NATIONAL ASSOCIATION OF WOMEN BUSINESS OWNERS ASSISTS WOMEN IN GROWING THEIR BUSINESSES The National Association of Women Business Owners (NAWBO) represents the interests of women entrepreneurs world-wide. NAWBO’s mission is to develop products and services that meet the needs of established women business owners and support the needs of emerging women business owners. NAWBO traces its origins to a small group of Washington DC business women who began meeting informally to talk about mutual experiences, exchange information and develop business skills. Recognizing the value of the group, they incorporated as the National Association of Women Business Owners on December 19, 1974. Locally, the NAWBO-LA chapter was founded in 1979 and is the largest and most active chapter in the country. NAWBO-LA’s purpose is to: – Be a customer-driven voice within the community to further the success of women business owners – Be a clearing house of information on what is available, where to go and who to contact – Provide a model of the integration of values, profits, technology and people Membership is open to sole proprietors, partners and corporate owners with day-to-day management responsibility. Women-owned businesses operate in every sector including manufacturing, construction, agribusiness, and retail, as well as high-growth industries such as health, business and professional services. NAWBO-LA members own businesses throughout the Los Angeles business community, including the Inland Empire, the San Fernando and San Gabriel Valleys, Westside, South Bay, East Los Angeles, Orange County and downtown Los Angeles. NAWBO membership offers opportunities for the woman business owner to reach business goals and maintain the competitive edge through training, education, corporate connection, networking, peer support, public policy, certification, scholarships, awards and direct discount programs. NAWBO-LA’s Scholarship/Youth Outreach Committee helps and supports young women ages 13-21 that have an interest in becoming entrepreneurs. The Scholarship/Youth Outreach Committee has developed programs for this specific outreach with the help of NAWBO-LA corporate partners, advisory board members and membership at large. The committee accomplishes it’s mission through various programs, including mentorships, youth scholarships and membership scholarships. NAWBO-LA hosts a monthly dinner meeting on the fourth Tuesday of each month and many other networking and educational opportunities for business owners. NAWBO-LA’s third annual business conference will be held on Thursday, May 15, from Noon to 6 p.m. at the Sheraton Grande Hotel, 333 S. Figueroa Street , in downtown Los Angeles. The conference will begin with a luncheon co-sponsored by Town Hall, Los Angeles. The keynote speaker will be Jan Davidson, Director of the Davidson Group and formerly the President and Founder of Davidson & Associates in Torrance., a children’s software company which was purchased last year by CUC International for $1.5 billion. Davidson was the only woman listed on the Los Angeles Business Journal’s listing of the 50 wealthiest business people in Los Angeles. Two break-out sessions will be held in the afternoon, with topics such as negotiating, advertising and public relations, persuasive business presentations, marketing, and technology. Monica Lopez, owner of Hot! Hot! Hot! in Pasadena, which has one of the most successful home pages on the World Wide Web, will be one of the featured speakers on technology. A cocktail and networking reception will be held from 5 to 6 p.m. Registration is $79 for NAWBO-LA members who pre-register before April 30, and $99 for non-members and late registration. NAWBO-LA’s mission is to provide the vision, the values and the voice to further the success of women business owners. NAWBO-LA represents more than 314,000 women-owned businesses in Los Angeles County, the largest concentration of the nation’s 8 million women-owned businesses. For more information, please call the NAWBO-LA office at 800-266-8762. ###

PARTNERING: BUSINESS COHABITATION IS IT FOR YOU? By Barbara A. Frantz, Esq. What happens when you have hired the ultimate consultant to refine your business, downsize to the max, optimize your cash flow and your customer asks for a 10 percent reduction in your price? This issue is facing businesses of all sizes in our present economic environment. As more and more companies are merging, the same supplier base is trying to compete for a downsized client base. If a business has reduced its profit margin to a bare minimum, where does it go to find further reductions? It goes to that grey area along the border between two businesses, both between the business and suppliers, and between the business and customers. What is required to accomplish reductions is a shift in thinking, a shift from “competing” to “partnering.” Women business owners are naturals for partnering, because they have a tendency to create rapport rather than hierarchy in their relationships. This means that when they are introduced to a new person, they don’t automatically assess that person as being above or below them. (See Deborah Tannen’s book, “You Just Don’t Understand” for details). Rapport building tends to create intimacy. Intimacy is the foundation of a good partnering relationship. Women tend to be more comfortable sharing and adapting their vision to those around them. Shared vision is a key element of good partnering. The trend towards “partnering” today is phenomenal. Although many would argue that it is an old concept, as old as having “Guilds” in the medieval times, it’s as if the concept was lost and is now rediscovered. Partnering is not restricted to mega-corporations. Examples of partnering include companies like United Parcel Service who used its core competence in logistics and fleet management to internally manage deliveries at a company with 22 delivery doors….or a company like the local NOW Messengers who provides its staff to be on-site at law offices to manage deliveries to courts, or who provides foot massagers with its advertisements to local chiropractor’s waiting rooms. The Huthwaite Group has authored an excellent book, “Getting Partnering Right,” which discusses in detail other examples and ingredients of a good partnering relationship. The key to understanding partnering is to understand that partnering is not necessarily “partnerships.” Partnering is like cohabitation, partnerships are like marriage. Partnering is like marriage without the paper. Lawyers tend to cringe at the thought of exposing intimate details of a company’s business profile to a supplier or customer without a detailed “Partnership” agreement. Partnership agreements require negotiation which usually requires an “adversarial” attitude. It’s important for attorneys to shift from that adversarial attitude when both parties are in partnering mode. Partnering is different. Partnering starts with a basis of trust, shared vision, loyalty, and some form of immediate