City Close to Making Deal on Key Business Site

Malibu city officials indicate that they are poised to seal a deal with a real estate development company to take over the leasing arrangements of the old lumber yard site.

The city, during the summer, conducted a solicitation and selection process to determine possible candidates for occupying the site that became available when Malibu Lumber vacated the premises.

By the end of June, the city council had hired a law firm, Brown, Winfield and Canzoneri, that specializes in commercial leasing by public entities, to help select a bid.

Of the nine proposals, bidders were narrowed down and then several finalists were chosen.
The council’s ad hoc committee, consisting of Councilmembers Sharon Barovsky and Pamela Conley Ulich, sat in on interviews of the finalists. It is believed the full council tentatively tapped one of the top finalists at its closed door meeting last week.“

I don’t have any comment to make other than we are in the midst of negotiations,” said City Attorney Christi Hogin, who declined to comment on whether a top contender had been chosen.

Barovsky, who also declined to name the top choice, did elaborate. “We have not selected a project yet. We have narrowed it down to one project, but we are doing our due diligence,” she said.

The council member said the city was looking for a project that could serve the needs of the community, set aside a certain percentage of space for local retailers and meet the requirements for debt service.

There were two remaining finalists; Weintraub Financial Services, Inc. and Watt Realty Advisors, which is a Santa Monica-based realty firm, according to sources familiar with the selection process.

When contacted, some of the finalists indicated they were not the top pick. Others would not speak for the record. One had dropped out earlier.

“We were told we did not make it,” said Tony Dorn, one of the local firms submitting a bid through Beitler Commercial Leasing, an agency that represents commercial properties in Malibu and the Westside.

Another local firm, J.S. Rosenfield & Co.—best known for their remodeling of the Brentwood Country Mart and the newest owner of the Trancas shopping center—dropped out of the bidding process. One of the principal partners, Dan Bercu, said, “We dropped out a long time ago. The city wanted way too much paperwork and renderings. We were not willing to spend time specing out before closing.

”Michael Koss, of Koss Financial, said he did not believe he was the top choice. “I was on the short list, but to the best of my knowledge, I’m not the person. I don’t know who has been selected,” he said.

A proposal came from Martin Landis, the CEO of Landis Management, a real estate advisor who oversees acquisitions, asset management and disposition of real estate projects.

Others who entered the fray include local Realtor Kristen Corri, who represents World Vest Land & Development, Patrick Saboorian of Saboorian & Associates, Robert K. Futterman and Associates, a New York-based real estate agency that primarily serves the New York City market, but has also extended its services into the LA-area, including a well-known commercial/retail space at Hollywood and Highland.

The municipality is seeking proposals for a master lease for a 39-year maximum term with a 15-year option on approximately 2.2 acres of commercial zoned property. The main building first floor is about 17,000 square feet with a mezzanine of approximately 5,000 square feet with accessory buildings comprising 5,000 square feet.

Some of the other basic proposal requirements besides the long term lease, according to the city, are triple net lease, with the minimum anticipated lease amount of $850,000.

While most locals had hoped the site might be filled by another lumber or hardware store, most real estate experts indicated the debt service required of any renter precluded any one retailer, but would appeal to a real estate development firm that might want to rehab the buildings and bring in several tenants, in effect, creating a small shopping center.

The recent remarks made by Barovsky seem to indicate that is the direction city officials are now headed toward. Barovsky said she is holding out hope for a project that she would be proud of long after she leaves the council and one she could continue to benefit from as a consumer.

The city acquired the vacant lumber yard property when it purchased the building, two other commercial properties and the vacant land known as the Chili Cook-Off site. Municipal officials expect to use the rent obtained from the commercial properties including the lumber yard to pay off the debt incurred to acquire the land and buildings.

BY BILL KOENEKER