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LA County signs office lease in Long Beach worth $167M
Neil Kadisha’s Omninet Capital inks deal with government tenant for 15-year term
The County of Los Angeles has inked a deal for 207,300 square feet of offices in Long Beach with a 15-year lease valued at nearly $167 million.
The county’s Department of Social Services will occupy the offices at 1500 Hughes Way, in Lincoln Village west of the 405 and 710 freeway interchange, the Commercial Observer reported.
Beverly Hills-based Omninet Capital, led by Neil Kadisha, bought the 513,500-square-foot building in 2012 for $69 million. Tenants include the state Department of Industrial Relations, Children’s Institute and the Long Beach Housing Authority, according to their websites.
Omninet leased the offices for an estimated maximum first-year cost of more than $7.2 million, with a one-time rent concession of $249,461, according to the Observer.
The estimated lease cost, including tenant improvements, is $166.7 million over the 15-year term.
Long Beach is among the more affordable office markets in Los Angeles County, with an average rental rate of $2.67 per square foot per month, well below the county average of $3.86 per square foot, according to the Observer.
The city’s availability rate for offices that are vacant, soon to be vacant or available for sublease, is nearly 26 percent, according to a Savills report. Leasing activity was down 3 million square feet in the third quarter compared with the previous period.
The county’s lease was the second largest of the year for the entire region, according to an analysis by The Real Deal.
Billionaire Kadisha is a member of L.A.’s prominent Nazarian family through his wife, Dora Nazarian.
He is CEO of Omninet — which he founded with his father-in-law — a company that has moved from telecommunications investments into major commercial developments, particularly in Las Vegas. Its holdings as of 2020 included 13,000 rentals across the country.That year, Kadisha sued his neighbor in Beverly Hills for $2 million, alleging the neighbor’s new pool, hot tub, deck and manicured lawn encroached onto his vacant property on Crest View Drive.
— Dana Bartholomew
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