In an effort to attract more shoppers, the North Hollywood business community is planning to open a farmers market at the Academy of Television Arts and Sciences beginning in March 2002. Local business leaders believe they’re finally onto something. So, the San Fernando Valley Business Journal asks: Will a farmers market improve the business climate in North Hollywood? Bruce Spiegel President jewelfactory.com North Hollywood All over Los Angeles, local farmers markets bring the traditional neighborhood ambiance back. The proposed plan for the North Hollywood area is a good idea that can bring shoppers to the doors of area businesses. The location is the key to success. For example, the population center such as Valley Plaza or the NoHo arts district. Don Potter President PKPF Inc. North Hollywood The farmers market will not have an immediate impact in the business community, but it will eventually open the door for retail services, primarily in the NoHo arts district. As long as the entertainment place is around (theaters, restaurants, subway, etc.), the plan will enhance awareness to people and eventually increase business opportunities. Loretta Dash Accountant Davis & Dash North Hollywood We hope that the number of people and businesses would increase on a regular basis once the farmers market opens. The first rule of marketing would be to attract people and businesses. The effective tool to accomplish this objective would be to set projected sales and examine the change in population within the area on a monthly basis. Carlos Sandoval Vice President of Operations Acey Decy Lighting North Hollywood It will have a zero effect on my business. I think it will be beneficial and appealing specifically for retailers because the hours of operation coincide with each other. Linda J. Loe Director, Community Relations Academy of Television Arts & Sciences North Hollywood We want this area to become chic for tourists as well as locals. It has an enormous potential for business opportunities. The plan is a stepping stone for a thematic approach and to provide “the best of the best” trendsetter community. Tammy Sutyac Production Manager VITAC North Hollywood This event won’t really affect our (close-captioning) business. A farmers market would be a great asset to augment the trend developing in this area. The results will increase traffic and attract other businesses. Stephen Gomez Owner Stephen M. Gomez Insurance North Hollywood It is an effective business decision. The plan will give us the opportunity to promote our business by direct contact with customers. The opportunity knocks at NoHo. Joe Hooven President Universal City-North Hollywood Chamber of Commerce North Hollywood This opportunity will bring many people from the residential area to the business area. It will add value to the community and expose many businesses to the growing culture of NoHo.

The secession movement may have lost one of its most vocal advocates and Valley VOTE, the group pushing for a municipal breakup, appears to have lost one of its largest contributors in David Fleming. The attorney and chairman of the Economic Alliance of the San Fernando Valley said Thursday he would likely no longer be able to contribute money to Valley VOTE because of his appointment in August to the Los Angeles City Ethics Commission. Fleming and Galpin Motors owner Burt Boeckman are known by many to be two of the organization’s top financial contributors. But because of commission guidelines, Fleming cannot contribute to a political campaign or lobbying effort of any kind and, although Valley VOTE calls itself an “educational” entity, the same laws would apply to it if and when a secession initiative is put on the ballot in 2002, Fleming said. Fleming said Thursday he has the option of contributing to Valley VOTE up to and until the Local Agency Formation Commission (LAFCO) clears the way for a ballot initiative, but has chosen to err on the side of caution. “I will not contribute any further to Valley VOTE,” said Fleming. “I can give my opinion on something if they call me and ask me for it, but I’m now bound by the rules that pertain to these issues and I have to do what is fair.” Fleming said he gave Valley VOTE $40,000 to fund the group’s initial petition drive in 1998 to get the city and LAFCO to conduct a formal study on secession. He also made Valley VOTE a $15,000 loan the same year. Fleming was appointed to the commission by newly elected City Attorney Rockard “Rocky” Delgadillo after he was booted off the city fire commission by Mayor James Hahn a maneuver viewed by many city hall insiders as political tit-for-tat related to secession and Valley politics. Fleming replaces Rev. Monsignor Terrance Fleming (no relation), whose term expired in August. Appointments for the five-year terms must be approved by the full city council and members can only be removed for cause, according to Commission Executive Director LeeAnn Pelham. Despite the fact Fleming has been one of Valley VOTE’s biggest contributors, Chairman Richard Close said he did not view Fleming’s appointment or inability to contribute money as a serious blow. He said Valley VOTE has already received the bulk of the financing it needs (in part through Fleming), and that its financial requirements from here on out would not be difficult to secure. “David Fleming will be a very valuable member of the ethics commission, especially since it has been granted greater authority to investigate wrongdoing within the city when it pertains to campaign finance and other wrongdoing,” Close said. “We’ve always raised our own funds and with this (possibly) coming on the ballot next year, I believe it will be easier for Valley VOTE to get widespread support as needed.” Close went on to say the bulk of the funds for a secession drive will be raised by the candidates who run for offices in the new Valley city and a soon-to-be-created political committee that will act independently of Valley VOTE. Not only will Fleming have to sever financial ties to the secession movement, he said he must also abstain from deliberating on issues before the commission pertaining to Valley VOTE and LAFCO. The Ethics Commission is now reviewing a request by City Councilman Hal Bernson, a long-time LAFCO board member and Valley resident, to investigate whether Council President Alex Padilla broke the law last month when he stripped Bernson of his voting powers on LAFCO by making him an alternate and replacing him with secession foe Councilwoman