Case Study

Client: NOIR Furniture
Property: Single–tenant industrial building, 46,770 SF free standing building, Gardena, California

Transaction: Acquisition purchase. Gary Blau was the buyer’s agent in the acquisition of an adjacent property contiguous to the client’s existing corporate headquarters building.

Summary: Over the years NOIR furniture acquired neighboring (but not contiguous properties) that facilitated their expanding business operations as they became available.

Challenge: Purchase the property contiguous to NOIR’s corporate headquarters at fair market value. The targeted acquisition property was owned by a property owner who wanted $132 PSF for the property which was at the time, fairly valued at substantially less. The owner of the targeted acquisition property was well aware that NOIR desired to purchase his property for its expansion needs and believed he could achieve a substantially “over market” price by negotiating directly with NOIR. In fact the adjacent property owner and NOIR had preliminary discussions regarding the adjacent property.

Solution: NOIR appointed Gary Blau as its buyer’s rep to negotiate the acquisition of the adjacent contiguous property and broke off communication with the adjacent owner. Gary educated his client NOIR as to the current fair market value of the adjacent property and recommended a strategy for negotiating with the adjacent owner. Gary recommended that he prepare a written purchase offer based on the fair market value of the property and submit it on NOIR’s behalf to an industrial real estate agent that the adjacent property owner had used in the past to sell his other properties. In this way Gary successfully communicated to the adjacent property owner 1) that NOIR was not going to pay over market for the targeted property, 2) that NOIR had other options to expand its business by purchasing other neighboring properties, and 3) that time was not of the essence.

Result: NOIR was able to acquire the adjacent property for its expansion needs for $103 PSF, saving itself approximately $1,300,000 easily justifying the brokerage fee paid to Gary for his brokerage/consulting representation. NOIR was able to execute its ambitious growth plan five-fold. With this built in, next-door expansion capability, the company was able to grow its operations without relocation’s. Gary has represented NOIR and its subsidiary companies with the purchase and sale of five buildings in the last 3 years.


Case Study:

Client: Apparel Ventures

Property: 61,000 SF single-tenant free standing industrial building, Gardena, California.  See attached brochure.

Transaction: Lease Negotiation-Gary Blau was the tenant representative broker for the negotiation of the option term of an existing lease

Summary: In the mid-1990’s, the Los Angeles economy was in recession and industrial real estate rental values had fallen dramatically from the late 1980’s from when the Apparel Ventures warehouse/distribution building lease was newly signed. After interviewing several Gardena industrial real estate professionals, Gary Blau was given the assignment of negotiating a lower rental rate for the option term of Apparel Ventures’ lease based on a lower current market rental value than when the lease was originally signed.

Challenge: Help this apparel company take advantage of the drop in rental values, and reduce rental costs for the option term of its existing lease. The lease called for the option rent to be calculated based on current fair market rental value at the time the option term was exercised. This meant convincing the landlord to accept a large reduction in rental income during the second five year term of the lease.

Solution: Apparel Ventures had excellent credit and had been a model tenant in the building for the past five years, always paying monthly rent on a timely basis. At the time of the renewal negotiation there were many building vacancies in the greater South Bay area. Gary held numerous meetings with the landlord, highlighting Apparel Ventures’ excellent credit, the then existing vacancy rate in Gardena as well as educating the landlord as to current market rental values as compared to the higher rates in effect when the lease was originally signed. Gary guided the landlord to acknowledge that a vacancy in his building could result in a long vacancy and a high cost to re-tenant his building.

Result: Apparel Ventures was able to reduce its rental costs over its five year option term by approximately 35%. Gary Blau since represented Apparel Ventures in three additional lease and sale transactions before Apparel Ventures was eventually sold to Manhattan Beachwear. The landlord of Apparel Ventures’ old warehouse/distribution building was impressed enough with Gary’s negotiating acumen that when Apparel Ventures eventually vacated his building at the end of the option term, and it came time to sell the property for estate purposes, he hired Gary as his exclusive agent to handle the marketing and sale of the building.