Lincoln Property Takes Up a Collection
- Jun 05, 2015
Lincoln Property Co. has acquired the Burbank Collection, a three-building Class A office campus situated on three acres in the heart of Downtown Burbank, Calif., from Kennedy-Wilson Properties Ltd.
Included in the deal were Burbank Executive Plaza at 300 E. Magnolia; Glenoaks Plaza at 303 N. Glenoaks Blvd; and 333 N. Glenoaks Blvd. The price of the transaction was not disclosed.
“Two main factors played into our interest. First, the improving fundamentals in the Southern California market, which is seeing a real bounce with sustained growth in tenant increases and vacancy rates, and in some specific submarkets, a fairly substantial increase in rental rates,” David Binswanger, Lincoln Property Company’s executive vice president, told Commercial Property Executive. “Second, was the assets themselves. It’s very rare that you can acquire a full city block in three separate buildings, all built separately but linked under one owner.”
Lincoln Property Co. plans to transform these properties and the two adjacent parking garages into a cohesive, walkable campus that reflects the design of the Burbank Village district. An unfinished loading alley bisecting the site will be transformed into a central pedestrian walkway that will adjoin new outdoor decks and terraced dining areas, connecting the three buildings and allowing people to work outside protected from the elements.
“The bones of this project allow us to go in and heavily renovate them, predominantly the common areas, but also the traditional commodity office and turn it into a more creative model,” Binswanger added. “That means good ceiling heights, polished concrete floors and renovating the restrooms.”
The buildings are currently 83 percent occupied with a tenant roster that includes leading companies in the entertainment and creative industries, such as Cartoon Network and Nickelodeon.
According to Binswanger, Burbank has a lot of cachet for its entertainment presence and is a good alternative for many of the old-line and new-line entertainment companies that are looking to move from Hollywood, as the vacancy level is much higher at 14 percent.
“We clearly see between the market and renovation, an ability to drive a higher rent in that we’re transforming the campus into something that it isn’t today,” he concluded. “The plan is to lease up the space that is vacant, and we have a significant amount of rollover with more than 35 percent of the building rolling in the first three years, and hopefully we will have a high retention rate with those tenants.”
The property is located within walking distance of the Burbank Town Center, as well as an expansive collection of restaurants, retailers, entertainment, hotels and high-quality residential options.
The renovation is expected to be complete in early 2016.
Lincoln Property Co. was represented in the transaction by CBRE.