REDONDO BEACH, CA—Montana Avenue Capital Partners, a local developer, has purchased one of the few remaining industrial properties in Redondo Beach, CA, with plans to convert it into a creative office property. The investor purchased the 50,000-square-foot, two-building property from its original owner, Klein Family Partnership, for $9.6 million, and plans to invest another $2 million into the conversion.

“My client has bought four other properties with me in the South Bay, and I identified this as another great creative office conversion,” Steve Solomon, a managing director at JLL, tells GlobeSt.com. “The neat thing about the property is that it is two separate buildings. The back building has the old bow-truss style, and is a warehouse building with loading docks. In the South Bay, there continues to be a big demand for creative office with very few office buildings and creative conversions here. It is surrounded by the residential communities of Redondo and Manhattan Beach, and of course the 405 freeway is nearby. So, it is a great location. The property had only been owned by one other person aside from my client.” Solomon represented the buyer in the transaction, while his JLL colleagues Luke Staubitz, Harvey Beesen and Andrew Dilfer represented the seller.  

The property, which is located at 2400 Marine Avenue, was vacant at the time of the sale; however, Amazon leased 30,000 square feet of the space, including the back warehouse, during the escrow period. It plans to use the property as industrial, meaning the 20,000-square-foot back warehouse will not be converted in to creative office, and it will occupy 10,000 square feet of office space in the front building. “I have never in my career leased a vacant space while it was in escrow,” says Solomon. “The lease transaction closed the day after the close of escrow.”

Solomon is handling leasing efforts for the remaining 20,000 square feet of space, and says that the owners are open to a single tenant or a tenant mix. Solomon has already gotten some interest from nearby studios and production companies, and will likely lease to a studio or another type of creative user. Renovations will be completed in the next three to six months. Once finished, the property will include exposed ceilings, glass roll-up doors, skylights, indoor/outdoor collaborative workspace and wrap-around patio spaces and EV charging stations.

Although industrial conversion to creative office is popular, as Solomon mentioned, there isn't a lot of product available in the Redondo Beach market. However, Culver City's Hayden Tract has been a popular spot for creative office conversions, thanks to its healthy stock of dated industrial buildings, and high demand from entertainment and tech companies.