impact to the bottom line of both companies. Although partnering usually starts at the business owner level and works its way through the other levels of management at both companies, each company at each level must understand and accept the ingredients. Partnering may involve partnership agreements or may not. More often they require guidelines, policies, procedures and systems to facilitate the interaction between partnering companies. Most often, partnering involves conducting a joint feasibility statement before commencing partnering activity. For partnering to work it is important for each company to identify supportable goals and conflicting goals for each of them. Supportable goals are fairly easy to identify, such as “together we can service this account and increase our share of business within that account” or “together, we can shorten delivery times by 3 days.” Conflicting goals are the dark side to partnering but also must be addressed. Examples of conflicting goals are one company wanting to close the deal with a customer within 3 days, although it would be better for the partnering company to close the deal in three weeks. Partnering should also not be confused with creating intimate business relationships to eke the last ounce of profit from a supplier or customer by having access to information from them you would not ordinarily have. The loyalty aspect of partnering requires that sometimes you won’t make as much profit as you could from other business deals. But the long term nature of the relationship cuts your marketing expense, and increases your accuracy in predicting labor requirements. For example, Bose Corporation, maker of audio systems, empowers their suppliers by giving them “insider status” which benefits Bose, its suppliers and their customer. The traps which have occurred in past partnering efforts include over-relying on any one success factor, such as the partnering companies’ abilities to form an intimate and loyal relationship, or to make a highly profitable first deal. Another trap is to create a “vision in a vacuum” in which you proceed on an exciting idea without first having built trust. Another trap is to create intimacy for intimacy’s sake without responding to the customer’s needs. It is always important to build loyalty with customers, especially when a product may not be very different from a competitor’s product. It is important to have a customer give the opportunity to match a competitor’s offer. It is important for a business to be ready to respond to that “we are now operating with a 55 percent reduction in our list of vendors, if you want to be on the list, please reduce your prices to us across the board by 10 percent.” Partnering affords continued competition. Tremendous opportunity is available now to create partnering relationships. There are consultants available who specialize in partnering. Areas of competitive advantage are harder and harder to find. Partnering is a quantum leap in maintaining the success of a company. Barbara Frantz is the past president of the National Association of Women Business Owners, Los Angeles Chapter (NAWBO-LA)

greatwest/valley/dy/20″/mike1st/mark2nd DOUGLAS YOUNG Staff Reporter The bidding war for control of Great Western Financial Corp. has yet to yield a winner, but one thing is clear: No matter which bidder wins, thousands of Great Western workers are likely to receive pink slips. And many of those layoffs will come from Great Western’s headquarters campus in Chatsworth. The pending layoffs and resulting empty office space will deal a blow at least temporarily to the West Valley office market and to the dozens of local merchants that rely on Great Western employees for business. Neither H.F. Ahmanson & Co. nor Washington Mutual Inc. has announced how many of the 3,000 jobs each would cut at the Chatsworth campus after a merger, although both have indicated some layoffs are probable. Most of Great Western’s headquarter employees work in 1 million square feet of office space spread out among 14 buildings on the campus. Some or all of that space would likely be put up for sale or lease after a merger between Great Western and either Ahmanson or Washington Mutual. Some retailers at the nearby Northridge Fashion Center expressed concern over future layoffs at Great Western. “I probably get about 5 percent of my business from that office,” said Constance Marchetti, manager of George Allen Shoes. “I don’t think it would be a big hit. But to lose that 5 percent, I would have to replace it with something else.” Said Annette Bethers, the mall’s marketing manager: “It’s something we’re concerned about and will be monitoring.” But she noted that any layoffs are probably still months away, adding “We can’t imagine those buildings will sit empty. We’re sure those buildings will be leased to other companies, and that (business) will come back.” Smaller merchants in the area expressed more concern about the pending Great Western merger. Restaurants will probably be hardest hit by layoffs, since many rely on Great Western workers for a significant portion of their lunchtime business. “I really hope they stay here, because we do a lot of business with them,” said Cary Baker, manager of the Kenny Rogers Roasters restaurant located across from the campus on Corbin Avenue. Besides lunchtime customers, Kenny Rogers also caters Great Western functions. Real estate brokers were more optimistic predicting that the Great Western buildings would lease up quickly if layoffs resulted in office space emptying out. They attributed their optimism to the recovering Valley economy, combined with the overall attractiveness of Great Western’s campus as an office location. “I would think the space could get readily leased up within a year,” said Bill Ripberger, a director in the San Fernando Valley office of Cushman & Wakefield of California Inc. “There are big tenants in the market today, and you could probably get one tenant to take the entire” 200,000-square-foot building at the campus center. Likewise, Jeff Woolf, president of the Lee & Associates office in Sherman Oaks, expects most of the Great Western space would only take 12 to 18 months to fill if and when it comes on the market. “This space is well-situated in a nice, campus-like environment,” said Woolf. “It’s quality space, and it will be absorbed.” Woolf noted, though, that a downsizing or departure of Great Western will boost the West Valley office vacancy rate and put downward pressure on office rents there in the shorter term. “The Chatsworth/Northridge office markets are very skinny. Between the two, there’s not 250,000 square feet of Class A office space. So if a lot of this space were dumped on the marketplace, it would have a large effect on vacancy rates in that market,” he said. “We would also probably see some downward pressure on rents, though it’s tough to say how much,” he added, saying the specific amount and type of space being emptied out would influence the magnitude of any downward pressure.

