THOUSAND OAKS, CA—After sitting vacant for two years on the market, an industrial flex asset in Thousand Oaks finally trades hands. The 90,000-square-foot property had been marketed by an unnamed brokerage firm as an office and R&D building for two years, until Colliers International took over the listing. Recognizing that demand in the market was much higher for industrial users, the Colliers team worked with the owner, First Industrial, to reposition the property as an industrial asset. After the repositioning, the property traded hands within nine months.

“The office demand in Thousand Oaks hasn't been nearly as strong as the industrial demand, so we thought on way to reposition the property was to take out a portion of the ceiling tiles that had been installed for the office space and show what the property was really capable of,” Patrick DuRoss, a VP at Colliers International, tells GlobeSt.com. “Even then, we were left with a little bit of a challenge because only 30,000 square feet of the total 90,000 square feet can be used for high-bay warehousing. However, there are a large portion of companies out there that are more warehouse related, and that could use a large portion of the space for assembly or another form of manufacturing. We actually had a good amount of demand for that type of user, and that is what we ended up finding as a buyer.” DuRoss represented the seller in the transaction, along with senior EVP John DeGrinis and associate VP Jeff Abraham.

In addition to taking out the drop ceiling, the owner also put in an oversized ground-level loading door. The property was marketed for both sale and lease, and the marketing team received several offers from users, looking to both occupy a portion or all of the building, and from potential buyers.

The building was purchased by a partnership operating under the name Herri Holdings LLC and will be occupied by its affiliate, Bocom Pharmaceuticals, a Chinese-based pharmaceutical manufacturing company. This is the company's first US location. “They looked at building throughout Southern California, and were close to making bid on a building in Orange County,” says DuRoss. “There are some big companies out here that are in the same industry, and I think it was a big draw for them to be located in an area with a strong employee base.” The partnership purchased the property for $9.9 million.

Thousand Oaks is located in the greater Conejo Valley submarket, which has a low 2.5% vacancy rate for industrial product and 14.5% office vacancy rate. DuRoss notes that the prime office markets in the Conejo Valley include Westlake Village and Calabasas, while Thousand Oaks is considered the “main and main” for industrial product. “We thought that more of a true industrial type of user would be more enamored with this building and that we would see a greater demand in general if we focused on industrial,” he says. “This building is right in the industrial heart of the Conejo Valley.”