Anthem lists 26-acre plot of land in Warner Center

More than 5M sf can be developed on the site: brokers

Jun.June 21, 2017 06:00 PM
21555 Oxnard Street (Google Maps)

Anthem Blue Cross of California, a subsidiary of healthcare giant Anthem Inc., is listing a massive plot of land that surrounds its office building at 21555 Oxnard Street in Warner Center.

The 14-story office tower where Anthem has its offices is not included in the sale. It sits on a separate parcel owned by an entity dubbed TA/Warner Center Investors, which is linked to film producer Avi Lerner, property records show.

The asking price for the 25.6-acre parking lot, where five parcels currently stand, is unknown. Savills Studley has the listing but did not return a request for comment.

Sources told The Real Deal that Anthem’s decision to leave or remain on the property could impact buyer interest. For example, one potential buyer may pay top dollar if Anthem remains a tenant while another may see it as a better deal if they decide to leave.

As part of the sale, Anthem will leaseback the parking lot, paying operating expenses and taxes, through mid to late 2019, according to marketing materials obtained by TRD. The buyer will have to provide a minimum of 1,300 parking spaces to the office tower at 21555 Oxnard Street.

It’s unclear whether Anthem will decide to renegotiate its lease at the building, which sits in the center of the doughnut-shaped parking lot, after 2019.

Thanks to the zoning guidelines in the Warner Center 2035 master plan, a buyer would be able develop more than 5.5 million square feet of office, residential, retail or hospitality buildings on the site, according to the marketing materials.

Warner Center is mostly comprised of office buildings and parking lots with pockets of apartments and malls. The city adopted the plan in 2013 to make it feel more like a city, the Los Angeles Times reported.

Officials approved zoning that would allow for up to 30 million square feet of commercial space, double what existed at the time, and removed building height caps in most of the 1.5-square-mile district, which includes Anthem’s site.

A property of Anthem’s size is sure to attract attention considering the investment happening in Warner Center, which includes Westfield Promenade across the street, said David Solomon of CBRE.

“It’s clearly a prime piece of real estate,” Solomon told TRD. “It’s a big piece of land and it’s hard to imagine a use that won’t work there.”

The area is seeing a flurry of activity with landlords and investors looking to develop multi-family and mixed-use projects.

Landlord Michael Adler of Adler Realty Investments Inc. and financial partner LLJ Ventures recently announced a plan to demolish Adler’s 350,000-square-foot office park at Warner Center Corporate Park to construct a mixed-use development.

The proposed $1 billion project would include 1 million square feet of offices, 80,000 square feet of retail and restaurants, 1,000 residential units, 68 live-work units and a 228-room hotel, according to the L.A. Times.

There’s also the 47-acre site currently underway at the old Rocketdyne plant on Canoga Avenue called Uptown at Warner Center. It would include 4 million square feet of residences and 1.1 million square feet of commercial space, as well as a park and performance spaces, the Times reported.

Westfield’s $1.5 billion mixed-use Promenade development in the area was approved for 1,500 mixed-use residences, two hotels and a concert venue. Development for the project could start by 2020 and take 15 years to complete, according to the Times.

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