Cindy Miscikowski. Fleming and Close stood alongside Bernson during his formal press conference announcing his push for a formal inquiry into the matter. “I have already recused myself with regard to Hal’s request because I was present with him when he held his news conference,” Fleming said. It is the City Ethics Commission that has long tried to force LAFCO to push Valley VOTE to reveal its financial contributors. Until recently, LAFCO said its hands were tied under state Fair Political Practices Committee law. But in January a revision to the Cortese-Knox Act, the 1985 law that established new guidelines for LAFCOs across the state, went into effect. Authored by Assembly Speaker Bob Hertzberg, the amendment essentially closed a loophole that had been keeping LAFCO from responding to the commission’s request. Consequently, LAFCO established a sub-committee to look into the matter. But LAFCO Executive Director Larry J. Calemine said Aug. 30 that the subcommittee concluded Valley VOTE is not bound by state laws and that LAFCO would not push the matter further. He did say LAFCO agreed to expand its application procedures by asking groups like Valley VOTE to tell the panel if they hire a lobbyist. “This commission didn’t want to change (reporting policies) in any way and felt it would be unfair to apply to people or groups seeking special reorganization,” said Calemine. Fleming said he would also have to remove himself from any commission action relating to the LAFCO/Valley VOTE financial reporting issue. Despite the links between Fleming, LAFCO and Valley VOTE, Pelham downplayed any suggestion of a possible conflict of interest. “I think we are looking forward to Mr. Fleming’s experience in the city and the benefits we will get from his having served for as long as he has,” said Pelham. Pelham said the commission has yet to see anything in writing from LAFCO about its subcommittee’s decision relating to Valley VOTE. Although LAFCO isn’t required to report back to her panel, she said she would ask Calemine to make the decision public. “Our view is that whenever the voters are being asked to act on something that could lead to a ballot issue, the public ought to be given the full picture of whatever influences are going to help a reorganization effort,” she said. Close, also a LAFCO alternate, said Fleming’s inability to take part in Bernson’s request posed little threat to LAFCO or Valley VOTE. “There are many other issues besides cityhood the ethics commission will be involved in that will translate into making the government more responsible,” Close said. Ben Austin, special assistant to Delgadillo, said his boss looked into every possible conflict of interest before appointing Fleming. “Is it a conflict? Absolutely not,” said Austin. “Mr. Fleming’s ethics are unimpeachable.”

Advertising Lucy St. George was appointed executive vice president for Inter/Media Advertising. St. George has more than 20 years of direct response advertising experience. Previously, she had been an executive vice president and managing director for Initiative Media North America. Prior to joining Initiative Media, she was sales manager with Direct Response Marketing. Health Care Matthew S. Gerlach was named senior vice president and manager for Kaiser Permanente. Gerlach oversees Kaiser Permanente Health Plan and Hospital operations for medical centers in Panorama City and Woodland Hills and medical offices in Bakersfield, Antelope Valley, Santa Clarita, Simi Valley and Thousand Oaks. Previously, he served as president and chief executive officer for Beverly Hospital in Montebello since 1995. Gerlach has been in the health care field for more than 20 years, focusing on information systems and technology, physician-hospital relations, community outreach and government relations and women’s health issues. North Hollywood-based IPC-The Hospitalist Company has appointed Mary Jo Gorman as vice president of medical affairs. Gorman will assume company-wide responsibilities including assisting IPC develop strategies that enhance clinical performance. She received her medical degree from Southern Illinois University School of Medicine and began practicing as a hospitalist in St. Louis in 1997, starting the first hospitalist practice in the region. Mortgage Lending Calabasas-based Countrywide Home Loans Inc. announced Debbie Rosen will head its B/C Lending Group as executive vice president of subprime lending. Rosen has served on the boards of the National Association of Mortgage Brokers and National Home Equity Mortgage Association. Previously, she was president of Home Equity Services for Associates First Capital Corporation and held management positions with Primerica Life Insurance Company and ITT Financial Services. The company also made the following appointments: Paul Abbamonto, named division executive vice president of Subprime Production; Rob Champion and Tom Wagner, former top producers in the B/C Lending Group, promoted to first vice presidents of Subprime Production for the company’s western and eastern divisions; and Mike Lamka named division executive vice president of subprime operations. He will manage the development and execution of policies and procedures for the processing, underwriting, funding and closing loans at the division’s subprime production centers. Real Estate Jim Thomson has been appointed vice president for NAI Capital Commercial. Thomson will focus on acquisitions, brokerage, consulting, portfolio management and capital markets. Previously, he was director of acquisitions with Limar Realty Group. He also served as area manager major property equities with Grubb & Ellis and was head of his own brokerage firm. Technology Chatsworth-based International Remote Imaging Systems Inc. (IRIS) has named John Caloz chief financial officer and vice president, finance. He will oversee the finance, human resources and management information systems functions of the company. Prior to IRIS, he was CFO for Synarc Inc. in San Francisco, senior vice president of finance and CFO for Phoenix International Life Sciences. Westlake Village-based CaminoSoft Corporation, a data storage and retrieval systems firm, has appointed Sam Hassabo as president. Hassabo has more than 27 years of executive experience in the information technology field. He spent the past two years as managing partner overseeing e-business with Cambridge Management Consulting. He also served as president and chief executive officer for Genesis Intermedia Inc.