rockwell/mike1st/mark2nd By BEN SULLIVAN Staff Reporter When Boeing North American Inc. inherited the beleaguered Santa Susana Field Laboratory in December as part of its acqusition of Rockwell International’s aerospace and defense units, there was trepidation on both sides of the deal. Rockwell employees feared layoffs after the purchase, and Boeing was assuming liability for pending lawsuits and clean-up efforts stemming from five decades of chemical and radiation leaks at the site. Since then, the 2,668-acre complex of buildings, bunkers and testing towers situated in the northwest San Fernando Valley has downsized by roughly 20 workers. And a new federal class-action lawsuit by neighbors has further highlighted the environmental problems associated with the Santa Susana facility. Still, Boeing says the facility is a diamond in the rough generating a steady stream of revenues by using its Cold War-era technology and personnel to undertake civilian projects on a contract basis. Last year, the test facility did $3 million to $5 million in contracting work, said Mark Gabler, director of the Energy Technology Engineering Center where such work is done. The energy center represents about one-tenth of the laboratory’s total facilities. The contract work has included developing seismic equipment for the California Department of Transportation and the U.S. Federal Highway Administration, auditing for the Southern California Gas Co. and working on an electric bus in conjunction with the Southern California Air Quality Management District, Gabler said. Lawsuits and bad press over chemical spills and other mishaps at the testing facility have “never come up in any course of business,” Gabler said. If anything, 1997 stands to see an even greater amount of contract work at the site, Boeing spokeswoman Lori Circle said. That a business operation battered publicly should continue to thrive commerically is not unusual, said Ken Herbert, an analyst at Frost & Sullivan. “Business decisions are going to be driven by the costs and capabilities of a facility like this, irrespective of the reputation or the environmental impact the site at large has,” Herbert said. “The customer, in all honesty, is not going to be too concerned about some allegations that may be impacting the overall reputation of the company they’re doing business with.” That’s good news for Boeing. In a federal class-action lawsuit filed last month, neighbors of the facility say 50 years of safety accidents at the site have put residents at an increased risk of cancer and other deadly ailments. The neighbors further contend that pollution from the site has caused widespread property damage in the affluent hillside community. If successful, the lawsuit would hold Boeing responsible for economic and punitive damages, medical monitoring for sick plaintiffs and costs for environmental clean-up. “It’s staggering the number of people calling (about the lawsuit),” said attorney Tina Nieves of Gancedo & Nieves, one of two law firms representing the residents. Boeing officials declined to comment on the lawsuit and attorneys for the company were unavailable for comment. But because Rockwell in 1989 stopped most of the activities alleged to have caused the pollution, life at the Santa Susana site will be little changed whichever way the suit is judged, according to Circle. “We don’t do any nuclear work there anymore, and we’re in the final stages of clean-up,” Circle said. The facility’s history is dominated by its five decades as a high-security test site for the U.S. government’s Cold War efforts. It is where the earliest missiles to carry nuclear warheads were tested, and where engines for every major U.S. space launch were built. The facility is run by Rocketdyne, a subsidiary of Rockwell, which sold its aerospace and defense operations to Boeing in December. Over the years, it has housed a variety of toxic materials, from nuclear fuel to carcinogenic solvents used to cool rocket engines after test firings. A series of U.S. Environmental Protection Agency tests in the early 1990s found low levels of radioactive and chemical contamination in surrounding soil and water, but too low to warrant cleaning up, according to EPA project leader Tom Kelly. Kelly oversees current EPA monitoring of on-site clean-up work by Boeing. The lawsuit, instigated by seven current and former residents of nearby neighborhoods, contends that contamination has led to cases of leukemia, breast cancer, bladder cancer and other ailments in the surrounding community. Among the incidents cited in the lawsuit as causing contamination was the release of a cloud of fission gas in 1959 after a nuclear reactor at the site overloaded and shut down; the explosion of a radioactive fuel rod which had been removed from the reactor to be washed; and a series of sodium fires that could have exposed residents to toxic fumes. Last December, a leak in an air conditioning system at the facility released more than 30,000 gallons of coolant, with some of it reaching a nearby creek. Attorney Nieves said plaintiffs will present previously unreleased reports that document such mishaps and experts who will testify on the connection between the contamination and diseases. Nieves comes to the Boeing case after successfully representing Burbank residents in a similar case with Lockheed Martin Corp. Lockheed last year agreed to pay $60 million to more than 1,300 residents who claimed toxic substances from an aircraft parts plant had damaged their health. In the Boeing case, however, “we intend on taking this thing to trial,” she said.

