Google's New Venice Beach Office Poised to Jumpstart Real Estate Market
The opening of offices by the Internet giant (and some recent high-end sales) have many hoping for a Silicon Valley-style upswing.
In these endless days of stasis for the residential real estate market, it seems that everyone is searching for a silver lining to news of mounting foreclosures or rising inventories of unsold houses. But in Venice, where Google just opened new offices that house more than 500 employees, there is some honest-to-goodness hope for real estate agents who've long sought silver linings.
Indeed, the search engine behemoth's November move from Santa Monica to Venice -- where it is leasing more than 100,000 square feet in three buildings on Main Street -- has brokers preparing for a reinvigoration of the housing market. While Google's relocation is expected to lead at least some employees to purchase property in Venice, perhaps more importantly, brokers and others say that the company's choice of location there is spurring others to consider the beachside community. "It's what we call the clustering effect; the Google name leads others to the area," says Kimberly Ritter-Martinez, associate economist for the Los Angeles County Economic Development Corp. "It will eventually attract like-minded and similar types of businesses -- and you hear so much talk about living close to where you work."
Mountain View, Calif.-based Google isn't the only tech or media firm that has gravitated to or solidified roots in the area. This summer, ad agency Zambezi Ink, owned by Kobe Bryant, moved into new offices on Westminster Avenue. In April, actor-director Jon Favreau paid slightly less than $2 million for a three-story commercial property on Abbot Kinney Boulevard that he leases to a postproduction firm. Robert Downey Jr. purchased a building in the same area in 2009 for $5.6 million. And both Facebook and Yahoo maintain offices nearby in Playa Vista and Santa Monica, respectively, positioning the Westside as a tech hub. Several entertainment industry players also have bought or sold residences in Venice in recent months. In September, Incubus frontman Brandon Boyd bought a three-bedroom house a block from Abbot Kinney for $2.715 million. (He's also listed a residence on Navy Street for $3.495 million.) In May, actress Olivia Wilde sold a 3,000-square-foot residence on Crescent Place for $3.095 million and former KCRW-FM music director Tom Schnabel sold a modern house on an Altair Place double lot for $2.9 million in August.
That same month, Payam Shohadai, co-founder of visual effects firm Luma Pictures, purchased a Marco Place property for $2.045 million. Luma -- which has worked on films such as The Avengers, Captain America and The Green Hornet -- is based in Santa Monica, and Shohadai decided to move to Venice from the Miracle Mile area to be closer to his office. And it didn't hurt that Google and other similar companies have moved there. "Since they are my sort of people -- creative technology -- that's a bonus for me," Shohadai says. "There's definitely a creative class of people and professionals that are making good money, but it feels very nontraditional."
So far, data that proves Google's impact in Venice is scant. Brokers say that they have shown houses to prospective buyers who work for the company, but none interviewed by The Hollywood Reporter has sold a property to a Google employee. (There's no word on co-founders Larry Page and Sergey Brin casing the area for residences.) And data from the Multiple Listing Service shows that the Venice market essentially is treading water: The number of single-family-house and condominium sales is up slightly in 2011 compared with last year, but the median price of properties sold is down. But real estate agent Sandra Miller of Engels & Volkers, who represented Shohadai in his purchase, says that despite the stagnant market, deals can be made if sellers are motivated. "And if the seller is a real seller, the buyer can get a deal," says Miller, who also has the listing on a compound owned by Anjelica Huston.
Google is known to locate offices in areas where there is room for growth. And the company is hiring, though a spokesman would not comment on how many people it plans to bring aboard at the Venice office, which is partly housed in architect Frank Gehry's iconic Binoculars Building (it is named for the adjoining oversized sculpture created by Claes Oldenburg and Coosje van Bruggen). Earlier this year, the company said it would add 6,000 workers overall in 2011, and Coldwell Banker agent Todd Baker is hopeful that Google will bring more employees to the area. "That will translate into greater demand for homes and more buyers. Every market needs a kick," he says. The company's new Main Street property was previously occupied in part by Digital Domain, the visual effects and animation firm co-founded by director James Cameron, and now houses Google software engineers and sales representatives. (Digital Domain retains offices nearby in Venice.)
For years, Venice worked to shake off a reputation for gang violence and drug dealing that tempered enthusiasm for its artist-friendly vibe. Things changed in the past decade with the emergence of Abbot Kinney as a bastion for haute cuisine and boutiques such as Jack Spade and Mona Moore (think $1,000 Martin Margiela boots). In 2008, the community welcomed a Whole Foods megastore, but some residents boycotted the 2007 opening of a since-shuttered Pinkberry outpost. Google has not been met with resistance, perhaps because it was relatively open about its plans, discussing them, for example, at a Venice Neighborhood Council meeting. "Normally, Venice people don't like big companies, but absolutely Venice has embraced Google," says real estate agent Tami Pardee, who specializes in the area. "It has brought people who say, 'Wow, Google is there; it must be a good place to live.' "
But for some, the idea of Venice as a haven for tech companies is out of step with the bohemian enclave's character. Longtime Venice architect David Hertz, who is remodeling Shohadai's house, cautions that the community shouldn't be "yuppiefied." While he's a supporter of growth, he hopes the area can retain its grittiness as it evolves. "I don't think Venice was better when there were prostitutes and crack houses, but I think it is really a vital community of eclectic cultures and socioeconomic brackets, and I don't want to lose that original Venice feel."
VENICE BY THE NUMBERS: Although brokers are hopeful for an uptick in sales, the market for single-family houses and condos remains flat in the 90291 Venice ZIP code, according to Multiple Listing Service data.
Residences Sold (Media Price)
- 2010: 189 ($950,000)
- 2011: 194 ($900,000)
UPDATE: One Year Later
The premiere issue of The Hollywood Reporter magazine checked in on the residences of two of Venice's most famous folks: Anjelica Huston and the late Dennis Hopper. Back then, both of their compounds were for sale, and they remain on the market about a year later. The imposing Huston residence, first listed in May 2010, has been reduced from $18 million to $14 million. The five-story, 13,796-square-foot Windward Avenue property, designed by the actress' late husband, sculptor Robert Graham, is still Venice's most expensive listing. Seller's agent Sandra Miller says that there's an interested party. The eclectic Hopper compound, listed in July 2010 for $6.245 million, has been reduced to $5.75 million. The Indiana Avenue property includes three condos designed by Frank Gehry. Although both residences boast celebrity and architectural pedigrees, agent Todd Baker says they are anomalies suited only to "very unique buyers."
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