SANTA MONICA, CA-The Lionstone Group, a Houston-based investment firm, has sold its ground leasehold interest on a four-acre parcel at 1800 Stewart St. in Santa Monica to biotech company Agensys Inc. Agensys plans to build a new 160,000-square-foot headquarters on the site.
The two buildings currently sitting on the site will be demolished for the $95-million project, which will be ready for occupancy by Agensys in early 2013. The biotech firm—which specializes in the development of proteins to fight cancer—will consolidate its six separate office, R&D, manufacturing, and laboratory facilities into the new development. Construction will begin this month on the project, which is designed to accommodate the firm’s rapid growth from 180 employees to more than 300 over the next three years, according to Agensys executive vice president of finance and operations, Paul Kanan.
Kanan explains that the company’s first choice had always been to stay in Santa Monica due to its amenities for its employees, many of whom live in the area. “It’s been a challenge to find adequate space in Santa Monica to accommodate this new facility which is essential for our continued growth. “We were founded in Santa Monica 14 years ago and it is great to be able to stay here and build the special facilities we need for our cancer research and manufacturing of antibody products.”
This sale required almost two years of discussions with the City and local officials to obtain the assurances needed to move forward, says Dan Dubrowski, a founding partner of Lionstone. The former American Standard water heater manufacturing facility has remained bare since being shuttered by the kitchen and bath appliance manufacturer in 1980. Currently located on the site south of Olympic Boulevard, are several obsolete steel Butler and concrete tilt-up industrial buildings that were built between 1950 and 1970, according to a prepared statement. The property is immediately adjacent to the Bergamot Station Art Center and the future 26th/Olympic station of the planned Expo Light Rail Line that will run from downtown Los Angeles to Santa Monica. The site is part of a nine-acre parcel acquired by the City of Santa Monica in 1989 from Southern Pacific Railroad and was considered for use as a maintenance yard for the planned 15.2 mile Expo Light Rail Line. The Lionstone Group acquired the ground lease on the four-acre parcel in 2007 through Lionstone Cash Flow Office One LP, a joint venture between Lionstone and the Oregon Public Employees Retirement Fund.
Jim Jacobsen and Scott Rigsby of Santa Monica-based Industry Partners acted as the local operating partner for The Lionstone Group in the transaction. The sale of the ground leasehold to Agensys follows extensive negotiations with the City, initially to keep the proposed light rail yard off the 1800 Stewart site, and later to secure development approvals and extend the lease term, which was set to expire in 2030, according to Jacobsen, Lionstone’s operating partner for commercial real estate development and brokerage.
“This was an extremely complex transaction with several moving parts, not the least of which was a comprehensive development agreement that provides numerous public benefits to the City, including a sculpture garden, pedestrian walkway, public caf
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
