98.3 F
San Fernando
Wednesday, Apr 30, 2025
Home Blog Page 18

CCI Focuses on Senior Housing

Danielle Hastie runs CCI in Westlake Village.

Westlake Village-based California Commercial Investment Group was founded in 1995 by Lou Mellman and Garry Collett, originally as a local development company until it eventually began to explore the affordable housing industry.

Today, CCI operates as a full-service acquisition, property management and development firm – overseeing more than 7,500 multifamily units across 35 states.

“Real estate has all these different kinds of asset classes,” Danielle Hastie says. “For us, real estate is housing. Housing is a very special type of real estate.”

Hastie is the niece of Mellman and current chief executive of CCI – a role she took over in May of last year after originally joining the company in 2004 and working her way up the corporate ladder. She has plans to put her own flair on the company to ensure its legacy, including an upcoming rebrand.

While CCI’s $1 billion portfolio spans a variety of asset classes – including hotel, industrial, multifamily, self-storage, retail and office – Hastie has a soft spot for senior housing, which is the firm’s focus.

“We understand the population and the way that we manage (senior housing) buildings, it naturally progressed such that it became a focus,” Hastie says. “And as we’ve gotten more senior buildings, we’ve built more infrastructure around senior buildings.”

Senior Housing Emphasis

Recognizing the lack of supply of senior housing facilities coupled with America’s aging population, CCI aims to bridge that gap, all while catering to individualistic needs.

“Managing senior housing is specific,” Hastie says. “When it comes to management of properties, whether it’s senior housing or market rate housing, we have to understand our customer in order to provide excellent service. Our seniors have different needs.”

CCI’s properties average 100 units, mostly made up of one-bedroom apartments. While the company owns multiple types of senior facilities, it specializes in low-income senior housing – the majority of which are independent living facilities.

“I think the biggest obstacle for a senior, especially if you’re alone, is isolation and loneliness,” Bryan Lewitt, a managing director at Jones Lang LaSalle Inc. specializing in health care, says. “Some people can afford to age in place, but it’s not fun. It (can be) very lonely and isolating. If their spouse is gone, or even if their spouse isn’t gone, maybe they want the camaraderie of the past when they were around a lot of people.”

As opposed to assisted living or even more hands-on memory care facilities, independent living is best suited for seniors in relatively good health wanting a maintenance-free lifestyle and access to social activities and on-site amenities, according to The National Council on Aging.

“The longer we can keep people in independent living, the better for everyone,” Hastie says. “Better for them, better for the government, better for society.”

Livelle Mulholland

And while CCI does primarily low-income senior housing, a new development underway represents the company’s tap into the world of luxury senior living.

Livelle Mulholland, as it’s called, will be a 479,000-square-foot, 300-unit luxury living campus in Woodland Hills for seniors aged 60 and up – CCI’s biggest and most ambitious project yet.

“This seems like the next step in senior housing,” Hastie says. “It’s going to be a life plan community. It’s a little bit of a different model.”

A rendering of Livelle Mulholland in Woodland Hills.

As opposed to a singular structure, the complex, named as an ode to living well, will encompass all three types of senior housing classes – independent living, assisted living and memory care – plus feature an abundance of amenities, including in-home health care and on-site medical suites – fostering hospitality lure.

It will feature three boutique restaurants, a resort-style pool, walking trails, gardening areas, a wine bar, classrooms, a fitness center, yoga studio, various entertainment areas, a theater, a dog park and outdoor game courts.

“The amenity package of this building is going to be crazy,” Hastie says. “We call it cruise-ship living.”

CCI purchased the 19-acre site for redevelopment in December for $30 million. Located adjacent to the Motion Picture and Television Fund campus, it had long been used as a farm to grow organic fruits and vegetables.

“I think the action is in the luxury,” Lewitt says. “If you look at the existing product right now and then also what’s in the pipeline in the San Fernando Valley and the Westside, the action is in the high-end because that’s where people can afford to sell their homes at good prices, and they can transfer to these independent living facilities seamlessly.”

Lewitt represented the seller, Motion Picture and Television Fund, in the December hand off. Construction is scheduled to begin in the first quarter of 2026 and is expected to open by the third quarter of 2028. Entry fees will start at $590,000.

“The entire San Fernando Valley is about 2 million residents, all for the most part, families, bedroom communities, suburban,” Adam Peterson, a first vice president at CBRE Group Inc. specializing in senior housing, says. “The demographic over there is almost perfect for senior housing.”

Other nearby luxury senior living communities include The Variel at Warner Center, MonteCedro Altadena and Belmont Village in Westwood.

“This would be a flagship,” Hastie says, referring to the new Livelle brand. “And, if it takes off and is as successful as we hope it will be, (there may) be other Livelles out there. It felt like a natural next step.”

But despite being based in Westlake Village, Livelle Mulholland is one of only two properties CCI currently owns in the Valley. The other is Fickett Towers in Van Nuys, a 12-story, 200-unit complex for low-income elderly individuals.

Livelle Mulholland in Woodland Hills.

Hastie says Los Angeles is a tough market to transact in due to rent control and other laws affecting landlords. Instead, CCI has found greater opportunities in other pockets of the U.S., such as North Carolina, Minnesota and South Dakota.

Due to the company’s tendency to buy and hold properties, Hastie says CCI is relatively conservative when it comes to its acquisition criteria, always looking at opportunities with a long-term lens in mind.

“We have been on the sidelines for a little while because real estate transactions don’t make a lot of sense to us right now,” Hastie says. “But things happen for a reason that have really allowed us to look internally so we can set ourselves up in the best way possible so that we’re ready to start acquiring as things change.”

Internal refocus

Not being aggressive with real estate recently has allowed Hastie and her team to refocus its internal awareness, which has translated into a company-wide rebrand that just launched.

