Title	Downtown firms make most of warehouses
Date:	4/8/2001
Author:	MARK VAN DE KAMP
Source:	Santa Barbara News Press

In the 1920s, workmen labored to unload freight trains of produce, furniture and bolts of cloth, moving the precious cargo into warehouses along Santa Barbara's lower Eastside. Uptown, movers emptied vans of beds, musical instruments and tables into cavernous storage buildings.

Eighty years later, these aging warehouses stand as a testament not only to Santa Barbara's industrial history but also to its high-tech future.

Eager for locations in or near downtown, many software companies have chosen to recycle old warehouses into very modern uses.

The trend makes economic sense. Downtown's vacancy rate is about 2 percent, land costs are sky-high, there's barely any vacant land left, and renovating is cheaper and much faster than erecting a new building. With the South Coast facing growth constraints, experts say less and less new commercial and industrial development will occur.

The transition also helps preserve at least the exteriors of some historic buildings.

"I love 'em. These old buildings have character," said Neal Graffy, a Santa Barbara historian. "Any time that they can keep an old building alive is great. They leave the outside alone, but inside they re-insulate, install cables and make it a different world."

Alias/Wavefront, Miramar Systems, Push, Santa Barbara Technology Incubator, Openwave and other companies --including Level3 Communications, which is laying a fiber-optic cable up the coast as part of its international network -- have set up shop in old warehouses where architects and developers have worked magic.

Hundreds of people are again working downtown in these dramatically remodeled interiors replete with brightly colored walls, potted ficus trees and plenty of natural light coming through open trusses.

Architects have made sure not to stuff employees into "cubicle farms" as in the Dilbert comic strip. People work in open rooms at modern workstations, separated by curved privacy screens but linked by high-speed Internet lines.

Near the beach and behind a T-shirt store, a former moving and storage warehouse that by some accounts was built in 1911 now houses an 80-person software development company.

"I really like the open floor plan and all the natural light in here," said Todd Mogk, who works upstairs testing software at Miramar Systems, 10 E. Yanonali St. "It makes for a much more cohesive work team. It's a fun place."

Miramar moved in two years ago. Senior vice president Harry Rabin said the growing firm wanted more space and a downtown location. To achieve those goals, architect Valerie Froscher blended old with new. The 20-year Santa Barbara resident and principal architect of the project designed the 25,000-square-foot interior around the building's massive cast-concrete columns, which were sandblasted clean. She also kept the original first-floor vault, which had been used to store valuables.

"They took over an old warehouse that Big Dog had formerly used, and recycled it for a new use," Froscher said. "We did the retrofit in two phases and finished the second floor early last year. Now they've bought the building."

Open ductwork snakes high above the first-floor rooms. Interior walls are painted purple, blue, brown, red and green. An acoustical engineer helped Froscher to muffle sound from the railroad tracks that parallel the building.

"I like the way they incorporated the columns and windows and put in the wood," said Janet Ames, Miramar's controller. "The extra-high ceilings are nice. And we're very close to a lot of eating establishments, and to the beach if we want to take a walk."

On the other side of the railroad tracks stands the white, blocky building that formerly housed Bekins Moving and Storage Co. Bekins put its 58,000-square-foot warehouse complex at 25 E. Mason St. up for sale in 1982 after more than a half-century at the location. Today the building has a new life. Young Construction of Santa Barbara redid the interior for Push, a local software company. Last year, the young high-tech firm signed a five-year lease on the building, next to the railroad tracks on the east side of State Street across from the Californian Hotel. The application-hosting company provides customers with software services over the Internet.

"It's a great building with lots of natural light and an open floor plan," said Dayna Birkley, vice president of business development. "We're really happy here since moving in last summer."

Also last summer, Lyon Van and Storage Co. moved from downtown Santa Barbara to new digs in Goleta. It needed a taller building in which to stack people's belongings.

Now the distinctive building at 27 East Cota St., built in 1922 with a five-story addition from 1926, is occupied by a collection of telecommunications companies.

The latest warehouse renovation is at 402 E. Gutierrez St. The 26,000-square-foot space is the new quarters of Santa Barbara Technology Incubator. The company coaches a bunch of startups that have earnings potential in exchange for little pieces of equity in all of them, hoping that one or more hits the big time.

