Thinking Small,
 Former Brownfield-Turned Industrial Park
  Scores Pre-Development Success

[ By David Allison ]

Voit Brea Business Park consists of single-user buildings ranging in size from 10,000 to 50,000 square feet, the category in highest demand in Industrial deveopment in Orange County, California.

How does a developer transform a piece of property that has contaminated soil, limited access and major grade differentials into a contemporary, master-planned industrial business park? In the case of Voit Brea Business Park, success is a combination of several factors: market knowledge, tenacity, expertise, teamwork and timing.

Woodland Hills-based Voit Development Company has transformed a 30-acre brownfield into a 535,000-square-foot industrial development, Voit Brea Business Park, the largest speculative industrial development that North Orange County, California has seen in more than a decade. The 16-building, $40-million industrial park was already a success in its pre-development phase, with several buildings in escrow before the first walls were tilted.

Voit Brea Business Park is comprised of single-user buildings ranging in size from 10,000 to 50,000 square feet, the category in highest demand in industrial development in Orange County, California. In the late '90s and early 2000s, developers were building large industrial and R&D buildings to accommodate the exploding tech industry, leaving little industrial product to meet the needs of the smaller user. The imbalance of supply and demand led Voit to build this product to relieve some of the pent-up demand that was escalating in the marketplace.

The early response and ongoing demand for this product proved that Voit's understanding of the market had been correct. Even before its 2002 groundbreaking in January, six buildings were in escrow. By the end of 2002, construction of phase one was complete and a total of four additional buildings were in escrow. Completion of phases two and three is set for Summer 2003.

Architecture, Functionality Attract Users

One component of the popularity of this park is the buildings' contemporary architecture. While many "traditional" industrial parks offer rows of cookie-cutter buildings, Voit Brea Business Park features buildings of varying square footage in three distinct designs. The buildings feature canopies over the main entrances, skylights and many other aesthetic features.

Another factor contributing to the buildings' popularity is their functionality. Providing good access, loading, power and 24-ft. clear heights ensured that the users would have features they needed to use the space efficiently.

With record low interest rates fueling the acquisition market, the park presents business owners with the opportunity to make smart investments in new buildings equipped with the most up-to-date technologies and the most current building specifications. In fact, all of the buyers in 2002 were relocating from leased facilities throughout the Southland.

Challenging Beginnings

It started in the early '90s when Mitch Zehner and Louis Tomaselli of Voit Commercial Brokerage's Anaheim Metro office noticed a large parcel of underutilized land that was owned by Unocal. The property had gone unnoticed or unappreciated by other local brokers because it was sandwiched between large industrial parks that virtually hid it. But, having worked in the Northern Orange County market for 10 years, Zehner and Tomaselli understood its intrinsic value.

The brokerage team spent years corresponding with the oil company, trying to convince it to sell the land by explaining how valuable their asset would be if sold. The oil company had only been using a small portion of the parcel, leaving the majority of it unused. After seven years of correspondence, information sharing and an ownership change from Unocal to Tosco, the two brokers convinced the new owner to sell all but the two acres of land on which the firm planned to relocate and consolidate its operations.

Voit Commercial Brokerage represented Tosco in the sale. Voit Development Company, the brokerage firm's sister company, had to compete with 12 other firms that bid on the site. In 2000, Voit Development Company was awarded the project only after the original buyer fell out of escrow. It was then that Voit worked with Tosco to come up with a suitable plan for its relocation and coordinated the logistics of its move with Voit's construction schedule.

Though many developers were interested in developing the land, the property presented obstacles to overcome. Knowing this, Voit Development worked with its long-time partners, Ware Malcomb Architects, Valley Commercial Contractors and Voit Commercial Brokerage in the due diligence phase to design a project that would meet the needs of the market in the most cost effective manner.

The first and most obvious issue was how the land had been used previously. Under its former owners, Unocal and Tosco, the property had been an oil and gas distribution center. Above ground, oil tanks and pipelines peppered the 30-acre property. Below ground, there existed a maze of petroleum pipes with no indication as to where they were located. Developing the site would require finding and removing the pipes, as well as remediation of any contaminated soil.

Another hurdle to overcome was the limited access to the site. The surrounding industrial parks restricted access to the buildings inside what would become Voit Brea Business Park. A new road had to be constructed to connect the surrounding main transportation routes directly with the business park. The problem was that the proposed road would run through an existing property adjacent to Voit Brea Business Park. To make way for the road, Zehner proposed that the neighboring owner exchange his antiquated building for one of the new ones that Voit was developing. The property owner gladly accepted the offer, keeping the construction of Voit Brea Business Park moving forward as planned.

Targeted Marketing
Campaign

A targeted marketing plan effectively reached commercial real estate brokers and users throughout the Greater Los Angeles and Orange County areas.

The marketing campaign included local advertising, local and national public relations, a direct mail email program and event marketing. The advertising campaign communicated a clear message with the headline, "If You're Looking for New Space, Why Not Get New Space." In a market in which the competitive product was mostly outdated, new clearly differentiated this product.

The marketing team consistently reinforced this message throughout all facets of the marketing program. The elements of the campaign included:

• Creating and placing ads in the national commercial real estate trade publications and local business journals.

• Designing and writing a 12-page insert for one of the local business journals.

• Providing reporters from the local media and national commercial real estate trade publications with experts to speak about the trends in industrial development.

• Regularly emailing updates about the park's construction milestones and new building sales to local-area brokers.

• Planning and executing a groundbreaking event and a broker open house.

• The open house was themed after the popular television show, "Fear Factor." The popularity of the television show and the local publicity that the broker event received drew an unusually large number of people to the event. The day's events included Fear Factor-like stunts, a tour of the business park and lunch from one of Southern California's most popular fast food chains.

Voit Brea Business Park is not only a success story for Voit Development Company. It is also a catalyst for economic growth. By creating a product that the market needed, it has attracted new businesses and stimulated job creation in the City of Brea. It also provided Tosco with the opportunity to realize profits on an underutilized asset without affecting its business operations.

David Allison is executive vice president and COO of Voit Development Company.