“We’ve taken a hard look at everything we do,” Hastie says. “Every process we do internally and, to make it better, we want to make sure we’re utilizing the right technology tools. We want to make sure we have the right resources for our teammates. We want to make sure that, for our investors, that we have better reporting tools for them. We haven’t had an investor portal yet. We’ve really looked inside for the past year and part of that was bringing a rebrand to life.”

CCI is reimagining all its processes – from smaller modernization efforts such as changing the name to now just be CCI, modernizing its logo and launching a new website – to bigger initiatives such as initiating a new operational arm.

“The goal is to get out there and also do third-party management,” Hastie says. “We feel like we do such a good job in-house. We manage our own buildings because we can keep our finger on the pulse of that building a little bit better. But we know there are a lot of owners out there that need that service, and we can provide it. It’s something that we’ve always closed our doors to, but we’re about to start.”

Despite the gamble senior housing may pose from an operational risk standpoint, experts believe that, due to supply and demand measures, if you’re a multifamily developer, now is a good time to be honing in on senior housing.

The Baby Boomer Generation is the second largest demographic cohort making up 20.9% of the U.S. population, directly behind Millennials who make up 21.7%, according to Statista. By 2030, all Baby Boomers will be age 65 or older.

“The silver tsunami has not yet hit for senior housing,” Lewitt says. “People are living longer and living better.”

And as leadership has shifted lands and the company continues to grow and take on more senior housing facilities, Hastie wants to be sure CCI evolves well into the future.

“Gary and Lou have been the leaders of the company for a long time. And when they first envisioned the company, California Commercial, (they envisioned that) we’re going to be in the entire state of California. And now we are from Hawaii to Rhode Island to North Dakota all the way to Texas,” Hastie says. “We really span the entire country and want to make sure we’re setting ourselves up in a way that makes sense for the future.”

Olympics Plan Valley Debut

The 2028 Summer Olympics are coming to Los Angeles, with three events being held in the San Fernando Valley including archery, BMX racing and skateboarding. Here Sonya Kay Blake of the Valley Economic Alliance and Nancy Hoffman Vanyek of the SFV Chamber of Commerce pose with an archery target in the Woodley Park Archery Range in the Sepulveda Basin in Encino. (Photo by David Sprague)


It’s a setting you’ve frequently seen on the big and small screen.

In “E.T. the Extra-Terrestrial” and “The Sandlot,” it was home to rambunctious and lovable children getting into a variety of misadventures. You could watch Ritchie Valens come of age in “La Bamba.”

In the 1990s, kids enjoyed “Mighty Morphin Power Rangers” at home. More recently, audiences experienced “Barry,” with the titular character combining acting and hitman work at his new home.

And in 2028, the Summer Olympics and Paralympics will bring the San Fernando Valley to a global audience as it plays host to a handful of sporting events and spectators visiting from all over the world.

“It definitely puts the Valley on the global stage. It’s going to highlight it,” says Nancy Hoffman Vanyek, chief executive of the Greater San Fernando Valley Chamber of Commerce. “We have tourism. We have the studios. We have the museums. We have the Six Flags Magic Mountain adjacent to us. I think it really makes a great stage for what this giant suburb in the city of Los Angeles has to offer.”

Third time’s the charm

It will of course be Los Angeles’ third Olympic Games. This time, those games will be more spread out.

For the San Fernando Valley – and in keeping with the LA28 Committee’s desire to utilize existing facilities in lieu of new construction – that puts the Sepulveda Basin Recreation Area on the board.

“We’re not building anything like they did in past Olympics,” says Vanyek, “but we’re very fortunate that the Sepulveda Basin Recreation Area already has so many great pieces.”

The area – which is the second largest urban park here the city of L.A. – will host archery, skateboarding and both BMX freestyle and racing.

“These three sports are so iconic for the Valley,” says Sonya Kay Blake, president and chief executive of the Valley Economic Alliance. “It’ll be a great opportunity for us to feature the Valley and talk about it.”

This represents a homecoming of sorts for Olympic-level skateboarding and BMX biking – both culturally took off locally. What’s more, BMX bikes were once manufactured here.

“BMX and skateboarding were such big things in my teenage years and lot of those BMX manufacturers started off in the San Fernando Valley, so it’s really cool to bring this back home,” Vanyek says.

A skateboarder rides around Pedlow Skate Park in the Sepulveda Basin Recreation Area. (Photo by David Sprague)

The games are projected to have up to $11 billion in economic impact to the Greater Los Angeles area and create 79,000 jobs. While it isn’t yet clear how much of that could be concentrated in the Valley – the rest of Los Angeles along with Inglewood, Carson and Long Beach will host many events – it ought to be a sizable impact of real dollars and earned media.

“It should be a great boon for our tourism industry. We’re really excited about the potential impact there,” Blake says. “We’re excited about how the Valley is a part of this. Clearly, LA28 has been very intentional and mindful of benefiting all areas of the city and county.”

The prospect of a no-build Olympics helped secure L.A. the 2028 bid. In addition to the plethora of historic venues here – many of which hosted the 1984 Games – several more have come online in recent years. Some events will also be hosted as far away as Temecula and Oklahoma City.

On top of that, the athletes themselves will need places to train and practice once they’re here. This has the potential to put universities and community colleges in play for participating in the games.

“We are fortunate to have these amazing facilities that support our athletic teams and can certainly understand the interest in them,” says Los Angeles Valley College President Barry Gribbons, who adds that many teams have expressed interest in the college’s facilities. “There are quite a few issues that would have to be worked through for the facilities to be used by Olympic teams. That said, it’s important to us that we ensure that our facilities benefit the community whenever possible.”

Stephen Chueng, president and chief executive of the Los Angeles County Economic Development Corp., notes that the 88 cities and more than 100 unincorporated communities in the county have ample “world-class facilities” to accommodate the games.

“The Valley did not host any events in the ’84 Olympic Games and it is wonderful that we get to showcase the Valley to the world,” he adds. “By hosting events like skateboarding at the Sepulveda Basin Recreation Facilities, we get to reduce the cost of hosting the games while bringing visitors from around the world to the Valley.”