Second-Career Entrepreneur Achieves #100 on List, Heading Senior-Level Executive Search Firm Following her first 20-year entrepreneurial career as a successful public relations agency owner, Betsy Berkhemer-Credaire has achieved Number 100 on this year’s List with her second career company, a senior-level retained executive search firm, called Berkhemer/Clayton, Inc., in downtown Los Angeles. Just over three years ago, Berkhemer-Credaire launched her second-career entrepreneurial venture by bringing together multi-ethnic partners, including men and women, minorities and non-minorities. As is the dream of most entrepreneurs, she sold her original PR firm in 1989 to one of the world’s largest agencies. Also as with most acquisitions, she stayed on for five years as president, working for the new owners. Then it was Rebuild LA and the Los Angeles Riots in April, 1992, that inspired her to start her new enterprise–confident that a retained executive search firm, with special skills in senior-level diversity search, could provide innovative service to corporate client companies. Today at age 50, Berkhemer-Credaire already has the momentum rolling for her next 20-year career. Together with her four partners, plus four full-time and three part-time staff, Berkhemer/Clayton helps companies find talented executives at the rank of vice president or above, in the functional areas of marketing, communications, information systems, finance, legal or human resources–plus directorships for corporate boards, especially boards seeking women and minority directors. For every search assignment handled, Berkhemer/Clayton seeks out and presents the best qualified candidates in the country, including men and women who are ethnically diverse. Berkhemer/Clayton helps corporations achieve greater diversity in upper management by finding the best qualified senior-level executives regardless of gender or ethnic heritage. “Entrepreneurism as a career path is best for people who do not lie awake worrying at night,” explains Berkhemer-Credaire. “For self-starters with a viable product or service to offer, who enjoy serving clients and customers, owning one’s own business is a great way to make a living. You need to be an optimist, an unswerving positive-thinker, and enjoy working long hours. There’s great personal satisfaction in knowing you are creating jobs for others, providing a service for others, and hopefully making some money in return. “After selling my first company, I was surprised to realize that I truly missed the responsibility and sense of pride that comes with having your name on the door. Now that my partners and I have been successful with our executive search firm, I’m looking forward to the next 20 years of my second career with great enthusiasm,” explains Berkhemer-Credaire. “Even though being an entrepreneur can be frustrating at times, the experience is worth every minute. It’s extremely gratifying.” Berkhemer/Clayton, Inc., is located in historic Union Station, downtown Los Angeles. Principals are Fred Clayton, former partner with Ward Howell executive search; Melba Sanders, formerly with Bill Cosby Enterprises, and Bill Imada of Imada/Wong Communications.

SFVREColApr/bb/22 inches/mike1st/mark2nd Two of the hottest real estate markets in and around the San Fernando Valley Glendale to the east and the Santa Clarita Valley to the north each saw noteworthy investment and development activity during the last month. Downtown Glendale, where top office buildings have been filling quickly due primarily to expansion in the thriving entertainment sector, is about to see Southern California’s first major “speculative” highrise office tower of the 1990s. And just last week, city officials and private developers broke ground on the long-stalled $30 million Glendale Marketplace entertainment-oriented retail center at Brand Boulevard and Broadway. The 160,000-square-foot project near the Glendale Galleria regional mall already has four substantial tenant commitments: a 42,000-square-foot WOW! (the Good Guys/Tower Records combo), a 40,000-square-foot Linens ‘n Things, a 36,000-square-foot Mann Theatres four-plex and a 15,000-square-foot Old Navy store. The private-sector developers of the two-building, two-story center slated for a spring 1988 opening are Regent Properties of Beverly Hills and the Tolkin Group of Pasadena. The city is investing more than $16 million to acquire property, relocate existing tenants on the site and construct an adjacent 1,100-stall garage. While the city considers the immediate neighborhood “blighted,” the average household income in the five-mile-radius trade area exceeds $50,000. CB Commercial Real Estate Group is handling leasing at Glendale Marketplace. Arden buys tower Fast-growing real estate investment trust Arden Realty Inc. of Beverly Hills just acquired the 11-story office tower at 535 N. Brand Blvd., a deal that appears nearly as entrepreneurial as the speculative development being pursued nearby. That’s because the building’s only tenant is Wells Fargo Bank, which inherited a lease of about 30 percent of the building’s 110,000 square feet of space when it acquired First Interstate Bank. Arden President Victor Coleman said the company will renovate the entire building and try to “reposition” it while retaining Wells as an anchor tenant. Arden purchased the property from a family trust of Arthur Gilbert, a longtime associate of Arden Chairman Richard Ziman. Coleman said Arden paid “under $100 a foot,” which would put the price at somewhere near $10 million. Arden has engaged Cushman & Wakefield Inc. to lease the vacant space. New project for Canyon Country Out in the Santa Clarita Valley, veteran Southern California builder Raznick & Sons is planning to develop the $20 million Trolley Square retail center in Canyon Country. Depending on tenant interest, the 200,000-square-foot project slated for a 12 acre-site is earmarked for either “big box”-oriented