Steve Crane of DAUM Commercial Real Estate Services’ Newport Beach office reports his representation of the buyer, BNY Enterprise LLC, in the acquisition of an 18,000 square foot industrial building in Bellflower. The property is located at 8832 Ramona St. and occupies 1.74 acres of land. Total consideration was $1.36 million. Daniel Kruse of Lee & Associates - Orange represented the seller.
Commercial Real Estate Services represented both parties in the sale of a
12,175 square foot industrial building located on one acre of land at 2300 N.
Batavia St. in Orange.
Chris Migliori of DAUM’s Newport Beach office represented both
the undisclosed buyer and seller. Total consideration was $1.95 million.
A worker moves finished steel products in the temper mill at California Steel Industries in Fontana on Feb. 18. California Steel has had steady job growth since 2010 after positions were left vacant in wake of the recession. The company currently has more than 900 full-time employees, and is looking to hire more. rachel luna - staff photographer
California’s manufacturing sector has lost hundreds of thousands of jobs to automation and increased efficiencies, but those same factors have sharply increased productivity.
As a result, the state remains competitive in both high-tech production and low tech industries, such as apparel and food processing.
Those assessments are included a newly released report from the Los Angeles County Economic Development Corp.’s Institute for Applied Economics.
“California’s Manufacturing Industries: Employment and Competitiveness in the 21st Century” highlights an industry that has been transformed by advances in material sciences, the explosion of computing power and globalization.
The report notes that California’s manufacturing output in 2012 was up 46.7 percent over 1990 and that California is the largest state contributor to the nation’s manufacturing GDP. But California’s manufacturing industry lost 842,180 jobs between 1990 and 2012 as a result of outsourcing, offshore production, automation and increased efficiencies. That made for a decline of nearly 40 percent.
Anyone who has walked into a manufacturing plant in recent years will tell you things have changed.
These days products are designed digitally instead of laboriously with pencil and paper. And the engineering process is sometimes done in the cloud. That means the design team could be in Shanghai or San Jose, while the manufacturing may take place in Vietnam — or Valencia.
And prototype parts can now be made using 3D printers. Hiren Patel, a project and quality manager for 3D-CAM in Chatsworth, said his company provides “rapid prototyping.” That gives engineers, designers and inventors dimensionally accurate plastic parts they can hold, test and show in a matter of days, instead of the weeks or months it used to take with conventional manufacturing.
“It depends on the complexity of the part, but it’s usually just two to three days,” Patel said. “We’re pretty busy these days.”
The industry’s high-tech transformation has reduced the need for production workers. With increased automation, fewer people are needed on production lines. A production line that used to require several workers might now operate as an automated line with a single technician controlling and monitoring the process with a computer-controlled device.
And complaints? They’re nonexistent when you’re operating an automated line that runs continuous shifts without breaks for coffee, lunch or vacation.
Increased productivity through automation and moving offshore “shows no sign of abating in the near future,” the report said, and employment declines will continue as businesses seek out new ways to become more efficient.
Globalization has created broadened opportunities in the manufacturing sector, but it has also ramped up competition. The report also notes that “human capital is mobile.” Globalization and communication networks have made it possible to assemble creative research and design teams from highly-skilled, and highly-educated workers living anywhere in the world.
The report also highlights California’s industry “clusters,” which are important for driving regional competitiveness, as firms in clusters can more easily learn from each other, share resources, spur innovation and operate more efficiently.
The state’s top industry clusters are aerospace vehicles and defense, biomedical, communications and equipment services, fashion, food processing and manufacturing.
Los Angeles County lost nearly 169,000 manufacturing jobs between 2002 and 2012, the study said. However, the region continues to be a manufacturing powerhouse, with more than 365,500 jobs in manufacturing industries in 2012.
The Inland Empire shed more than 27,550 manufacturing jobs between 2002 and2012. The two-county region employed an average of 86,264 people in that sector in 2012.
Manufacturing processes in both high-tech and low-tech industries have grown increasingly dependent upon technical tools, and specialized training is crucial, the report said.
“Many people who have lost their jobs are not suited for the new jobs that are out there,” said Edward Leamer, a professor of economics at UCLA and director of the UCLA Anderson Forecast. “We need to offer a different kind of education. The most important thing to have when you graduate from college is the thirst for knowledge.”
Some manufacturing firms are more than holding their own. That includes Warmelin Precision Products, a high-end machine shop in Hawthorne that makes parts for commercial and military aircraft.