Making the most of the events

Economic stakeholders of course have their sights on providing a memorable, efficient Olympics – think more of this past Paris 2024 Games and less the Winter Games in Sochi, Russia, in 2014, the most expensive to date and marred by construction issues.

Depending on how some facets of the games are executed, it could leave a lasting impact on the region – the Valley included. This would come in the form of boosting the local businesses here – Chueng estimates about 100,000 contracts will be issued for Olympics prep work – and establishing an infrastructure for the future.

“This also could provide enormous economic opportunities for local companies as attendees of the events will likely want to remain in the Valley before and after the events for dining and entertainment,” Chueng said. “As the host, we need to develop a comprehensive guide for visitors to know where to eat, drink and play (and how to get to and from the venue) while they are in the Valley.”

‘Car-free’ games

L.A. Mayor Karen Bass has declared the 2028 Games will be “car-free.” This means public transit will become a key factor for spectators.

In the Valley, this will manifest in tweaks to surface road bus routes and the G Line rapid transit bus. As the Los Angeles County Metropolitan Transportation Authority specs out the Sepulveda Transit Corridor project and the East San Fernando Valley Light Rail Transit project, it’s likely they’ll be informed by how the existing transit infrastructure performs in 2028.

Blake is hopeful the games will provoke local residents to at least reconsider their travel habits, if not change them.

“Only 4% of our residents are using public transportation to get to work,” she says. “I think the Olympics can really help people be encouraged to take public transportation to work when those lines are completed. Hopefully we’ll have changed peoples’ habits enough afterward.”

Chueng agrees.

“If we can leverage the games to increase and improve public transportation access to the Valley, this could change long-term behaviors of Angelenos and (hopefully) increase the usage of public transportation in the future (and therefore, reduce traffic congestion),” he says.

Carlos Gonzalez of Woodley Park Archers practices in the Woodley Park Archery Range in the Sepulveda Basin Recreation Area. (Photo by David Sprague)

Using experience and examples

Chueng attended the Paris Olympics and brought back with him fresh perspective on how those hosts prepared for the event – organized street closures along with providing public transit; installing signage in multiple languages and placing staff ambassadors around; ensuring adequate access to restrooms, waste bins and water stations; and staffing a police presence to “espouse a sense of security without intimidating the visitors.”

“L.A. needs to carefully think through how to replicate some of those best practices and expand the reach to the vast regions throughout Southern California where the games will be held,” Chueng says.

And Angelenos will have a fairly fresh memory of other major sporting events hosted here – including the FIFA World Cup in 2026 and Super Bowls in both 2022 and 2027. With L.A.’s growing identity as a global sports center, how it performs in 2028 may open more doors in the future.

“If local companies in the Valley are able to contract with the Olympic Games, this will allow them to be competitive in the future to bid for other major events,” Chueng says.

Another factor will be heat-mitigation: portions of the Valley easily reach triple-digit temperatures during the height of summer, presenting a health hazard to competitors and spectators alike.

“It’s likely that the event organizers and the City of Los Angeles will be looking into measures to ensure the safety and comfort of both athletes and spectators,” Hoffman says. “These could include scheduling events during cooler parts of the day, providing ample shade and hydration stations, and possibly implementing cooling technologies.”

And given that small businesses make up 94% of all the companies in L.A., the impact to those entrepreneurs can be life changing. With the labor disruptions of the past few years, Blake says, a boost like this can save many of those companies – if officials put them in a position to succeed.

“One of the concerns with the Olympics is, how can we really crack the code to make sure that it’s a very inclusive type of economic prosperity? How are we able to leverage the event to transform the underserved portions of our community?” she says. “One of the concerns is that this opportunity would come and go and we wouldn’t see any significant change to the way our economy is growing.”

Airport Businesses Worry Over Future

Penny Adelson, owner of Vista Aviation and of a flight school at Whiteman Airport in Pacoima. (Photo by David Sprague)

For Penny Alderson, Whiteman Airport in Pacoima has been the lifeblood for three businesses she co-owns and operates that have been around for decades: an avionics installation firm, a flight school and a hangar-leasing company.

Together, these businesses employ more than 15 people and pull in tens of millions of dollars a year in revenue.

But in recent years, that lifeblood has come under increasing threat as pressure has steadily mounted to close the nearly 80-year-old Whiteman Airport, one of the last general aviation airfields to remain in the San Fernando Valley.

“If the airport were to close, it would be the end of the road for my businesses,” Alderson says.

Pacoima Beautiful, a neighborhood activist and environmental group, has been leading the charge to shut down the county-owned airport, citing pollution and noise concerns, as well as a string of plane crashes a few years back. The group’s drive has gained increasing support from local elected officials and others – to the point that this past spring the County Board of Supervisors voted to commission a report from county staff exploring non-airport options for the parcel.

What’s more, earlier this summer, County Supervisor Lindsey Horvath, whose district includes Whiteman Airport, announced that the county would no longer apply for – or accept – federal funds to maintain or upgrade the airport. Such funds usually come with strings attached, including a binding obligation to keep the airport open for 20 years.

As of now, no official action has been taken to close the airport, which sits on 184 acres of land in the Pacoima neighborhood. And even if such a decision is ultimately taken, closure would take years – perhaps more than a decade.

General aviation airports shutting down

Yet, Alderson and owners of more than two dozen other businesses that rely on the airport have reason to be concerned. They look around and see that since 2000, scores of general aviation airports have shut down across the nation, including at least eight in California, according to a 2017 report from the California Department of Transportation.

More recently, in response to similar pressures, Santa Monica, after reaching an agreement in 2017 with the Federal Aviation Administration, is proceeding with the closure of its municipal airport, now slated for December 2028.

“The level of concern about the airport closure is very high,” Alderson says.

Not only do other general aviation airport closures signal that Whiteman Airport could close, but they also put more pressure on the remaining airports, according to Jim Miller, a former administrator of Whiteman Airport who now heads a U.S. Air Force Civil Air Patrol cadet squadron that uses the airfield.