retailers or smaller entertainment- or automotive-related tenants. The site, a half-mile from a Price Club store and a Metrolink commuter rail station, features 675 feet of Sierra Highway frontage, which 35,000 vehicles pass daily. The average household income in the immediate trade area exceeds $60,000. Construction is scheduled to get under way late this summer, with completion slated for early 1998. Woodland Hills-based Raznick & Sons, established in 1930, recently completed a similar development named Trolley Plaza in Oxnard. Among Raznick’s other well-known commercial and residential projects are The Colony at Mandalay Bay Beach and Harborwalk in Oxnard, Beachwalk in Carpinteria, Alpine Village Apartments in Tarzana, The Center Promenade in Ventura and Encino Medical Tower in Encino. Westcord Commercial Group is the exclusive leasing agent for Trolley Square. Valencia apartments sell An affiliate of big apartment owner Western National Group has acquired the 208-unit StoneCreek Apartments complex in Valencia, from Newhall Land & Farming Co., Santa Clarita Valley’s dominant land developer. Irvine-based Western National paid $18.3 million for the 98-percent leased, 1985-vintage complex along McBean Parkway, said a source familiar with the deal. The sale contributed $12.8 million to Newhall Land’s income for the quarter ended March 31. The complex sits on 9.5 acres and includes 13 buildings featuring 16 units apiece. Amenities include fireplaces, pool, recreation center and spa. Newhall Land Chairman and CEO Tom Lee said the sale reflects the strong investment demand for “institutional-quality” apartment properties. He added that Newhall Land plans to reinvest the proceeds into the company’s aggressive commercial real estate development program now under way. Johnson Capital Group in Irvine arranged $11.8 million in acquisition financing for Western National through Prudential Insurance Co. of America’s PruEXPRESS lending program.

SAN FERNANDO VALLEY DUE NOON FRIDAY, MARCH 28 APRIL ISSUE STEELFRAME (Berton) w/photo Under orders from the City Council, owners of certain types of older high-rise buildings must do extensive retrofit work to ensure the buildings won’t collapse in a major quake. Many of these buildings are in the Valley, and the owners are just coming to terms with the expense. Many are apparently unable to afford the repairs, and as a result city officials are considering a bond issue to help cover the costs. ECONOMY (Young) w/chart Is the San Fernando Valley-area economy doing better, or worse, than the rest of L.A. County? We try to answer that question by comparing the Valley against the county on such factors as housing prices, commercial leasing rates, building permit activity, sales tax revenue and other indicators. WAL-MART (Kanter) w/map Wal-Mart is coming to Chatsworth, to a long-vacant site where the 118 Fwy and Corbin Ave. intersect. It’s part of a much larger development. The 118 will get a new Corbin exit, and the street will be extended through several bucolic until now, that is Chatsworth neighborhoods. Homeowners are pissed and “For Sale” signs are popping up all over the neighborhood. CSUN (Sable) w/map Cal State Northridge wants to get into the real estate development business. The former Devonshire Downs site, where Jimi Hendrix played at a “West Coast Woodstock,” would be turned into a 175,000 square-foot retail center with ready access to the more than 40,000 students, faculty and staff at the Northridge Campus. But nearby merchants are screaming unfair competition, forcing the university to get into the P.R. business as well. ROCKWELL (Sullivan) With Boeing’s takeover of Rockwell International, we look at the status of Rockwell’s plans to lease out its Santa Susanna testing facility. Apparently all previous plans are out the window, and Boeing is now evaluating what to do with the mountaintop site straddling the San Fernando and Simi valleys. GREATWEST (Young) w/photo The takeover by Great Western has merchants and property owners in the Chatsworth area anxious about the impact of job losses in the community, while commercial landlords are concerned that yet another big office campus will be on the market. GM PLANT (Taub) The retail/entertainment complex on the site of the razed General Motors plant in Panorama City is lining up its tenants. Mann Theatres had previously signed on for a 3,700-seat, 16-screen movie complex, and now six new retailers have signed on. Who are they, and how do they fit into the surrounding neighborhood? SPOTLIGHT-SYLMAR (Daniels) w/map, photos Sylmar, bursting at the seams with new residents, struggles to boost retail and commercial opportunities. PROFILE-WILSON w/photo (Daniels) Blenda Wilson, CSUN president, on the university’s role in providing professionals for business and its role as an economic and educational center for the northwest Valley. FAST-TRACK (Daniels) w/photo Fast-growing Th*Q Corp. of Calabasas, a publicly traded company that designs games for video systems including Nintendo and Sega. The company was struggling two years ago but has turned around to become one of the fastest growing companies in L.A. County. PORNO (Turner) A Chatsworth-based porno industry lobbying group is lobbying against state legislation that would impose a 5 percent tax on the sale of X-rated entertainment, with the proceeds to benefit rape crisis centers and other women’s groups. The group claims that “adult entertainment does not depict rape, battery or violence.” SCHMIDT (Bel Bruno) w/photo Feature on Nancy L. Schmidt, this year’s Fernando Award winner. MEDIA (Steen-Proctor) Media General, one of two major aircraft servicing firms at Burbank Airport, is expanding its operations serving the corporate jets that operate out of Burbank. YOUNG (Berton) The long-stalled highrise project slated to rise in Glendale touted as the L.A. area’s first “speculative” office tower of the’90s is getting a jump-start from a new ownership group. A partnership headed by local investors expects to close escrow this week on the downtown Glendale site and break ground this summer on a $100 million highrise. (Cole) tk