“Business in aerospace defense is booming and will be for the next 10 years,” Ron Bohannon, the company’s vice president said. “Our sales will be up 25 percent this year and we expect that same kind of increase next year.”
Bohannon acknowledged that nearly all of his equipment is automated. But it takes more than technology to run the place, he said.
“All of this equipment still requires human monitoring and a skilled workforce,” he said.
U.S. Bank Tower, the tallest building in the West, will soon have an observation deck and sky-high restaurant catering to visitors to downtown Los Angeles.
The deck, the first of its kind in Southern California, will provide visitors with a sweeping view of Los Angeles, stretching from the hills of Glendale to Catalina Island.
The 72-story skyscraper, completed in 1989, will remain an office building, the owners said Tuesday, but it will get about $50 million worth of improvements, including a makeover of the lobby.
Singapore investor Overseas Union Enterprise Ltd. bought the tower at 633 W. 5th St. for $367.5 million last year. It was only about half occupied, and market observers speculated that at least some of the empty space might be converted to hotel or residential use.
But “it doesn’t make any sense” for the tower to be anything but offices, said Richard Stockton, chief executive of the Americas for OUE. The floors are too big for other uses, he said.
The Library Tower is doing this to beat the Wilshire Grand to the punch. But when the Grand Hotel opens, the tourists are going flock their to watch the view because visitors don't have to pay to visit their observation deck. I also think 25 dollars is too expensive to get the chance of…Derekgrrrrrrat 9:50 PM July 15, 2014
OUE will instead try to capitalize on the tower’s height to make it a busy tourist attraction like the Empire State Building in New York and the Willis Tower in Chicago, both of which are more than 100 stories tall.
The top floor of U.S. Bank Tower is to remain offices for rent, but the 71st floor below it will become home to a restaurant. The space once occupied by executives of First Interstate Bank has 18-foot ceilings and 360-degree views of the Los Angeles basin.
The 69th and 70th floors are to be connected by a interior stairwell and made into an observation and meeting space. The 69th floor already has terraces that will be opened up to form outdoor viewing spaces. Visitors can see past Long Beach to Santa Catalina Island on a clear day.
OUE anticipates that the observation deck could attract 500,000 people per year, each of whom would pay around $25 for entry.
A crucial requirement for moving so many people through a working office building will be a separate entrance for the day trippers, Stockton said. OUE will create a new portal on the second floor to serve visitors and upgrade all the elevators to make them more efficient.
City approval of the changes is required, but Stockton said he hopes to complete the observation deck by the second quarter of next year. Architecture firm Gensler is designing the improvements.
Other planned changes include a “modernization” of the U.S. Bank sign atop the tower, Stockton said, and the addition of a curb cut outside the front door on 5th Street so car passengers can load and unload off the busy thoroughfare.
The building originally had a curb cut, but it was filled in after the Sept. 11, 2001, terrorist attacks. The tower was viewed at the time as a potential terrorist target.
U.S. Bank Tower will soon have competition as a tourist attraction when the slightly taller Wilshire Grand hotel and office complex is completed in 2017. The $1-billion skyscraper being built nearby at Wilshire Boulevard and Figueroa Street will include an observation deck, infinity swimming pool and restaurant at the top.
Twitter: @rogervincentCopyright © 2014, Los Angeles Times
By Andrew Edwards Tuesday, July 15, 2014
Traffic at the Port of Los Angeles increased by nearly 14 percent on a year-over-year basis in June as shippers moved up their cargo due to the possibility of a work stoppage at the nation’s busiest seaport.
The port handled about 736,000 containers in June, the greatest amount since September 2012. The volume of June’s imports rose nearly 17 percent above the same month last year, while exports increased by about 9 percent.
Port spokesman Phillip Sanfield said the pace of business has increased throughout the year, so it is difficult to assess how much of the increased port volumes are due to attempts to frontload shipments in advance of any labor strife between port operators and dockworkers, and how much is due to a general increase in business.
The potential labor risk stems from the ongoing contract talks between the Pacific Maritime Association and International Longshore and Warehouse Union. Outside of a brief disruption caused by a truckers’ strike on July 8, dockworkers have remained on the job in Los Angeles and Long Beach after their contract expired at the end of last month.
“Our position is, retailers have options and if they’re frontloading and bringing in cargo to our port early, that’s better than going to another port,” Sanfield said.
Truckers who went on strike last week are short-haul drivers who demanded that three local trucking firms hire them as full-fledged employees instead of treating them as independent contractors. Sanfield said the trucking issue has not caused a problem at the port. Los Angeles Mayor Eric Garcetti negotiated a cooling off period over the weekend.