The year was 1999 and what a year it was for the 36-year-old Westlake Village-based K-Swiss Inc. Sales skyrocketed to $285 million from $161 million in 1998; earnings nearly tripled to $34 million from $12 million. But there was a glut in the athletic footwear market and many of K-Swiss’s customers started either closing up shop or filing for bankruptcy. By the time 2000 rolled around, K-Swiss Chairman and President Steven Nichols knew it was going to be difficult to keep up the pace. One by one, K-Swiss’s customers found ways to cope with the onset of a weakening economy. Another shoemaker might have tried to expand its distribution into mass market stores, but K-Swiss held its ground, fearing the brand it had built would be tainted by widening distribution. Nichols recently spoke with Business Journal reporter Jacqueline Fox about the challenges K-Swiss faced last year. “1999 was a stellar year for us, but when we looked at the year 2000 we knew it would be a down year and the growth simply could not continue because many of our important customers were in big trouble. There were simply too many stores out there, too many square feet of retail space selling athletic footwear and there had to be a correction. “One of our top-10 customers, Just For Feet, filed for Chapter 11. We stopped selling to Oshman’s Sporting Goods for credit reasons and Foot Locker shut down about 200 of its stores. Our sales declined and we finished at $221 million (in sales) and we earned $21 million, so it was down significantly. Our challenge was how to keep true to what our brand stands for. One of the ways we differentiate ourselves is we have upscale and limited distribution. So one of our options for 2000 would have been to seek distribution in new markets, but we decided not to do that. We decided to stay true to our long-term plan and look beyond 2000. Now we are looking at 2001 and Just for Feet has reorganized and been purchased by a solid company. Oshman’s was also bought and is back in business and financially strong. Foot Locker is now opening stores again and looking for good locations. The market saw how we handled a bad year and both retailers and consumers respect our brand even more. Many of our current retailers tell us that we are the most profitable and highest turning brand in their store.”

Here’s one way to capitalize on a cable war. In case you hadn’t noticed, DirecTV has been aggressively targeting Time Warner Communications subscribers in the West Valley and across Southern California who have been affected by the on-going battle over fees imposed by Fox Sports Net that have resulted in a blackout of Los Angeles Dodgers games since late July. The digital entertainment service provider is now offering a dirt-cheap dish installation promotion, hoping to capture those Time Warner subscribers who, DirecTV is guessing, want to watch what few Dodger games are left in the season particularly if the team manages to stay in a pennant race. In turn, Time Warner has been running a 30-second commercial featuring testimonials from disgruntled satellite dish owners. It all boils down to money, naturally. But, depending on whom you ask, it’s either just pennies, or millions of dollars. In 1999, Fox Sports Net asked cable operators to pay a 21 cent-per subscriber monthly surcharge to pick up the Dodger telecasts. Fox Sports Net had bought the rights to an additional 40 games to add to the 40 it already had scheduled and said it was simply passing on fees it must pay its parent, Fox Entertainment Group, which also happens to own the Dodgers. Time Warner paid the fee. The company also paid in 2000 when the surcharge jumped a penny to 22 cents per subscriber, albeit reluctantly. But this year the cable company put its foot down when the fee jumped to 23 cents per subscriber and, for almost a month, its customers have been forced to look elsewhere for their Dodger fix. Fox says most of its operators here and across the country have agreed to pay the fees and, frankly, don’t know what the big deal is. But for Time Warner, this is bigger than the Dodgers; it’s an across-the-board attempt to halt the rising costs of programming it says it must pass on to its customers in the way of rate increases. Time Warner rate increases for this year took effect in January. This year, the rate for the basic package, which includes Fox Sports Net but none of the pay channels, went up 49 cents from $26.25 to $26.74. The increase includes the city franchise fees. Time Warner has also blacked out Houston Astro, Texas Ranger, Kansas City Royal and Pittsburgh Pirate games since July over the same surcharges, although the fees vary from market to market depending on the number of games offered, according to Lynn Yaeger, a senior vice president for Time Warner based in Stamford, Conn. Recognizing a golden opportunity for increasing its customer base, DirecTV is offering a free satellite dish, receiver and installation, with no long-term commitments to those Time Warner subscribers caught in the fray. Advertising began with radio spots in early July and kicked into high gear about 10 days ago with a massive doorknob-drop campaign to