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Why You Should Consider Investment Real Estate in the Smoky Hollow District, El Segundo

Written by Posted On Friday, 28 September 2018 11:32

As the Smoky Hollow district in El Segundo begins its transformation, the city is welcoming creative and tech industries into the district. The area is heading toward a revitalization that will bring new investment real estate opportunities to clever investors.

Smoky Hollow District Transformation

The Smoky Hollow district in El Segundo was once a thriving industrial area. Located next to the Chevron refinery, the 120-acre area is filled with industrial buildings that once housed manufacturing businesses.

The name “Smoky Hollow” actually came about because of the heavy industrial steam that used to hang over the area. However, the need for manufacturing space dwindled after the Cold War ended and the aerospace defense industry shriveled. In the early 2000s, creative and tech companies slowly started creeping into the area. Now, to keep the area relevant and in demand, El Segundo city officials have decided to take matters into their own hands. They plan to initiate a redesign of the space that welcomes and encourages those creative and tech companies to set up shop.

The Smoky Hollow plan from city officials involves redefining what can be built in the space. Through 2040, city officials plan to develop 2.97 million square feet of office space and public facility space for new tenants. To draw in the creative and tech types, the city plans to also build space for small cafes and eateries. New parking spaces to accommodate locals and tenants are also being built in the area between the Smoky Hollow West and Smoky Hollow East planning zones.  

Creative and Tech Industries Moving In

As more and more creative and tech industries find themselves in Los Angeles, the need for industrial office space has risen. Trendy creative and tech businesses are interested in industrial architecture and spaces. Several companies have already moved into the Smoky Hollow district because the area offers more affordable lease rates compared to neighboring areas such as Santa Monica, Venice, and West Los Angeles.

The area is well on its way. The creative and tech companies that have already moved in have completely remodeled the industrial buildings into unique, colorful, and artistic industrial office spaces. As the area transforms, investors should consider their options early.

What Does This Mean for Investors?

Savvy investors should take note of the changing area and its potential to grow. With popular and profitable diverse industries coming together in one place, Smoky Hollow seems poised to grow. Commercial real estate in the area will see increases in purchasing costs as well as in the cost to lease office space. Investors who make a move on property now have the opportunity to cash in as the value increases beyond current market value.

El Segundo itself already has a thriving real estate market space with home values rising 7.5% in the past year and the median home price is at $1,099,000. El Segundo has a small town feel, but has experienced strong economic growth in several areas. Despite the diminished aerospace industry, many aerospace companies still call El Segundo home. As creative and tech industries set up shop in the area, economic growth will continue to rise. The strong public school system (top 5% in high schools nationally) has helped attract many middle to upper-middle class families.

Investors who are looking to increase or restructure their investment real estate portfolios may want to consider purchasing Smoky Hollow commercial real estate properties. The area is poised to continue to grow and purchasing property now before the revitalization takes place is a strong move for many investors. There is a strong potential for lucrative investment returns.

How Can You Take Advantage of This Change?

Reviewing your own commercial real estate investment portfolio with a Lyon Stahl agent can help you take advantage of the Smoky Hollow revitalization by determining what actions make the most sense for you. Each investment portfolio is different and should be assessed on an individual level taking into consideration your investment goals and current investment earnings.

For more information on the changes being made in the Smoky Hollow district as well as the changes taking place in the El Segundo real estate market, contact us directly at 310-425-9838. Lyon Stahl specializes in investment real estate.

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