“Santa Monica (Airport) is closing in five years and some of those aircraft are going to come over to Whiteman,” Miller says. “They can’t even get into Van Nuys at the moment.”

With such a tight market for general aviation aircraft space, Miller wonders what will happen to the 600 aircraft that now tie down at Whiteman should the airport close.

“Even if you could get into an airport, the rents for tie-downs are almost certain to skyrocket,” Miller says.

Alderson says she has a similar concern about her businesses, especially the flight school and the avionics installation company, which is called Vista Aviation.

“Each airfield has one or two preferred vendors for installation of avionics equipment,” Alderson says. “And all the other airports around here already have their preferred vendors. So, the question becomes where would we move to?”

Alderson isn’t the only concerned business owner.

Art Cueva owns Able Air Corp., a general aviation aircraft maintenance company founded in 1975 that he says is the oldest business still at Whiteman.

Cueva says that if a decision is made to shut down Whiteman, he wants to know whether the county would help him try to relocate his business.

“Right now, there are no openings for additional aircraft maintenance companies at other general aviation airports in the area – at least as far as I’ve checked,” he says.

Art Cueva owns Able Air Corp., a general aviation aircraft maintenance company at Whiteman Airport in Pacoima. (Photo by David Sprague)

Nonprofits worried, too

Concern about the impact of the potential closure of Whiteman has also spread to the nonprofit sector, including Miller and his Civil Air Patrol squadron. The Civil Air Patrol’s services include search and rescue operations, education programs for the public on aviation issues and leadership skill development programs for teenagers.

“If the airport were to close, we would then have to start looking for another location to meet and use as a training center,” Miller says.

Just as with their commercial business counterparts, getting space at other airports would likely prove difficult, since most other general aviation airports have their own squadrons.

Miller says the other general aviation airports in the region – in Camarillo, Lancaster and in the San Gabriel Valley – are too far away to consider as new locations for the squadron, especially given commute times.

Trying to prevent the airport’s closure

Pacoima Beautiful, the group leading the effort to close Whiteman Airport, declined to comment on the impact that closing the airport would have on these businesses and nonprofits.

The group does have a web page dedicated to its campaign to shut down the airport. On that web page, the group notes that there have been three crashes involving planes flying into or out of Whiteman Airport since 2020 and that two of those crashes resulted in fatalities.

There’s also an environmental justice component to Pacoima Beautiful’s campaign as the group notes that the noise and pollution stemming from the airport primarily impacts the adjacent low-income and minority community.

Pacoima Beautiful has also held numerous neighborhood rallies to put pressure on local elected officials to shut down the airport.

On the pollution front, there may be some progress. Ever since the airport opened in 1946, aircraft have been using leaded fuel. But since June 1, unleaded fuel has been available at Whiteman, part of a broader effort for all five county-owned airports to switch to unleaded fuel.

A plane takes off at Whiteman Airport in Pacoima. (Photo by David Sprague)

Meanwhile, Alderson and the other businesses at Whiteman are trying to get the word out about the economic benefits of keeping Whiteman Airport open. And they have enlisted the help of advocacy organizations like the Valley Industry and Commerce Association.

VICA sought to gather support from the broader San Fernando Valley business community to show up at the county Board of Supervisors meeting in April when the motion to study alternate uses for the property was being considered.

“This will have a devastating financial fallout on existing property contracts, dire impacts on airport businesses, ripple effects on the broader airport system’s finances, and the unsettling appraisal of the land’s fair market value,” VICA said in its plea to the Valley’s business community to show support for the airport at the meeting.

Despite VICA’s efforts, the Board of Supervisors went ahead and approved the motion to study alternatives to airport use.

Once that study is in, the next move will be up to the supervisors.

While Alderson is concerned about the fate of her businesses, she also notes the larger stakes if Whiteman Airport were to join the list of general aviation airport closures.

“If all the general aviation airports close, there would be a tremendous impact on the infrastructure of the country,” she says. “General aviation training centers are the main pipeline for training of commercial air pilots and even future military pilots.”

Minimal Co. Bets on A Simpler Cell Phone

Founders Armen Youssefian and Andre Youkhna started The Minimal Co. last year. (Photo by Rich Schmitt)

Andre Youkhna had a problem.

After spending hours doomscrolling through social media posts, photos and videos, Youkhna often had trouble falling asleep until 4:30 in the morning. He tried using a feature phone, the classic flip phone used before the smartphone came into existence. While the constant social media scrolling stopped, there were still some limitations – namely, not being able to access bank accounts, email clients quickly, unlock a Tesla (which uses a smartphone as a key) or use two-step verification for certain accounts.

In 2023, Youkhna cofounded The Minimal Co. in Glendale with his cousin, Armen Youssefian, to address this problem. The pair aimed to make a phone that kept up with the hyperconnected life of everyday Americans without enabling them to feed their worst vices.

“I kind of had to have a happy medium between having a really dumb phone and a very smart phone,” Youkhna says.

How it works

The Minimal Phone – the company’s version of “a happy medium” – looks like something between a Blackberry and a Kindle. The phone is compatible with service providers like AT&T, Verizon and T-Mobile, runs on a standard 4000mAh battery and operates on full Android, which means users can download any app from the Play Store. The phone also comes with a camera.

The Minimal Phone’s key differentiator from standard smartphones is its e-ink display. E-ink displays, which are popular on e-readers, reduce eye strain and conserve more battery than standard digital screens. The downside is its low refresh rate – watching videos on e-ink chunks up each frame, diminishes video quality and washes out color with its black-and-white display. While you can access TikTok and Instagram, Youkhna and Youssefian say, you wouldn’t necessarily want to.

“We’re trying to get away from people using their phone for media consumption and just wasting a lot of time,” Youssefian says.