all Time Warner households. Time Warner won’t say how many households in the Valley that is, but Fox officials say the company has around 350,000 in Southern California. DirecTV’s manager of public relations, Marc Altieri, based in El Segundo, said it’s too soon to tell how many dissatisfied cable viewers have responded to the offer, but he claims calls to the “hot line” listed on promotional materials are increasing daily. “We went out to all Time Warner customers’ homes letting them know what we have and, if they are upset by the impasse, that we have an alternative,” said Altieri. “What I can tell you is that we have seen a huge increase in volume of calls to the phone number, which we created just for the situation. And we feel that the longer this goes on, the more responses we are likely to get.” Typical costs for DirecTV products and installation run between $150 and $200, he said. Altieri said DirecTV has roughly 10 million subscribers nationally, but he could not break out how many customers live in the Valley. Takers will still have to pay DirecTV a $24.95 shipping fee plus monthly programming costs, depending on what kind of service they choose. DirecTV’s monthly fee for a basic package, which includes Fox Sports Net, is $31.99. However, that does not include a $5.99 surcharge for access to local channels. Eric Brown, general manager for Time Warner Communications in Chatsworth, had little to say about DirecTV’s promotion except that it proves the cable industry doesn’t quite have the monopoly on the market many are led to believe. He added that what DirecTV does is fair game, but he advised those thinking of making the switch to read the fine print. “I think it’s testament to the fact that we are in a competitive marketplace now,” Brown said. “So recognizing the fact that people have a choice, I would tell you that the responses that I have received have been very supportive of the position we are taking of trying to continue to manage costs.” Brown said there have been “some encouraging signals” regarding ongoing negotiations with Fox, but declined to say what Time Warner was specifically asking for: a cut or a cap in the Dodger surcharges. “It’s not our policy to comment on programming contracts,” he said. According to Dennis Johnson, spokesman for Fox Sports Net, Time Warner is the only cable operator who has declined to pay the surcharges. He said Time Warner’s assertion that the fees this year alone would mean an additional $1 million in expenses for the company is misleading. He said Time Warner has positioned the fee as a 23 cent-per subscriber increase, instead of a 1-cent increase over the 22 cents it paid last year. With a 1 cent-per subscriber monthly rate increase for 350,000 subscribers (a figure Brown refused to confirm), the actual additional cost for Time Warner to broadcast the games this year over last is really about $42,000. “That’s a drop in the bucket, when you consider how big they are,” said Johnson. “They paid the fees last year, which were only one cent lower per subscriber, so my question is what are they doing with all that money that they aren’t paying for the Dodger programs this year.” Time Warner says Fox is wrong to characterize the dispute as one over pennies. “They are trying to belittle it as cents,” said Brown. “But when you add up all those markets, we are talking millions.” However, both Brown and Yaeger refused to say exactly how much Time Warner had paid out to date to cover the surcharges for Dodger games. “We simply won’t supply the breakdown of dollars that way,” Yaeger said. Brown also said Fox was misrepresenting the total amount of the surcharge, but refused to say what they were either, citing contractual agreements. Instead, he suggested Fox Sports Net has spent a bundle on its own advertisements about the rift, money it could have used to make a good-faith effort to end the standoff. “Remember, this is not a local issue, it’s not just here in Los Angeles,” said Brown. “It’s a nationwide deal, so even if I wanted to run (the games) tomorrow I couldn’t do it.” As for Time Warner’s “testimonials,” Brown said the ads began appearing “months ago,” and are indeed part of a strategy to undermine DirecTV’s efforts. “They are certainly designed to inform our customers about some of the fine print that you don’t find out about until later,” said Brown. “As an example, in this Fox Sports dispute, you pay a $5.99 surcharge just to get the local channels, but that’s not spelled out when you see the $31.99 ads.” Altieri said the surcharges for local programming are something both Fox and Time Warner should understand all too well, even if the comparisons are apples to oranges. Digital satellite operators fought for and won the right to pick up local channels about a year ago but, like the cable operator and the network affiliates, they too must pay fees for the privilege, which, you guessed it, are passed on to the consumer. “To compare what amounts to us as a nationwide expense representing a whole lot of money to broadcast a huge package of entertainment and news programming to a surcharge on Dodger games is simply ludicrous,” Altieri said.

