Industrial nook becomes target for new residential buildings. (Spotlight on Marina Del Rey).

THERE'S a quiet stretch of Marina del Rey that until recently has resisted the area's ongoing transformation toward shopping centers and residential towers.

The neighborhood, bordered by Lincoln and Washington boulevards and Redwood and Maxella avenues, contains small industrial shops, along with some production and design studios. Up until now, the draw has been low rents and a convenient location.

But change is in the works, thanks to an influx of new higher-end residential projects along Glencoe Avenue, which bisects the area.

Tierra Del Rey, a 171-unit apartment building on the corner of Maxella and Glencoe, was built in 1999 by TriCal Construction Inc. The $30 million Villa Fontaine, with 102 upscale apartments, was completed this month by Trammell Crow Residential. And TriCal has recently leveled buildings to begin construction on two lots nearby that will include as many as 200 units.

Commercial tenants, meanwhile, could be priced out of the market when their leases are up.

"We're now sub-leasing month-to-month, so I'm hoping the owner doesn't raise the rent," said Eduardo Galvan, president and co-founder of ETAmerica Corp., a provider of earthquake and first aid supplies. He sublets a warehouse on Glencoe Avenue for about $2 a square foot.

Safe streets

Besides price, Galvan said security and convenience were factors when he chose the site over other possible locations in Culver City and Van Nuys. "It's a lot safer here, and there's lots of shops and restaurants around." he said.

Until 1993, the area was zoned for light industrial and commercial. An adjustment allowed new residential projects, but it was enacted during a housing construction slump.

"At that time, very little housing was being built anywhere in the city," said Con Howe, director of L.A.'s Department of Planning. "You can change the regulations, but unless the market is ready to build, nothing will happen."

From 1991 to 1993, the number of construction permits for multiple family rental units fell to 1,168 citywide from 4,200. By last year, construction had recovered, to 4,996 permits. More than 10 percent of the projects were in the Palms/Mar Vista/Marina del Rey area.

The area had earlier housed small manufacturers and distributors, many of which remained until the early 1990s. But those firms were pretty much priced out of the market at the onset of the dot-coin boom, said Doug Marshall, a principal at Kiabin Co.

"There's been a southern migration moving down to cheaper quarters in the South Bay area," said Marshall, who has represented commercial landlords in the area since 1984.

From 1995 to 2000, Marshall said, developers bought up buildings and converted them into modern creative spaces to get higher rents.

Current tenants include KA Architects, NBBJ Architects and Web services firm Guidance Solutions Inc. At about $1.25 per square foot, the new tenants pay more than their industrial predecessors, but still about half that of comparable spaces in Santa Monica.

Web site and e-commerce systems builder Guidance Solutions managed to hang on after the dot-coin collapse by downsizing and taking over several buildings adjacent to its 10,000 square foot warehouse on Del Rey Avenue. It sublets the space to other high tech companies.

"When we outgrew our other offices, I was probably prepared to pay $2 to $3 a square foot for executive space," said Guidance president and co-founder Joe Tang. "Instead we're paying just over a buck a square foot."

One business benefiting from the combination of low rents and new residents is Angel City Fitness, which has leased a 20,000-squarefoot warehouse on Glencoe Avenue since 1997. Business has "skyrocketed," said Lisa Hockley, the gym's director of operations.

But for some tenants, the threat of eviction clouds any bright spots.

Stuart Karten, owner of Stuart Karten Design Inc., has been leasing his 6,000-square-foot studio 18 years. While his lease won't be up soon, he's concerned that interest from residential developers may tempt his landlord.

"There are clauses in my lease that with X amount of notice he can evict us if he sells the property," Karten said.