The phone also features a QWERTY keyboard, which makes up for delays in the e-ink display. Instead of typing on the screen itself and waiting for each letter to render, users can use the physical keyboard.

The rise of the feature phone

Feature phones, also called “dumbphones” (“I don’t like to use that word, but that’s what they call it,” Youkhna says,) are making a comeback. The Light Phone, a New York-based startup, raised $12.45 million in a handful of crowdfunding and seed funding rounds between 2015 and 2023. Its e-ink display phone costs $499.

There’s also Brick, a physical device that locks programmed apps and needs to be tapped to unlock them. (The idea is to keep your Brick in a physical location separate from where you need to focus.)

“There’s a lot of people in this segment where they want a dumbphone, but a dumbphone is very limiting,” Youssefian says.

Utah-based Troomi uses the “dumbphone” model for children by allowing parents to block any apps or content from children’s phones while still allowing them to access maps and communication features. Texas-based Techless has a dumbphone that costs $399 and comes with subscription tiers, which allows users to access certain apps based on their specific needs.

“I could imagine feature phones becoming more profitable if there is a way to generate recurring revenue from the hardware, like a smaller-scale version of the installment payment plans Apple introduced to the market years ago,” says Jared Brenner, counsel to tech firms at Sherman Oaks-based Stubbs, Alderton and Markiles LLP. “However, venture capital funds generally rely on outsized returns and mass adoption of software, and their needs seem incongruous with the concept of a dumbphone.”

The investment problem

Despite all the companies popping up to create some version of a feature phone, venture funding in the space has been sparse. A sizable number of investments in feature phones are taking place on crowdfunding platforms. The Minimal Co. raised $719,000 from over 1,000 backers on Indiegogo.

“It is about scalability and the recurrence of revenue,” Brenner says. “The average smartphone user is an exponentially more profitable customer for a venture-backed software business because it’s almost impossible to generate advertising impressions or collect usable behavioral data from a feature phone.”

The demand for a feature phone in the U.S. is pretty small. Outside of the U.S., tech giants like Google are capitalizing on the growth of feature phones in developing areas – according to Counterpoint Research, consumers in India remain steadfast in their faithfulness to feature phones compared to smartphones. A 2023 data report from Counterpoint Research found feature phones to represent only 2% of the handset devices market in the U.S.

In 2023, Andre Youkhna cofounded The Minimal Co. in Glendale with his cousin, Armen Youssefian, to address the problem of smartphones being too much of a distraction. (Photo by Rich Schmitt)

“Although there will not be a significant spike for feature phones in the market, there are consistent needs that create the steady demand for feature phones in a smartphone-dominated market,” the report concludes.

The Minimal Co. founders have been contacted by several high-profile celebrity investors – including UFC fighter Michael Chandler, “Peaky Blinders” actor Paul Anderson and Comedy Central comedian Ronny Chieng – but aren’t looking for additional capital.

“We don’t have a lack of funds to complete the project as we speak,” Youssefian says. “We have a lot of preorders. So we’re just banking on having a great product and great reviews.”

The Minimal Phone costs anywhere from $399 to $499. (For comparison, the iPhone 15 retails at $799 on Apple’s website.) The company is developing its engineering sample and expects to ship orders in October.

Arcutis Wants to Be A Go-To Treatment

LEADER Frank Watanabe is the chief executive of Westlake Village-based Arcutis Biotherapeutics.

Frank Watanabe and his team at Westlake Village-based Arcutis Biotherapeutics Inc. are on a mission: to have the company’s main drug product become the leading non-steroidal alternative to treat a wide range of skin diseases and conditions.

For decades, the go-to treatment for these skin conditions has been steroid-based drugs, powerful inflammation fighters that also come with a range of powerful and harmful side effects if used for long periods of time. These include often intense skin irritation and weight gain.

“Our goal is to replace topical steroids, which are the bedrock today for the treatment of inflammatory skin diseases,” Watanabe says. “But steroids have problems, especially when used for longer terms. Also, they are not safe for sensitive parts of the body.”

Over the last couple of years, Arcutis has methodically moved to accomplish this mission by securing a series of approvals from the U.S. Food and Drug Administration for various applications of its non-steroidal drug, technically called roflumilast but marketed under the name Zoryve.

The first FDA approval, in July 2022, was for a high-concentration cream version of Zoryve to treat plaque psoriasis in people at least 12 years of age. Plaque psoriasis is the most common form of psoriasis, a skin disease that affects at least 9 million Americans. (Eventually, the FDA approved the use of the drug for anyone at least 6 years of age.)

Then, late last year, Arcutis received FDA approval for a topical foam version of Zoryve to treat seborrheic dermatitis, a chronic recurrent inflammatory skin disease that affects more than 10 million people in the United States. The approval covered the use of the Zoryve foam for anyone at least 9 years of age.

Most recently, in July, the FDA approved the use of Zoryve for the treatment of mild to moderate atopic dermatitis in adult and pediatric patients at least 6 years of age. Atopic dermatitis is the most common form of eczema, affecting nearly 10 million children and more than 16 million adults in the United States.

Watanabe says Arcutis is planning to seek two more FDA approvals of Zoryve: filing with the agency this year for an expanded range of applications for the foam version (now approved for seborrheic dermatitis) and then by late this year or early next year filing for a low-strength concentration of the cream for children under the age of 6.

“We’ve completed the clinical studies for all of these indications,” Watanabe says.

Competing against steroid treatments from pharma giants

Yet even if Arcutis secures these additional FDA approvals, it still faces substantial challenges in securing enough market penetration.

Right now, according to Seamus Fernandez, an analyst with Guggenheim Securities in New York, more than 80% of the products sold to treat skin conditions contain steroids. And this has been the case for decades.

“Steroidal products work pretty well, pretty quickly and they are cheap,” Fernandez says. “That makes them the general go-to products – sort of the Honda Civic for dermatologic treatments.”

Fernandez says that there have been attempts in past decades to bring to market non-steroidal alternatives, but few have been able to gain and maintain traction.