Bludgeon, don’t split, LA The move toward San Fernando Valley secession reminds me of a story my father used to tell of a man who worked 30 years for city government, polishing the cannon in front of City Hall. One day he became angry with his employers for the way he was mistreated. So he bought his own cannon, and went into business for himself. The San Fernando Valley works very well as a major part of Los Angeles. But if we secede, then we’ll have a city well fitted out with only about half the things a city must offer to provide a good quality of life for its citizens. Certain groups will make a fortune during and immediately after the transition, to be sure. But the average Valley citizen won’t be any better off, and in fact will probably be worse off. We’d get far better results, dollar for dollar and pound for pound, by organizing and using our clout to bludgeon Los Angeles into giving us more of what we want, without taking away any of what we already have. Robert Moskowitz Woodland Hills

Tech firms from the 101 Technology Corridor again dominate Deloitte & Touche’s annual list of fastest growing technology firms in the five-county Los Angeles area. The ranking of the Los Angeles area’s top 50 won’t be known until the personnel services firm holds its annual awards dinner in September at the Skirball Center. But firms from the Valley and the 101 Corridor make up 26 of the 50 finalists, many of which continued to grow last year despite the downturn in the tech sector. The key to avoiding all the pitfalls of some of their competitors, the firms say, has been having a larger number of clients rather than relying on a very few large ones and a focus on customers in California and Asia, whose economies have not been hit as hard as others. The list is one of 22 Deloitte & Touche uses to highlight the fastest growing technology firms in the U.S. To qualify, companies must have been in business for a minimum of five years, not be a subsidiary or division, and have 1996 revenues of at least $50,000 and 2000 revenues of $1 million or more. Last year’s No. 1 entry, Calabasas-based Digital Insight Corp., figures to make another bid for the top spot by more than doubling its revenue from a year ago. In 2000, Digital Insight reported a net loss of $60 million on revenue of $54.4 million, compared to a 1996 net loss of $700,000 on revenue of $1.6 million. “We have a diverse client base and our orders have remained steady,” said Kevin McDonnell, CFO for Digital Insight. Like other area firms in the Fast 50, Digital Insight has sustained its growth because many of its customers are in California where the tech downturn Silicon Valley notwithstanding has not been as drastic as in other parts of the country, he said. Gary Dickey, a partner in Deloitte & Touche’s Technology and Communications Group, said this year’s group of nominees shows how companies can continue to grow despite a slowing economy. “It says that in difficult economic times, these companies have continued to exhibit entrepreneurial expertise, energy and talent,” Dickey said. Which is not to say the companies on Deloitte & Touche’s list have not been affected by the economy. Dickey said the highest rated companies have growth rates that are much lower than those of a year ago. Revenue for Camarillo-based Interlink Electronics Inc., ranked 41 last year, for instance, grew by 21.4 percent from 1998 to 1999, but slowed to 17.2 percent between 1999 and 2000. Newbury Park-based Semtech Corp., ranked 31 last year, saw a slight decline in its revenue growth, from 34.2 percent in 1999 to 32.3 percent in 2000. Thousand Oaks-based Xircom Inc., ranked 33 in last year’s list, also saw a decline in revenue growth, from 34.8 percent in 1999 to 14.5 percent in 2000. “The slowest-growing company on the list last year had a percentage that is a little higher than it is this year,” Dickey said. Westlake Village-based semiconductor-maker Diodes Inc. is also among the finalists, in its first year on the list. Diodes’ revenue grew to $118.5 million from $56 million in 1996 for a 63-percent revenue increase. C.H. Chen, president and CEO of Diodes, said the company’s inclusion on the list proves it is becoming an institution in the tech industry. Chen said the company has continued to grow despite the downturn in the semiconductor industry due to its strong relationships with customers and through its acquisitions. Last year, the company acquired a factory in Kansas City and increased its sales in Asia. Others making the list were Thousand Oaks-based biotech giant Amgen Inc., Calabasas-based Tekelec and Calabasas Hills-based THQ Inc., all of which showed sharp growth over the past five years. Semiconductor and electronics manufacturers dominated the list. Semiconductor maker Semtech, for instance, is among the fastest growing firms, with its 2000 revenue of $256.7 million up from $173.8 million a year earlier. The company’s transition from a military vendor to a developer of high tech communications software and equipment for high tech firms in California and Asia is the key to its growth, said Jack Poe, chairman and CEO of Semtech. The company’s focus on semiconductors used in popular consumer products like computers and cellular phones, along with test equipment and medical devices, has pushed its revenues higher, Poe said. Analysts say too many semiconductor firms focusing on telecom firms building broadband networks took a hard hit when the bottom fell out of broadband and telecom markets last year. Likewise, remote control and mouse-maker Interlink has kept up its growth through strong sales in a niche market. The company has increased its revenue from $13.5 million in 1996 to $33.9 million in 2000, much of it due to strong sales in Asia which provided about half of its revenue. Interlink CEO Michael Thoben III credits his company’s ability to consistently expand its product