Southland Industries Adds in Garden Grove

Real Estate: Contractor takes Money Mailer’s old headquarters
By Mark Mueller | October 16, 2017

Southland Industries, one of the country’s largest mechanical, electrical, and plumbing systems contractors, is stepping up its presence in its home of Garden Grove.

The privately held company, which has a long history in Orange County, signed a lease this month to occupy all of a recently upgraded, 207,953square-foot industrial and office building at 12131 Western Ave.

It’s one of the largest leases in North OC this year, and takes one of the biggest empty buildings in the region off the market.

The 9.6-acre property is a few blocks north of the Garden Grove (22) Freeway near the intersection of Western and Chapman avenues. It previously held the headquarters of Money Mailer LLC, which vacated it a few years ago after downsizing operations.

The building’s current owner, Rexford Industrial Realty Inc. in Los Angeles, has overseen a large renovation of the site since buying it last year from Newport Beach based CT Realty Investors as part of a larger portfolio deal.

Upgrades include creative-office flourishes to the nearly 50,000 square feet of office space, plus a new facade and an enlarged parking lot.

Southland Industries is scheduled to move into the building around December under a 10-year lease, according to Clyde Stauff, senior executive vice president for the Irvine office of Colliers International.

Stauff represented Rexford in the lease along with Colliers Executive Vice President Michael Hartel and Voit Real Estate Senior Vice President Mike Bouma.

Keeping the company in the city is “a big win for Orange County,” Stauff said.

Mike Wiley, corporate managing director at the Newport Beach office of tenant brokerage Savills Studley, represented Southland Industries in the lease.

The property was being marketed for 76 cents per square foot, per month, according to Voit’s marketing material.

Tofu Takeover
The new lease is a step up in space for Southland Industries, whose current local offices in Garden Grove, about a mile from the Western Avenue property, total about 120,000 square feet.

The company provides mechanical engineering and other services for large construction projects, hospitals and universities being among other clients. It employs about 500 people in OC and did nearly $400 million in sales here last year, per Business Journal data, No. 47 on the largest private companies list.

Notable projects it’s working on include the new soccer stadium for the Los Angeles Football Club in downtown Los Angeles, according to Southern California Division Leader Payman Farrokhyar.

The Western Avenue facility, featuring new equipment, will offer the company a “forward-looking” space for its design-build facilities, with plenty of room for interdepartmental collaboration, and allow for more growth, Farrokhyar said.

“We’ve been aggressively hiring” recently to support the company’s Southern California operations, he said. “This market has been doing really well.”

The company’s also nearing a lease for a new retail location in downtown L.A.

The Business Journal reported in August that House Foods America Corp., a Garden Grove-based manufacturer of tofu, noodles and other Asian-influenced food products, bought a building in the city that Southland Industries had occupied, an 83,000-squarefoot office at 7421 Orangewood Ave.

House Foods paid about $17.5 million for the property, which sits next to its headquarters and local tofu manufacturing facilities, with plans to expand area operations.
Southland had leased the building on Orangewood, but it owns another, smaller office nearby at 7390 Lincoln Way.

The company lists its headquarters as being at the Lincoln Way building, and it has much of its corporate operations in Garden Grove, although some of its executive team is based in the Washington, D.C., suburbs.

It moved its Southern California operations and headquarters from Irvine in 2012.

The Western Avenue facility will be the Southern California division of Southland, while corporate offices will remain at the Lincoln Way building, according to Savills Studley’s Wiley.

The company had been looking at facilities outside of the area for a potential move, including sites in the Inland Empire, before inking a deal to stay in Garden Grove, he said.

“Their preference had been to stay in North Orange County.”