YOUNG/mike1st/mark2nd By BRAD BERTON Staff Reporter A new ownership group has emerged to develop a long-stalled highrise project in Glendale which could become the L.A. area’s first “speculative” office tower of the’90s. A partnership headed by local investors closed escrow last month on the property, located on Central Avenue near the Ventura (134) Freeway. The project is termed “speculative” because it is being developed without any signficant tenant lease commitments. Developers expect to break ground this summer on the $100 million highrise. Plans for the 24-story, 500,000-square-foot tower illustrate the strong recovery of the commercial real estate market in Glendale, Burbank and Universal City a recovery boosted primarily by the entertainment industry’s rapid growth. The local investors, operating as PacTen Partners, have teamed up with a real estate investment fund managed by an affiliate of Morgan Stanley & Co. to purchase the property from a Korean-American development company. That would-be developer, an affiliate of Mid-Wilshire-based K. Young Development Inc., had purchased the site at 655 N. Central Ave. nearly two years ago for $6 million and originally expected to break ground by the end of 1995 and complete the project in mid-1997. After its Korea-based parent company ran into financial troubles, however, K. Young quietly put the property up for sale last year. K. Young had dubbed the project Palladian World Tower. Nyal Leslie, one of the PacTen partners, said the new development team will pick a different name. The new owners, however, have decided to retain the architectural design that the Landau Partnership created for K. Young, with only minor alterations. Entertainment giants Walt Disney Co. and Warner Bros., in particular, have been quickly leasing up downtown Glendale offices and driving up rental rates there, after they couldn’t find sufficient available space in Burbank’s Media District. Leslie said his PacTen team expects to lease space in its new tower to more-traditional commercial tenants, such as insurance and banking companies, as well as to media-entertainment tenants. “Entertainment has clearly been the driving force that has reduced vacancies and increased rents to a point that justifies new construction in Glendale,” Leslie acknowledged. “That sector has accounted for perhaps 60 percent of the recent office absorption in Glendale, and that clearly indicates that there’s a substantial corporate market out there as well.” Leslie, the former Metropolitan Structures executive who oversaw development of the massive California Plaza office complex in downtown L.A., said Glendale’s low office vacancy rate, strong demand and rising rents make this speculative highrise project a solid investment. “We wouldn’t be doing this in downtown L.A. or just about any other Southern California market,” Leslie said. The overall vacancy rate of downtown Glendale’s Class A office buildings is about 5 percent. And commercial real estate consultants have projected that the $29-per-square-foot annual rental rate required to justify new Class A highrise construction will soon be reached. Ned Fox, a principal in the downtown L.A.-based CommonWealth Partners commercial real estate firm, said PacTen Partners’ plans reflect recovery in both the tenant market and the real estate capital market, and likely signal the start of the next wave of local office development. “It’s following a trend that started a year or two ago on the East Coast and has been moving west in reaction to rebounding real estate markets and economics,” Fox said. “We are still lagging here in Southern California, but we will see more development in the dynamic markets, such as Glendale, Burbank and the Westside.” Speculative projects such as the one slated for Glendale represent a “natural progression” for big real estate investment funds, such as Morgan Stanley’s, to move from acquisitions into developments as values of existing buildings start approaching actual development costs, he added. Leslie said the PacTen/Morgan Stanley team “intends to take advantage” of the favorable conditions in downtown Glendale before prospective competing projects get going. With a “solid capital resource” behind the project in the form of Morgan Stanley Real Estate Fund II, Leslie said the development team should be able to attract construction financing on favorable terms with or without any substantial pre-construction tenant commitments. “We hope to have some preleasing by the time we start construction, but we are committed to ordering steel (for the tower’s frame) and going ahead with or without a tenant,” added Jeff Dritley, Century City-based president of the Morgan Stanley Real Estate Fund. “We think the market dynamics are right for a new ‘spec’ building; it’s the right time in the (economic) cycle to do prudent, selective development.” Dritley added that timing was also a consideration in the team’s decision to proceed. “Glendale is a great city to do business in, and we think we can bring a building to market six to 12 months quicker than anyone else,” he added. Leslie said the PacTen/Morgan Stanley team is paying more than the $6 million K. Young paid for the site two years ago when the property included a vacated medical building that has since been razed. But he said the team paid less than the $13 million the previous would-be development team paid back in 1989 when property values were near their peaks. PacTen, technically a Delaware limited liability company, includes Leslie and local real estate veterans Pete Hillman and Dennis Fitzpatrick. The partnership’s name is derived from the fact that all three partners played varsity basketball while attending colleges now in the Pacific 10 athletic conference.