line, ranging from computer mice and cable TV set top boxes to electronic signature-capturing devices and computer touch pads. The company’s customers, about half of which are in Asia, also include Sony, NEC and Toshiba. Camarillo-based Power-One Inc., a maker of power supplies like AC/DC converters and voltage power switchers for PCs and other electronics, is also among the Fast 50 finalists, jumping to $511 million in sales last year from $75.4 million in 1996. But Andrew Huang, an analyst with CIBC World Markets Inc., said Power-One’s growth stemmed from the boom of the telecommunications business. But this year as its largest customers, Cisco Systems Inc., Nortel Networks Inc. and Nokia Inc. cut back, Power-One’s sales have dropped too and continue to decline. Last quarter, for the first time in three years, the company posted a net loss $80 million, due in part to a $110 million restructuring charge, which included an $85 million write-down for devalued inventory. Alberta E. Hultman, executive director of the Los Angeles/Santa Barbara Council of the American Electronics Association, insisted many area firms have continued to grow despite the economic downturn but not all of them. “These are companies that have solid, innovative products that keep them in the forefront of that sector,” she said. “Last year was a good year still for some companies, but I don’t think that’s going to happen again this year.”

After struggling for several years to find a niche for its beleaguered shopping center, General Growth Properties appears ready to reposition Fallbrook Mall. The West Hills complex at Fallbrook Avenue and Victory Boulevard, which lost its movie theater and one of its anchor tenants in the past year, will be transformed into a big box center, housing The Home Depot and a Ralphs grocery alongside smaller specialty chains Linens ‘n Things and DSW Shoe Warehouse, among them and restaurants. The center will be reconfigured to eliminate the indoor mall that once housed a selection of small specialty retailers. Laemmle Theatres is also expected to join the lineup, although that lease has not yet been completed. Since it began to explore ways to overhaul the center, General Growth has considered a number of different options, from creating an outdoor shopping complex filled with fashionable specialty chains like the Third Street Promenade in Santa Monica to an entertainment center. Though the mall is strategically located to draw a large, affluent population, its efforts have been stymied by its proximity to Westfield’s Shoppingtown Topanga and Northridge Fashion Center. Located within five miles of Fallbrook, these competitors include such a large array of upscale fashion retailers, movie theaters and department stores, their presence made it difficult for the center to find a distinctive niche. At the same time, General Growth has had to contend with changes in its current retail lineup. Earlier this year, J.C. Penney Co. closed its outlet store as part of a company-wide downsizing and earlier, General Cinema shut down its movie theater. “The other thing is they were an awkward size. They couldn’t get dramatically larger and so they couldn’t compete with the other (malls),” said Richard Giss, partner with the retail practices group at Deloitte & Touche LLP. “This is a change that really does allow the use of that property to be more in keeping with something that’s going to draw people. And the concept of these big box power centers has been working very well.” General Growth confirmed that it has signed leases with Linens ‘n Things and DSW and it has a letter of intent with Laemmle, but officials declined to discuss the larger retailers also expected to come on board or the changes planned in the mall’s configuration. However, a memo distributed to brokers in the area shows a completely revamped center with Home Depot as the mall’s centerpiece. The planned store will include a 150,000-square-foot warehouse-style unit with a 15,000- to 20,000-square-foot outdoor garden center, the company said. The existing space would have to be reconfigured to accommodate the store, which would be located at the back of the mall near Vanowen Street. “We have a signed lease to develop a new store at Fallbrook Mall,” said Chuck Sifuentes, a spokesman for Chicago-based Home Depot. “It’s predicated on the mall clearing a site. They need to relocate two or three existing tenants on the back side of the mall.” Home Depot would round out a lineup that also includes Mervyn’s, Kmart Corp., Burlington Coat Factory, Sports Chalet and Old Navy. Officials at Ralphs, which is shown on the site plan at the Northwest corner of the mall, did not return phone calls. Home Depot officials said that, together with their parking requirements, somewhere in the neighborhood of 500 to 600 spaces, their stores require about 10 to 12 acres of land, and they expect it will take some time for Fallbrook to clear the way for their requirements. Home Depot expects construction to begin in January 2003 with a completion date set sometime in the summer of that same year. Fallbrook earlier this year began clearing the way for a makeover by removing the smaller retailers that had been housed in the enclosed section of the mall. The property owners have held discussions with many different store groups. Some, such as Costco Wholesale Corp., were said to have discontinued talks because the mall is located too close to an existing Costco store. Home Depot too has another unit nearby in the Warner Center area, but officials at the store said that the area warrants a second location. “The West San Fernando Valley is so densely populated that in our mind it justifies development of another Home Depot store,” Sifuentes said. According to data released by the mall, some 146,000 people live within a three-mile radius of Fallbrook with an average household income of $80,264.

