Novel Ownership and Design Concept May Shake Up Office Market
A recent site tour by Urban Land Institute showcased new solutions for businesses seeking office space. ULI Los Angeles’ case study and site tour was held at the under-construction elevon at Campus El Segundo development. Attending were El Segundo entrepreneurs and community leaders, dozens of Southern California’s top commercial brokers and land-use and design professionals.
elevon is the latest phase of the 46.5-acre Campus El Segundo: a 210,000-square-foot office community complemented by 13,500 square feet of high-end restaurants and retail. Spaces within the 15-building elevon campus range from 2,000 square feet to 28,000 square feet. These include opportunities to purchase entire buildings. That aspect – almost completely unique among new office offerings in the Los Angeles area – combined with the project’s distinct, residential-inspired design, makes elevon a new model that is quickly proving itself.
Prior to the hard-hat tour, a panel discussion explored the rapidly reshaping Southern California office landscape. Participants were Ehrlich ArchitectsFounding Partner Steven Ehrlich; CBRESenior Vice President Bill Bloodgood; Bixby Land CompanyPresident and CEO Bill Halford; and Endless Pursuit CorporationCEO Drew Boyles.
Bloodgood positioned elevon within El Segundo’s “active and changing” office market, observing that elevon’s space-ownership model accommodates business that may be growing or contracting: “It is much easier for an owner to lease space or sell their building than to sublease space in the middle of a lease term,” he said. He also mentioned the tax benefits of ownership.
This flexibility is mirrored in the design. Ehrlich Architects’ custom home designs are often featured in both Architectural Digest and Architectural Record (including within the last month). In elevon, the firm applies principles of comfort and community to the business environment.
“These are both condominium offices and individual buildings, each with their own private outdoor areas. There is a feeling of being in your own house,” said Ehrlich. “And they are set within an overall neighborhood context.”
The hard-hat tour previewed the design innovations: patios and balconies; roll-up garage-door openings for indoor/outdoor interaction; high ceilings and volume spaces; and natural materials. “We love that these are tilt-up concreted structures,” Ehrlich said. “Many owners will simply polish or stain the concrete floors and leave the steel beams exposed.”
Bill Halford compared the approach to Ian Schrager’s revolutionizing the hospitality industry by combining less-expensive materials and re-used spaces with a modern esthetic. Until now, the commercial real estate parallel has been the “creative space” trend, which targets tech and media firms, leaving other businesses to traditional corporate offices. Halford rejected that limitation: “Creative space is not only for ‘creative’ companies,” he said. “That is a farce. People of all kinds are not dreaming of working in corporate space. This is a place where people actually want to be.”
The novel approach is working, recent buyer commitments amount to 52,400 square feet, worth approximately $24.5 million in potential sales, and accounting for 25% of available space
By Alex J. Rose is Senior Vice President, Development, Continental Development Corporation