Koll green lights move from Newport

Paul Clinton

The developer of one of Newport Beach’s most well-known commercial

complexes, Koll Center, is packing up its local headquarters and

leaving town.

Koll Development Co., based at a Von Karman Avenue office for

almost two decades, is in the midst of a restructuring that will move

the headquarters to Dallas by April, as the company’s focus shifts

away from risky, highly speculative office projects.

Such projects had been the company’s specialty for the nearly 40

years it was run by founder and longtime Newport Beach resident Don

Koll, who resigned in early 2001. Koll, who now lives in Los Angeles

but still owns a home on Balboa Island, spearheaded the “spec”

development of the center that now bears his name.

The company, now led by president and chief executive Steve Van

Amburgh, will chiefly design and construct “build-to-suit” projects

for specific corporate clients.

“It’s clearly a change in corporate philosophy,” said Mike Parker,

who heads Koll’s western division. “We have gone from being a local

entrepreneurial [real estate] expert to a national corporate services

producer.”

The 38-year-old Parker, who graduated from Corona del Mar High

School, was promoted to his post in October.

By building custom office complexes for specific corporate

clients, Koll is now charting a more conservative course than it did

in its freewheeling past, when the company’s office projects popped

up in Newport Beach and Irvine without inked deals from tenants.

Demand for office space in Orange County has dried up over the

past several years, with the district surrounding John Wayne Airport

hit hardest. Vacancy rates in those areas of Costa Mesa, Newport

Beach and Irvine hit 8.3% in the third quarter, according to a recent

survey.

This trend has slowed office development and led to Koll’s

decision to scale back.

Employees from the Newport Beach headquarters will either be laid

off or shifted to other regional offices, Van Amburgh said. The

company will lease out its 80,000-square-foot former headquarters in

Newport Beach, while keeping a foothold in Orange County with an

Irvine office.

Late last year, the company completed an eight-story,

178,000-square-foot office complex called Koll Center Irvine North

that will partly serve as the regional office. The remaining space

has been leased to Salomon Smith Barney, G.E. Capital and others.

Koll, who founded the company in 1962, resigned last year. He

presided over the breakup of the Don Koll Company in the late 1980s

and early 1990s. Koll Development was spun off as a public company,

known as Real Estate Group. Company officials later bought back all

the public shares in 1999, taking the company out of the public

realm.

Other divisions of Koll, including Koll Construction, continue to

operate as separate entities.

Mayor Tod Ridgeway, a developer who has built shopping centers in

Orange County and Northern California, said the move wasn’t

unexpected in light of the weak commercial market and the company’s

broader development strategy.

“It’s not very surprising,” Ridgeway said. “It was an institution

of an earlier time.”

Plans to expand the Koll Center hit the skids last November, when

voters rejected the company’s bid to add a 10-story,

250,000-square-foot office tower in the first test of the slow-growth

Greenlight law.

* PAUL CLINTON covers the environment, business and politics. He

may be reached at (949) 764-4330 or by e-mail at

paul.clinton@latimes.com.