In the blink of an eye, it seems, most of the properties in the Warner Center area have new landlords or will soon. Warner Center Properties, a 2.3-million-square-foot complex of offices that comprise the cornerstone of the business center, is reported to be on the block. In recent weeks, Tishman International Co.’s 21st Century Plaza, twin towers with 517,00 square feet of space, has been acquired by Bentley Forbes Group, a privately held real estate investment company. Warner Center Corporate Center, a 253,000-square-foot building formerly owned by Nomura Real Estate, sold to Grosvenor, a British real estate investor. And several years back, the 35-acre Prudential Insurance of America office complex, since renamed LNR Warner Center, sold to Lennar Partners. In the current market, it’s easy to see why landlords might be interested in divesting. Warner Center lease rates in the past several years have jumped about 35 percent or more in some cases and, with the current slowdown underway, are now leveling out. Less apparent is what’s in it for the buyers, given the same market dynamics. But what the current acquisition activity shows is the long term value buyers are placing on the Warner Center area, despite the recent downturn in leasing activity, say brokers and others familiar with the area. “It does support that it is a very strong, desirable office market, which maybe confirms what most of us knew anyway,” said William R. Boyd Jr., senior vice president with Grubb & Ellis Co. “But when institutional ownerships pursue a market, it’s a further validation that the market is strong and the prospects are good for the future. This latest spate of acquisitions will place Warner Center squarely in its third generation of ownership, a sign that the Warner Center market has evolved into a stable, long-term real estate investment. Warner Center Properties, owned by a joint venture between Alaska Permanent Fund Corp. and Harvard University’s endowment fund, will likely be acquired by another institutional investor or real estate investment trust. And Warner Corporate Center and 21st Century Plaza are also in the hands of professional investment companies. Only LNR Warner Center is owned by a development company, although it too is a division of a large, publicly held real estate firm. “The first generation was speculative,” said Larry Kosmont, president of real estate consultancy Kosmont Partners. “The second was probably less speculative and a little more institutional. The third is looking at an area that’s stabilized. They’re saying they like this area and it’s worth the investment because they get a good stabilized return that’s not risky.” The newest owners will probably not see any increases in the value of their investments for some time some estimate it may be another 18 months before rents resume their upward climb. But so far at least, Warner Center has retained its value, in some cases to a greater degree than the pricier Westside L.A. real estate. And the community’s diverse tenant mix, coupled with its proximity to the growing 101 Tech Corridor suggest that it is well positioned once the market swings upward again. “Where you had a lot of businesses on the Westside go out of business, you haven’t seen that here,” said Brad Rosenheim, a principal with Rosenheim & Associates, which represents the Warner Center Association of business tenants. “That may have demonstrated that this area is more solid. There’s no guarantee, but Warner Center has weathered this downturn fairly well. Plus the 101 Corridor has a lot of potential, and I think its location at the east end (of the corridor) makes Warner Center an anchor for that.” Westlake Leases Four new tenants are getting ready to move into Plaza Center III, the 81,500-square-foot office building nearing completion in Westlake Village. Law firm Jackson, DeMarco & Peckenpaugh has leased 12,000 square feet of office space in the building in a five-year deal valued at about $2 million. Stowell, Zeilenga & Ruth LLP, another law firm, has leased 5,200 square feet in a five-year deal valued at $1 million. The two other tenants that will locate in the building are American Title Co., which has taken 2,789 square feet, and Cost View Capital, which has taken 2,500 square feet. A Shot in the Arm There’s apparently no recession for health care. Public managed care companies are reporting strong second quarters, and medical practice groups are continuing to rent real estate. Facey Medical Foundation, a Mission Hills-based group, has leased an 8,867-square-foot medical office in Seco Canyon Plaza, a retail center under construction in Santa Clarita. Facey’s 11-year lease is valued at $2.7 million. The 23,497-square-foot retail complex, slated for completion in December, will also house Kindercare, Starbucks and Coldstone Creamery. Joel Frank, a broker with First Property Realty, represented the tenant. The landlord, Hopkins Real Estate Group, was represented by Ray Bayat, Bert Abel, Mitch Bayat and John