It doesn’t help matters for companies like Arcutis that big pharma companies dominate the skin condition treatment market, such as North Chicago-based AbbVie Inc., which posted 2023 revenue of $54 billion, and Basel, Switzerland-based Sandoz, which had nearly $10 billion in revenue last year. By comparison, Arcutis had about $60 million in revenue last year.

Also, Thousand Oaks-based Amgen Inc., (2023 revenue of $28 billion) has a non-steroidal drug sold in pill form under the marketing name Otezla that is used to treat symptoms caused by inflammatory autoimmune conditions such as plaque psoriasis. But, unlike Zoryve, Otezla is also used to treat non-skin conditions such as arthritis.

“It’s been pretty hard to break this market open,” Fernandez says.

Also not helping is the reluctance of insurers to cover non-steroidal treatments for skin conditions, though Fernandez says that has begun to change in the last two to three years.

“There’s still no Medicare coverage, but we are beginning to see some state Medicaid programs embrace non-steroidal alternatives,” he says.

Arcutis’ best hope, he says, is the growing realization among dermatologists and other doctors that products containing steroids have potentially damaging side effects, especially if the products are used for long periods of time to treat chronic conditions like psoriasis.

Watanabe concurs and says Arcutis is exploring entering into partnerships to educate both consumers and physicians about the advantages of non-steroidal treatments like Zoryve. The first of these partnerships was announced in late July with Kowa Pharmaceuticals America, a unit of Nagoya, Japan-based Kowa Co.

Share price has skyrocketed since year’s start

Investors have glommed onto Arcutis, particularly since the last two FDA approvals have come through.

From a 2023 year-end close at $3.23 a share, the stock zoomed up to $11 a share by mid-March before falling back to the $8 range. It has traded in that $7.50 to $11 range ever since. The share price closed at $8.49 on Aug. 16, up more than 160% since the beginning of the year.

Valley Office Assets See Positive Signs

Skyline: The Warner Center in Woodland Hills. (Photo by David Sprague)

As employers figure out their in-office versus remote work schedules, and as the general demand for office space has dwindled, some companies are being lured to Los Angeles’ quiet upstairs neighbor – the Valley.

Despite overall office market struggles, the San Fernando Valley, Tri-Cities and Ventura submarkets are all faring quite well – outperforming the overall Los Angeles County vacancy rate of 24% – according to CBRE, which recently released its second quarter Greater Los Angeles office figures.

Ventura County, for example, had one of the lowest vacancy rates in the area, ending the quarter at 17.2%.

“Downtown Los Angeles is historically known to have generally a higher vacancy,” Natalie Bazarevitsch, a senior vice president at CBRE Group Inc. specializing in office properties, says. “And the suburbs, which are smaller markets, can absorb and also have a diversity of tenant base.”

According to the survey, vacancies have swelled in the downtown and central business district submarkets while the suburbs have performed slightly better given the more relaxed adoption of hybrid work.

And not only does the Valley have one of the lowest vacancy rates as a whole, but it also has one of the lowest class A asking rates.

This has resulted in a number of companies fleeing to the suburbs whereas landlords in the urban core continue to grapple with oversupply.

Mutually beneficial

With many employers still wanting to maintain an office presence, some are rethinking their physical footprint, assuming convenience plays a big role in enticing employees to come back into the office.

“The voice of the employee has been pretty strong, as evidenced by the work from home or hybrid models that we’ve experienced, but we are starting to see that pendulum shift a little bit with power being a little more firmly held by the employer,” Bazarevitsch says.

From an employer’s standpoint, suburban office markets typically offer lower lease rates, greater access to labor, more easily accessible office buildings, as well as that usually feature a greater parking ratio.

For companies that have their downtown offices sitting half empty, reevaluating their location may be most economical.

But the suburbanization happening in the office sector can be very beneficial to employees too – oftentimes cutting commutes and making the in-office experience more tangible for those considering the pros versus cons.

“It’s actually a meritorious relationship between employer and employee,” Bazarevitsch says. “Right now, a lot of the employees actually are grateful to be moving out of some of the more dense, urban locations where, if they have to pay for their own parking, it’s very expensive or off-site so they have to walk a lot and (it poses) a safety issue. Homelessness has remained a constant. There’s a lot of mutual benefit in this move for the employer and the employee.”

Woodland Hills is the largest office submarket in the Valley, featuring an 18.2% overall vacancy rate. Valencia and Encino follow with 28.1% and 18.9% vacancy rates respectively. Panorama City is the smallest office submarket, boasting only a 1.7% overall vacancy rate, according to CBRE data.

Buzzworthy: Santa Clarita Project Wraps

An industrial park in Santa Clarita.

Trammell Crow Co. and Clarion Partners have wrapped construction on the 1.7 million-square-foot Center at Needham Ranch in Santa Clarita.

The property is an 11-building industrial park which has been under construction since 2017. It has been fully leased since last year; tenants include DrinkPAK, LA North Studios, Illumination Dynamics and US AutoForce.

The project was built in partnership with the City of Santa Clarita. Oltmans Construction Co., which has an office in Thousand Oaks, served as the general contractor for the project. HPA Inc. was its architect and Alliance Land Planning & Engineering was its civil engineer.

“The Center at Needham Ranch has been an incredible project to be a part of and our local TCC team has valued our partnership with the City of Santa Clarita, which has been an avid supporter of the development since we broke ground seven years ago,” Philip Tsui, senior vice president for TCC, said in a statement.

“Needham Ranch has filled the demand for modern, Class A logistics space in the Santa Clarita Valley, and more specifically in the L.A. North industrial submarket, which continues to see demand from industrial users because of the area’s deep and talented labor pool and the overall quality of life in the Valley. We are excited to officially close this chapter and look forward to the next development opportunity in this market,” he added.

Hannah Welk

New CEO For Latigo

Thousand Oaks-based Latigo Biotherapeutics Inc. has named veteran pharmaceutical industry executive Nima Farzan as its new chief executive.

