Lockheed Property Will Be Put Up for Sale : Real estate: Finding a buyer for the defense giant’s former headquarters will likely be difficult, due to a weak market and internal factors.

CALABASAS —  As the historic merger of Lockheed Corp. and Martin Marietta Corp. was being finalized last Wednesday, creating a Gargantuan defense concern with $22 billion in annual revenue, some of the 250 employees at Lockheed’s former headquarters in Calabasas were packing their bags for their move to a new corporate home in Bethesda, Md.

The company is now called Lockheed Martin Corp., and about 100 of the 250 corporate staff people in Calabasas have been given layoff notices, a spokeswoman said. Those are the first of possibly thousands of the combined Lockheed Martin Corp.’s workers around the country expected to be pink-slipped in the aftermath of the $10-billion merger. The company is now the largest in the U.S. defense industry.

Lockheed’s departure from its 326,000-square-foot building in Calabasas will be completed over the next several months. That means a big chunk of commercial real estate will soon be for sale, and while real estate experts see no danger of the property becoming a white elephant, many say that sales efforts could be complicated.

“Its a good site, with an awful lot of advantages,” including the attractiveness of the suburban area, executive-class housing nearby and a large, diverse population in the surrounding region from which to draw employees, said Jim Lindvall, an office properties specialist at the Grubb & Ellis commercial real estate brokerage in Sherman Oaks.

“But there aren’t that many large users to come along,” Lindvall said. “It might take a year or two to find someone who is a match for that property.”

Lockheed finished construction of the building, situated on 40 acres, in 1986, when it moved its corporate headquarters from its longtime base in Burbank. The Calabasas property has not been formally listed for sale yet, said Lockheed spokeswoman Maureen Curow, but the plan is to sell the building once all the employees there have been relocated.

About 90 employees will remain in Calabasas temporarily, but eventually 40 to 50 workers will be relocated to a smaller, permanent West Coast office in the Los Angeles area, Curow said. The rest of the Calabasas workers are moving to Bethesda.

The loss of Lockheed is a blow to Calabasas, which stands to lose an estimated $50,000 a year in utility and room taxes paid by hotel users visiting the company, said City Manager Charles Cate.

“Then there’s a certain cachet or prestige associated with having the world headquarters of such a major company in our city,” he said.

Cate said the city would not offer any financial incentives to another company considering buying the Lockheed property. But efforts would be made to expedite paperwork and accommodate any changes a new owner might want to make to the facility, he said.

Bill Pentz, branch manager at Daum Commercial & Industrial Real Estate in Woodland Hills, said the depressed office market of the past several years could actually help Lockheed attract a buyer.

“It hardly makes sense to build a new building today,” he said. “You can buy an existing property and modify it to your needs.”

Real estate specialists also speculate that Lockheed Martin will set aside reserves to pay for a write-down on the sale of the Calabasas property--a common practice when companies dispose of real estate--and might therefore be willing to sell the site cheap.

The assessed value of the building and land is $65 million, according to Los Angeles County property records. Some brokers estimated that the building is on Lockheed’s books at about $250 a square foot, roughly the cost of building such a facility. They say, though, that a sale price would likely be in the range of $100 to $150 per square foot, or between $32 million and $49 million.

But the big potential stumbling block in the path of a sale, experts say, is that the building is designed for a single tenant. An office building of the same size designed for separate tenants would be more efficient and could house twice as many workers as the 350 that Lockheed was permitted by the city of Calabasas.

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“The Lockheed headquarters is a beautiful complex, architecturally very pleasing,” said Seth Dudley, senior vice president at Julien J. Studley Inc., a commercial real estate brokerage in Los Angeles.

“But the bottom line is they need to get lucky. It is really a corporate headquarters facility, and it would take too much to make it into anything else. On the basis of that, I think they’re going to have a hard time” finding a buyer.

Some other large office projects nearby have had trouble finding tenants in the past few years. The 25-story Warner Plaza III office tower at Warner Center in Woodland Hills got its first tenant last fall after standing empty for nearly three years, but the building remains mostly unused and is the main contributor to a 17% office vacancy rate for the West Valley, which includes Calabasas.

A 140,000-square-foot Newbury Park office building vacated by Northrop Corp. three years ago is still not filled. And Exxon Corp. has been trying to sell a 60,000-square-foot office building in Thousand Oaks for about a year and a half.

Some large corporations are reportedly looking for office space in the area. The mayor of Westlake Village recently said that Dole Food Co., the food and real estate giant, is considering moving its headquarters from his city, where it has 420 employees, to Calabasas and was looking at the Lockheed property. The company had intended to build a new complex in Westlake Village, but those plans have been put on hold. Dole spokesman Tom Pernice said that the Lockheed property is one of several options the company is exploring, but no decision has been made.

Other large companies mentioned frequently in real estate circles as being interested in a large chunk of Calabasas-area office space are Amgen Inc., the Thousand Oaks biotechnology firm, and Cigna Corp., the health-care insurer.

Even so, a property like Lockheed’s could take as long as three years to sell, Lindvall said.

“Beyond that is when it becomes a white elephant,” he said, “and I don’t think this facility could become that.”