ALLEN/27inches/1stjc/mark2nd By DANIEL TAUB Staff Reporter Say Beverly Hills, and images of palm trees, Rodeo Drive and mansions spring readily to mind. Say Hollywood , and it’s easy to picture the Mann Chinese Theatre, the stars on the Walk of Fame and, of course, the Hollywood sign. But what comes to mind when someone says San Fernando Valley? Bill Allen wants you to think of movie studios, gourmet restaurants and a convenient airport- but he acknowledges that those may not be the first images that come to mind. “The problem is that the Valley’s image is undefined,” Allen said. “A lot of people have very positive images about the Valley but the business definition is very unclear.” The challenge, Allen said, is for the area’s businesses to work together to develop an easily accessible image for a very diverse area. “We need to try to develop a simple, clear vision for what the Valley is and where it’s going,” he said. A former MTM Entertainment and CBS Television Network executive, and the son of entertainer Steve Allen, Allen was hired last month as the first president and chief executive officer of the Valley Economic Alliance. The non-profit organization, formed in the aftermath of the 1994 Northridge earthquake with seed money from Los Angeles Mayor Richard Riordan’s office, is charged with promoting the Valley as a desirable place to do business. Allen, who is drawing an annual salary of $180,000, will head up the alliance’s numerous programs, including assistance to small businesses, government relations, educational programs and retention of businesses considering leaving the Valley. But perhaps the biggest challenge Allen faces is coming up with an image for the Valley and selling it as a place where businesses should relocate. “We hope to really develop an image of the San Fernando Valley that is marketable as a brand,” he said. Allen, 39, has been working since last summer on the alliance’s Valley image task force, along with Jane Boeckmann, publisher of Valley Magazine. Among the marketing efforts being developed by Allen, Boeckmann and others are informational kiosks to be placed at Burbank Airport and Los Angeles International Airport, an annual report about the Valley’s demographics and economy, and a glossy magazine promoting the Valley’s businesses, cultural activities and recreational attractions. “It will be the kind of first-class publication that L.A. or California puts out every few years,” Allen said. Other marketing tools already completed or in the works include a 10-minute videotape, a World Wide Web site, and freeway signs that would let drivers know when they enter the San Fernando Valley. Those types of marketing tools are needed, he said, because no one else in the city including the city-funded New Los Angeles Marketing Project is doing much to promote the Valley. “I would defy you to find much information about the San Fernando Valley in NewLAMP’s marketing efforts,” Allen said. “I’m not sure there was even one frame of film of the San Fernando Valley in their (television) commercial.” David W. Fleming, chairman of the alliance’s board, said the group’s marketing effort was also needed because none of the Valley’s other major business groups was devoted to that purpose. The Valley Industry and Commerce Association serves as an advocacy group for small to medium-sized businesses; the Valley Economic Development Center is designed to lend money to businesses; and the United Chambers of Commerce of the San Fernando Valley is an umbrella organization for local chambers, Fleming said. “The whole purpose of this thing is to bring all these organizations together, first of all to help recovery from the Northridge earthquake, and to retain businesses and attract new businesses, thereby expanding the economy of the region,” Fleming said. Fleming and Allen said the biggest task initially is raising enough money to fund the type of marketing and educational programs they envision the alliance providing. The alliance has a goal of raising $7.5 million by the end of the year. So far, it has raised more than $2 million, including a $500,000 contribution over the next four years from the Daily News of Los Angeles and a $90,000 commitment from the Los Angeles Department of Water and Power. Universal Studios Inc., Pacific Bell and Atlantic Richfield Co. have also given money. Allen whose family will be donating office space to the alliance, likely to be based in Van Nuys doesn’t expect fund-raising to occupy most of his time. “I think fund-raising will be a short-term priority,” he said. “We’re really looking for investments from the community that will pay off in dividends in coming years.” Allen said he has been speaking to hundreds of business leaders in order to develop an image for the Valley an area with 60,000 businesses that include health maintenance organizations, manufacturing plants, mom-and-pop restaurants and movie and television studios. Allen said the alliance will likely focus on the studios, given their high profile, Allen’s own background and the fact that the entertainment industry is the Valley’s top employer. Allen said people from outside the area still envision Hollywood as the film and television capital, without realizing that Walt Disney Co., Warner Bros., Universal Studios Inc., NBC Studios and CBS Studios Center are all in the Valley. “There are so many shows filming here,” Allen said, noting that two of the nation’s most popular sitcoms, “Seinfeld” and “Home Improvement,” are taped in the Valley. John Rooney, president of the Valley Economic Development Center and vice chair of business development for the alliance, said he is hopeful the alliance will give the Valley control over its economy. “We need to have control of our own destiny,” Rooney said. “It supports and enhances what is already being done locally.”