Farzan replaces interim chief executive Desmond Padhi, who is also an operating partner of major funder Westlake Village BioPartners. Padhi is returning full time to the private equity firm.

Latigo was originally founded in 2020 as a biotech firm focused on developing non-opioid pain medicines. It emerged from stealth mode in February with an announcement of $135 million in funding, led by Westlake Village BioPartners.

CEO: Nima Farzan

Farzan brings more than two decades of leadership experience in the biopharmaceutical industry, including most recently as chief executive of Kinnate Biopharma of San Francisco. He led Kinnate’s through an IPO that raised $270 million and then through its sale to Emeryville-based biotech firm Xoma Corp. in April for $120 million. Prior to his stint at Kinnate, Farzan served as chief executive of Redwood City-based vaccine company PaxVax. Before that, he held executive posts at Basel, Switzerland-based pharma giant Novartis.

“(Farzan’s) extensive industry leadership and clinical development experience will propel us toward our goal of becoming a world leader in discovering and developing non-opioid pain medicines,” Nancy Stagliano, Latigo’s board chair, said in a statement.

Farzan said he welcomes this next challenge.

“With our cutting-edge approach to pain management, I am confident in our ability to drive significant advancements in the field and enhance patient care where new, safer options are needed,” he said.

Howard Fine

Pizzeria Expands in the Valley

A new pizzeria opened in Burbank in August.

Slice House by Tony Gemignani, owned and operated by franchiser Vinny Margott, is located at 108 E. Palm Ave.

The restaurant has New York, Sicilian, Grandma and Detroit-style pizzas, as well as other dishes. Its drink menu includes local craft beers and premium wines in addition to a selection of sodas.

Margott also owns Slice House locations in Simi Valley and Thousand Oaks.

“It’s an honor to further expand our footprint in Southern California, especially in the vibrant city of Burbank, and I look forward to welcoming the local community through the doors to experience our artisan pizzas, fresh pastas, and other Italian staples,” Gemignani said in a statement.

“We are confident Slice House Burbank will become a staple for the community,” Margott added in a statement.

Rendering: Slice House is a franchised pizzeria.

Originally opened in San Francisco’s Italian neighborhood of North Beach in 2010, Slice House has since expanded to include 13 restaurants, all in California and Nevada, with Slice House in Burbank as its 14th location. It is developing other locations in the Valley region as well.

Mark R. Madler

Neutraderm Makes $21 Million Buy

Neutraderm Inc., a medical-grade skin care manufacturer, purchased 20680 Nordhoff St. in Chatsworth for $21 million.

Neutraderm has occupied a space next to the property 15 years ago. The company will combine the two, as well as one other nearby structure, to create a large complex. The 115,000-square-foot complex will be the company’s West Coast flagship location.

“In our industry, you need to be tapped into both the West and East Coast, and there’s no better centralized location on the West Coast other than Los Angeles, particularly the San Fernando Valley area,” Samuel Raoof, chief executive of Neutraderm, said in a statement. “The West Coast has a long track record of leading innovation, technology and ingredient development for our industry. We have rapid growth plans for our business, which includes a larger presence on the East Coast, but they start here.”

Sold: 20680 Nordhoff St.

The site will incorporate new technology to support sustainability initatives and optimize workflow, the company said.

Lee & Associates – L.A. North/Ventura Principals Erica Balin and Scott Caswell represented the buyer in the sale. Nordhoff XC was the seller.

“We are seeing a major influx of companies seeking innovative manufacturing spaces as they expand in Southern California,” Balin said in a statement. “This submarket is not only attracting new companies; those that are already here are seeking creative ways to expand their footprint and plant their flag firmly in the San Fernando Valley for the long term. This is a strategic real estate play for the company and will set the stage for their continued strategic operational efficiency.”

“Expanding their footprint in Los Angeles without having to relocate their operations was a win for our team, and we’re confident that this new complex will be a game-changer for their future growth plans,” Caswell added.

Hannah Welk

Gray Duffy Expands Its Offices

Business litigation firm Gray Duffy LLP this summer expanded upon its growth spurt from last year.

The Woodland Hills-based firm took out additional space on its floor – to the tune of 2,000 square feet – as it added three new window offices, an additional conference room, numerous internal workstations and a wellness room. The firm knocked out the dividing wall to achieve a contiguous space.

Gray Duffy – which formed in 1990 – entered this space about 18 months ago, moving into the 19th floor at 21700 Oxnard St. in the Warner Center. It had previously been based in Encino but had outgrown the space as it built out an attorney headcount of about 16 attorneys. (The firm also maintains an office in Redwood City.)

The expansion brings Gray Duffy to about 10,400 square feet of space. It is approaching two years on a five-and-a-half-year lease at the location.

Offices: Gray Duffy is growing.

At the time of the move, firm managing partner Mike Eisenbaum noted Gray Duffy was in growth mode on account of a surge in workload from existing clients. The firm this summer added associate Jonathan Semerjian to its litigation team, which combined with the three others hired last year points to a 25% growth in that timeframe. This would place it within the Los Angeles Business Journal’s Top 25 Valley law firms based on attorney headcount.

With a focus on civil, construction and business litigation, Gray Duffy has amassed a wide variety of corporate clients – such as a major insurance providers – as well as public sector entities such as the Los Angeles County Metropolitan Transportation Authority, or L.A. Metro. The firm also handles automotive, employment, health care and personal injury matters.

The American Bar Association recently recognized Gray Duffy’s work in its appointment of partner Timothy Thornton and associate Katie Camerlengo to the organization’s Tort Trial and Insurance Practice Section for the 2024-25 year. This panel serves as the bar association’s conduit to examine and discuss emerging issues and technologies in tort, trial and insurance law.
— Zane Hill

My Biggest Mistake: Tim Gaspar

Tim Gaspar

Tim Gaspar is the founder and chief executive of Gaspar Insurance Services. Gaspar is a lifelong entrepreneur – he started his first business in high school and went on to run a number of businesses while attending California State University, Northridge.