Just Sold: 22,400/SF Industrial Manufacturing Plant in Colton, CA: The 2 building manufacturing property was sold to a private investor. The new owner intends to rehab and reconfigure the property to accommodate 2 separate tenants and/or resale to an owner/user.
Just Listed: For Sale or Lease; 17,659/SF Freestanding High-Image Industrial Warehouse in Redlands. 2 DH/1 GL Doors, 3,000/SF Office with separate Retail/Showroom Component; Available November 2014; Call or Email for details and pricing:
Private sector employees in June added 262,000 jobs and government agencies added 26,000 positions, for a net gain of 288,000 new jobs that will potentially have a substantial impact on commercial real estate, according to a Marcus & Millichap report. During June, the unemployment rate fell to 6.1 percent from 6.3 percent in May, reaching its lowest level since September 2008.
According to the commercial real estate services provider, these new jobs will create demand for rental housing, strengthening the 20 basis-point rise expected this year that will bring the national vacancy rate to 5.2 percent.
Marcus & Millichap predicts that growth in degreed professional and business service fields, as well as those in the financial services, will fill vacant office space and generate demand in the remaining quarters of this year.
An increase in office property operations will result in a 120 basis-point drop in U.S. vacancy to 14.8 percent this year.
Robert Bach, director of research for the Americas with Newmark Grubb Knight Frank, says the growth was “robust.” He also believes the increase in jobs in the sectors most important to commercial real estate will support net operating incomes as space is filled and rents move higher. This will, in turn, he says, support investment activity.
During the second quarter of 2014, an average of 272,000 total positions were added monthly, surpassing the average monthly gain of 190,000 new jobs in the first quarter. The office-using sectors, comprising information, financial activities and professional and business services, added a combined 93,000 jobs in June, well above the previous six-month average of 51,900.
— Scott Reid
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IRVINE, CALIF. — The 210-room Courtyard by Marriott has opened in Irvine. The $50 million hotel is located at 7955 Irvine Center Drive, across the street from the Irvine Spectrum Center.
The new hotel features an 82-foot saltwater lap pool, 1,800-square-foot fitness center, lounge area, bistro, 5,000-square-foot ballroom, 3,000-square-foot events lawn for outdoor activities and 8,500 square feet of meeting space.
The development team includes developer R.D. Olson Development, architect WATG and general contractor R.D. Olson Construction. R.D. Olson Development will retain ownership of the hotel, while Marriott International will provide management services.
"These are exciting times for the Irvine Spectrum," says Doug Holte, president of Irvine Company Office Properties. "We have worked with R.D. Olson and Marriott to create a hotel that builds on the dynamic downtown vibrancy of the Irvine Spectrum and complements the world-class office workplaces, shopping, dining and entertainment that make this one of the premier workplace communities in Orange County."
R.D. Olson has plans for an additional 175-room hotel on the parcel adjacent to the Courtyard by Marriott Irvine Spectrum, with a groundbreaking expected in early 2015.
Beverly Connection’s tenant roster includes Old Navy, Nordstrom Rack, Men’s Wearhouse and Marshalls.
LOS ANGELES — Vornado Realty Trust (NYSE: VNO) has completed the previously announced sale of Beverly Connection, a power shopping center in Los Angeles, for $260 million. The property’s tenants include Old Navy, Nordstrom Rack, Men’s Wearhouse and Marshalls.
The 335,000-square-foot center is located at La Cienega and Beverly boulevards across the street from the Beverly Center, an upscale shopping mall with 160 retailers and dining options.
The sales price is comprised of $239 million in cash and $21 million in 10-year seller financing. The sale resulted in a net gain of approximately $44 million for Vornado, which will be recognized in the third quarter.
Vornado did not disclose the buyer, but the Los Angeles Times reported that the buyer is Ashkenazy Acquisition Corp., a New York-based private real estate investment firm. Michael Alpert, president of Ashkenazy Acquisition Corp., revealed that the company plans to invest an additional $500 million in the greater Los Angeles area in the near term. The company owns more than 100 retail, office and residential properties in the United States and Canada valued at $5 billion.
Vornado Realty Trust is a fully integrated equity real estate investment trust (REIT) based in Paramus, New Jersey. Vornado’s U.S. portfolio spans 100 million square feet, with the majority of properties located in New York and Washington, D.C.
Vornado’s stock price closed Wednesday at $106.37 per share, up from $85.47 per share this time last year.
— John Nelson