highest level in at least 13 years - 20.3 percent.

Although the long term trend is lower vacancy rates in the office market, the overall rate slightly increased in the first quarter, which surprised many in the industry, Condon said.

The unanticipated increases do not appear to be the work of any major market forces, Condon said, and Ventura County continues to be a desirable relocation destination for Los Angeles and San Fernando Valley businesses. The east county may dominate in office real estate, but the west leads in industrial real estate, with nearly four times as much square footage as the east county.

Industrial vacancy rates dropped countywide in the fourth quarter of last year. The west county posted a 5.8 percent rate while the east came in at 11.7 percent.

Oxnard and Camarillo lead the county in this sector, selling or leasing 300,000 square feet of industrial real estate in the first quarter of 1997. But demand for industrial real estate is beginning to outstrip supply.

The supply of quality industrial space of any size is shrinking. This may cause rent increases of up to 10 percent. It is also leading to some speculative development.

``We're seeing (industrial) rental rates going up just about across the board,'' said Jerry Steinke, a senior associate with CB Commercial.