persfi/25″/april/sfvbj/mike1st/mark2nd By MEL POTESHMAN Personal Finance Tax planning should be a year-round activity. However, if you didn’t get around to doing all you had hoped, it’s not too late to improve your tax situation. The key is to do a thorough job of identifying deductions so you don’t miss opportunities to save tax dollars. To help you get through this year’s returns and to prepare for next year you may wish to consider the following list of Do’s and Don’ts for making the most of deductions available to you. Do deduct interest you pay on home equity lines of credit. Although personal interest is no longer deductible, you may deduct interest on up to $100,000 of debt secured by your house, regardless of how you use the money. Do deduct all state and local taxes you paid in 1996. Also, if you bought or sold a house, be sure to deduct the portion of the year’s real estate taxes you were charged on your closing statement. It’s easy to miss this deduction because you don’t write a separate check the taxes are deducted from the sales proceeds or included in the amount you pay at settlement. Do deduct investment interest. If you borrowed money to buy investments, the interest is deductible as investment interest limited to the year’s net investment income. Do claim a deduction for transportation costs and out-of-pocket expenses you incur in connection with charity volunteer work. The cost of mileage, telephone calls, and supplies, such as stationery and stamps, are all deductible. If you failed to keep track last year, start a tax-deduction diary this year. Do deduct your health insurance premiums if you are self-employed. For 1996, you may deduct 30 percent of the premiums you paid. This amount will increase to 80 percent over a 10-year period. The deduction is treated as an adjustment to income, so you get the tax benefit whether or not you itemize. Keep in mind that the deduction is limited to the earned income from your business. Do deduct half the self-employment tax you pay if you are self-employed. This amount is also deductible as an adjustment to gross income on your Form 1040. According to the IRS, this is one of the most frequently overlooked tax deductions. Do deduct early withdrawal penalties when you cash in a certificate of deposit or other time deposits before maturity. You can deduct the penalty even if you do not itemize your deductions. Do claim a child care credit if you paid someone to take care of your dependent child so you could work. Depending on your income, a credit percentage of 20 to 30 percent applies to your expenses of up to $2,400 for one dependent child and $4,800 for two or more dependents. The credit is reduced for higher-income earners. Don’t deduct reimbursed expenses. Medical, casualty loss, and business expense deductions are not allowed when the costs are reimbursed to you by your insurance company or employer. Don’t overpay the tax due on your mutual fund profits. If you participated in a dividend reinvestment plan, be sure to increase your cost basis by the amount of dividends that were reinvested. Increasing your basis reduces your taxable gain. Don’t forget to take a deduction for used clothing and other property you donate to charity. The fair market value of old clothes, furniture, household items, and books that you give to charity is deductible. Just be sure to have a receipt from the charity to substantiate your donation. Don’t assume that your miscellaneous expenses are not deductible. Although tax law allows you to deduct only those miscellaneous expenses that exceed 2 percent of your adjusted gross income if you itemize your deductions, it is often easier to reach this threshold than you may originally think. Take the time to total unreimbursed employee business expenses like dues to unions and professional associations, tax preparation advice, and investment-related costs, such as investment advice, IRA or Keogh custodial fees, and safe deposit rentals for boxes used to store investment-related documents. Avoid Disputes With the IRS When preparing your tax return, accurate documentation, good faith intentions to meet your tax responsibilities, and a clear understanding of the tax law can make all the difference in disputes with the Internal Revenue Service. There are no excuses for not knowing the law. Distributions from individual retirement accounts are taxed in the year you receive them. However, if you roll over withdrawn IRA money into another IRA account within 60 days, the distribution is not taxed. Miss this deadline and you’ll be required to pay the requisite tax, as well as a possible penalty if you make the withdrawal before the year you reach age 59 and a half. One man discovered this fact the hard way. Because his investment advisor and employer provided conflicting advice about IRA rollovers, he failed to complete the rollover within 60 days. The result: He had to pay taxes on his distribution and was subject to a premature withdrawal penalty. Did you know that the IRS helps underwrite some parties? Entertaining for business is not unusual. As long as you discussed business during, immediately before, or immediately after the event, 50 percent of the expense is typically deductible. Conducting parties at home for customers or potential clients may also fall into this category even when the deduction is for hundreds of thousands of dollars. One couple held a dinner party, replete with a nationally recognized performer, for their sales associates and potential customers. Employed in the home-building business, the taxpayers claimed a $347,000 business-related entertainment expense on the basis that the party was designed to promote the houses. The IRS objected, but the federal tax court ruled in the taxpayers’ favor, noting that there was no personal relationship between the taxpayers and their guests and the fact that the sales of their houses tripled in the years since they started throwing parties. Mel Poteshman is a certified public accountant and president of Poteshman Consulting International & Co. a West Los Angeles-based business consulting firm.