Today, his company is one of the largest independent insurance firms in the San Fernando Valley and Gaspar sits on the board of various organizations. But things haven’t always been smooth sailing. Here Gaspar discusses a few missteps from his career.

Adventures With Pepsi

I’ve been an entrepreneur my whole life, even before I knew what that word meant. As a kid I used to read the business section in the newspaper with my dad, Entrepreneur magazine, etc. I remember telling my dad the statistic that most entrepreneurs went bankrupt twice on average during their lifetime (not sure if that was actually true or not).

In elementary school I sold candy and toys to classmates, I built a haunted house business in junior high and a party rental business in high school. When I was 19, I started a business manufacturing hide-a-safes that looked like Pepsi bottles. The Pepsi bottle business did well until the nice attorneys at the real Pepsi found out and they were not fans of my little invention and subsequent business. Pepsi seized my company and sued me into oblivion, and I filed personal bankruptcy at 19. Upon hearing the bankruptcy news my dad said, “Good news, you only have to do this one more time.”

Trust But Verify

During my time building Gaspar Insurance I did about half a dozen acquisitions of smaller insurance agencies. I was feeling pretty confident in my ability to size up an opportunity and make a deal when I was approached by the daughter of an insurance agency owner that had just passed away.

During my due diligence I noticed some of the insurance carrier agreements were missing pages or entire contracts. The daughter said she didn’t know where the missing pieces were and some of the files were just a bit of a mess. I foolishly concluded that the contracts were probably “fine” and moved forward with the purchase.

Only after buying the agency did I learn the agency “owner” didn’t actually “own” anything, all the policies were actually owned by another firm. I went back to the daughter who I made the deal with and she was in the wind, I had been swindled. A little bit more due diligence on my part would have kept me from starring in my very own episode of American Greed.

Lessons Learned 

People say success is a lousy teacher and they are absolutely right. It’s these mistakes and ones I will keep much closer to my chest that create the best lessons.

5 Things To Know: Armida Ornelas

Armida Ornelas. (Photo by David Sprague)

Armida Ornelas is the president of Los Angeles Mission College in Sylmar. During the course of her career, she has held a number of roles with the Los Angeles Community College District. She earned her master’s degree in public policy studies from the University of Chicago and her doctorate from the UCLA School of Education.

1: She is the daughter of immigrants. Ornelas’ parents came to the U.S. from Mexico in the 1960s. Ornelas says being the daughter of immigrant parents is “one of the things I’m most proud of.” She adds that her parents came to the U.S. to make a “better life for themselves and their children.”

2: She wants to create opportunities for marginalized communities. Ornelas says being the daughter of immigrants is what brought her to her current job which she says is “more of a calling rather than simply a career.” She adds that she is “very intentional about creating opportunities for others, particularly others that have similar backgrounds.” She says things like the time of day of classes and the languages programs are promoted in all play into this.

3: Ornelas is a big fan of Chicano art. She says The Cheech Marin Center for Chicano Art & Culture in Riverside is one of her favorite places to visit and enjoys art that “speaks to social movements in particular.” Despite her love for art, she is not an artist herself. “I have no artistic abilities,” she jokes.

4: She has two grandkids. When Ornelas is not working, she enjoys spending time with her two grandkids. “We like going to a lot of cultural events,” she says. She routinely takes them to museums and to farmers’ markets.

5: Ornelas is an avid hiker. When not working or going to a
museum, she likes to hike. She brings her kids and grandkids on hikes with her sometimes as well and says that hiking helps her “stay balanced and centered.”

Northrop Builds New Flight Wings

Flight: The Model 437 Vanguard flying over the Antelope Valley.

Northrop Grumman Corp. late last month debuted wings for the Model 437 Vanguard technology demonstrator aircraft built by its subsidiary Scaled Composites.

Northrop, at its Palmdale facility, incorporated its digital ecosystem and advanced manufacturing capabilities to develop, analyze and build the wings for the Vanguard aircraft in advance of the plane’s first flight on Aug. 29 from the Mojave Air and Space Port. Scaled Composites is based in Mojave.

Known as the Digital Pathfinder program, the project demonstrated how the company’s fully digital engineering ecosystem reduces engineering rework, accelerates schedules and reduces costs, offering advantages to customers on future aircraft programs.

Scaled Composites leveraged extensive experience in rapid design, fabrication and test of experimental aircraft to develop the Model 437 Vanguard, while Northrop defined, developed, built and verified the removable wing assemblies using advanced digital tools and manufacturing processes as part of its Digital Pathfinder program, the release said.

Colin Miller, vice president of engineering at Northrop Grumman Aeronautics Systems, said the company continues to refine its digital tools and capabilities to improve them for future efforts.

“This project demonstrates how high-fidelity models within our digital ecosystem serve as a single source of truth to streamline testing and certification on future aircraft, significantly saving cost and time for our customer,” Miller said in a statement.

Brian Maisler, the test pilot, said that the first fight of the Vanguard was in a good jet with a great team.

“This is the best part of my job,” Maisler said in a statement. “Thanks to everyone and their two years of hard work culminating in making this an uneventful and fun day.”

The Model 437 began as a conceptual design, based on the Model 401, exploring a multi-mission low-cost attritable – or expendable – aircraft, according to the Scaled release.

The Vanguard is a crewed variant of the original concept powered by a single Pratt & Whitney 535 engine with approximately 3,400 pounds of thrust. The aircraft has a wingspan of 41 feet and is 41 feet long with a gross takeoff weight of 10,000 pounds, the release added.

After completion of envelope expansion, the Vanguard will have a range of approximately 3,000 nautical miles and an endurance of 6 hours. The aircraft can carry up to 2,000 pounds of payload in multiple locations including an internal weapons bay sized to accommodate two AIM-120 advanced medium-range air-to-air missiles, the release said.