DesignARC, a local architectural firm, made use of the building's high, arched ceiling and open trusses. Michael Holliday, principal architect with DesignARC, said the challenge was to recycle the old building to incorporate the new.

Young Construction has been in the thick of these conversions. Co-founder and president Bob Young said his firm did the Miramar, Push and incubator projects, and now is renovating the old Firestone garage at Haley and Chapala for Openwave -- the company that resulted from the merger of Software.com and Phone.com.

"It's been a lot of fun for us. These companies are looking for ways to attract people, and it's often through design, with colors, different materials in these warehouses," Young said. "We've been able to do it with fairly simple building materials and end up with these cool designs. It's hard to recreate that old brick or the cast concrete; these are unique opportunities, and I really like recycling the old into the new."

There's no tally available of the converted square footage, but it's a big number.

Two massive warehouses on Calle CŽsar Ch‡vez, just a few blocks from East Beach, have been refurbished into homes for Channel Paper Co. and Calvary Chapel Church. One of them, the historic Vercal building, is the largest in Santa Barbara at 230,000 square feet. It now houses DesignARC, Calvary Chapel Church and other tenants. Next door, the other remodeled warehouse houses Channel Paper Co., a longtime local business. Both buildings used to be lemon-packing plants.

When a former car dealership's building at 614 Chapala St. went on the market a few years ago, a new software company jumped at the opportunity. Erected in the 1940s, the place housed Washburn Chevrolet, which over the years sold Fords, Chevys and Jaguars. Jordano's was there for a few years, too.

Since 1996, the place has been home to Alias/Wavefront, originally a Santa Barbara company that's now part of Silicon Graphics in Mountain View. Alias/Wavefront develops animation software for movie makers, game developers, television networks and industrial designers.

"When I found the property was available in 1995, I remember walking in with new eyes and wondering if we could turn it into a software shop and turn it into what people called an office of the future," said Mark Sylvester, who co-founded the company.

Where mechanics used to fix car engines inside the 15,000-square-foot building, software wizards are writing programs used to create special effects in feature films such as "Star Wars," "Hollow Man" and "The Perfect Storm."

There are no windows on the ground floor in back, but the building does have eight-foot-tall windows along one wall for almost 100 yards, Sylvester said. Lots of bamboo, trees and orchids give a soft touch to the building and "bring the outside inside," he said.

"It helps in recruiting, and to help reinforce our brand in the mind of our customers," he said.

Vividly colored walls are also a big feature in the former showroom at the front of the building.

Sylvester says that when discussions about colors bogged down during the remodeling, he walked across the street to a paint store and quickly picked out interior colors that matched those on his beachball.

A big part of these high-tech companies' motivation is their strong desire to be downtown, where all the action is, said Bob Tuler, vice president of Pacifica Commercial Realty.

"There's a shortage of vacancies overall in the downtown area, so these warehouses are attractive options," Tuler said. "When upgrades are made, they do high-quality improvements."

New commercial and industrial development is becoming scarcer on the South Coast, experts say. This year and the next two will probably see the last big commercial projects in the Santa Barbara-Goleta area for a long while, according to both veteran real estate broker Stephen Hayes and longtime economist Mark Schniepp.

A great deal of space has been claimed within the past five years in Goleta's business parks by nearly 20 huge corporations, Hayes said, following those conglomerates' acquisition of numerous local companies, mostly in high-tech fields. Those corporations, occupying about 700,000 square feet in Goleta, include AT&T, Adept Technologies, Cisco Systems, Cree, Du Pont, Ericsson, Intel, Microsoft, Texas Instruments and TRW, among others.

Some of their floor area was converted from defense-industry space that became vacant less than 10 years ago. There's also been a lot of new office building.

In contrast, Santa Barbara is largely built-out. Vacant land is almost nonexistent.

"There's a lot of benefits when people make use of existing buildings," said Bettie Hennon, city planner. "From a community planning standpoint, there's also a question of balance when it's market-driven."

The City Planning Commission and City Council want planners to examine the scope of warehouse renovations and the overall impact on light manufacturing uses, she said. The goal is to encourage both traditional light industrial uses and newer uses such as high-tech, without seriously disrupting the building inventory one way or the other.

There are more warehouses still in traditional use, Young said, but a lot of them have been gobbled up. Judging from the recent conversions and continuing tight vacancies, interest is expected to remain strong.