Cserkuti of Grubb & Ellis Co. In another deal for medical space, Oxnard/Simi Ear, Nose and Throat Medical Group leased 4,241 square feet of space at 301 S. Moorpark Road in Thousand Oaks. The group, relocating from a smaller facility in Thousand Oaks, also has offices in Simi Valley and Oxnard. Marc Riches, Cheryl Richmond and Cory Richmond, all with NAI Capital Commercial, represented the tenant and the landlord, Los Robles Office Partners LLC. More Simi Homes Cabrillo Economic Development Corp. has acquired 3.72 acres from D & E; Corp. with plans to build a residential development. Cabrillo acquired the land on Kuehner Drive in Simi Valley in order to construct 26 single-family homes. The purchase price was $875,000. Gary Seaton of NAI Capital Commercial represented Cabrillo. The seller was represented by Fred Priebe of Re/Max Professional. Senior reporter Shelly Garcia can be reached at (818) 676-1750, ext. 14, or by e-mail at .

Advertising Lucy St. George has joined Inter/Media Advertising of Encino as executive vice president. Previously, St. George was executive vice president and managing director at Initiative Media North America, where she supervised the direct response division. Aviation The Van Nuys Airport Association Board of Directors elected Curt Castagna president for the 2001-2002 term. Castagna has also been promoted to CEO of The Aerolease Group after serving as general manager since 1992. Aerolease manages airport facilities, including approximately 20 acres in two separate locations at Van Nuys. Education Diane Schwartz was appointed interim dean of the Cal State Northridge College of Engineering and Computer Science. She will oversee and manage the accreditation reviews in the fall for several engineering programs, implementation of focus group recommendations and improvement of student enrollment. Previously, she has been a computer science professor and an associate dean of the college. Entertainment Greg Berglund was appointed senior vice president and general manager of Disney Direct Marketing. Berglund will oversee Disney Direct Marketing, including the Disney catalog and DisneyStore.com. In addition, he will lead all aspects of the marketing, merchandising, finance, information technology, operations, inventory planning and human resources departments. Previously, he was chief operating officer and co-founder of Ambrosia Catalogue. Landscaping Calabasas-based Environmental Industries Inc., a parent company of five divisions including Valley Crest Tree Company, Environmental Golf, Environmental Care and US Lawns, has named a new executive team. Richard A. Sperber was appointed president and chief operating officer. Sperber, formerly president of EII subsidiary Valley Crest, succeeds his father and company founder Burton S. Sperber, who is chief executive officer and chairman of the board of the $500 million landscape and horticultural services organization. Richard Sperber previously held various positions in estimating and project management with each of the company’s divisions. Andrew J. Mandell was named senior vice president and chief financial officer. Previously he had been executive vice president and chief financial officer of Fox Cable Networks Group in Los Angeles. He will oversee the information systems and insurance functions and play a critical role in the execution and integration of acquisitions. Valley Crest Tree Company, a subsidiary of Environmental Industries Inc., announced the appointment of Robert L. Crudup Jr. as president and chief operating officer. Crudup, who has been a senior vice president since 1998, succeeds Stuart J. Sperber, named vice chairman of EII’s board. Sperber will remain with Valley Crest Tree Company as its chief executive officer. Crudup will oversee all Valley Crest businesses. He serves on the boards of the California Landscape Contractors Association and Green Industry Council. In addition, Valley Crest Tree Co. selected Vicki Povah Martinez as senior vice president. She will manage all administrative functions. Thomas C. Donnelly was appointed president and chief operating officer of its landscaping company and wholly owned subsidiary, Valley Crest. Donnelly began his 22-year Valley Crest career as a field sales representative for the company’s Orange County operation and assumed increasingly responsible management and executive positions, including branch and regional management and senior vice president. Nada F. Duna was named vice president for Environmental Care Inc. Duna will continue her role as manager of ECI’s branch in San Jose. Real Estate Isaac Chernotsky was named executive director for The Village at Sherman Oaks. Chernotsky has over 18 years of residential administrative experience in the retirement, assisted-living and senior residence fields. He will be responsible for resident services, operations and marketing for the community. Previously, he has been executive director, manager and administrator for the Garden of Palms Retirement Hotel in Los Angeles.