Gaslamp Quarter Property Owners Grab Premiums to Turn Buildings Into Billboards
Pop culture festival Comic-Con International is a little bit like Christmas come early for downtown San Diego property owners: Media companies and other vendors pay as much as triple the average retail rates for temporary installations tied to the global celebration of sci-fi and superheroes.
Several property owners in downtown’s popular and historic Gaslamp Quarter, located directly across the street from San Diego Convention Center where the event is held, have garnered some of their highest rental rates and revenue of the year for properties during Comic-Con, as companies and vendors seek to grab the attention of visiting downtown crowds with interactive pop-up installations.
Local commercial broker Athena Harman, at brokerage Harman Realtors, said a property that her company represents in the 300 block of Fourth Avenue was leased by New York-based event planning firm Civic Entertainment, on behalf of a division of D.C. Comics, for July 18-22, the span of this year's festival. That pop-up took 5,134 square feet for $55,000, or $10.71 per square foot, just for those five days.
CoStar data shows the current normal average monthly retail rent for downtown San Diego is $3.26 per square foot, above the San Diego average of $2.46, though local brokers note that the high-demand Gaslamp Quarter, because of its year-round popularity with visitors and locals, can often command retail rents up to $5 or $6 per square foot depending on location and permitted uses like alcohol sales.
Tony Franco, principal in San Diego-based commercial brokerage Franco Realty Group, who represents clients in several neighborhoods including the Gaslamp Quarter, said demand for Comic-Con can send those prices even higher.
"It’s like if you own a vacant lot, and you rent it out for a holiday season, maybe the tree lots during Christmas or the pumpkin sellers during Halloween," Franco said. "Those properties have realistically gotten two or three times the usual rents."
For instance, a recent check of the listing service LoopNet, which is part of CoStar Group, shows that several Gaslamp property owners, during April and May, put their storefront retail spaces on offer before Comic-Con for potential use as event pop-ups for the month of July.
While most listings said rent was negotiable and did not specify a price, there was one 10,934-square-foot space at 345 Fourth Ave. with an asking price of $85,000 for the month, or $7.77 per square foot. Another 2,621-square-foot space at 343 Fourth Avenue had an asking price of $35,000 for the month, or $13.35 per square foot.
Harman, whose Harman Realtors represented both spaces, told CoStar News they did not have takers as of July 19, but the larger one was leased during last year’s Comic-Con for $80,000, or $7.32 per square foot. It was leased to Civic Entertainment, which in turn was representing animation studio Laika, known for stop-animation feature films including "Coraline" and "ParaNorman."
Harman said her company represents owners of three Gaslamp Quarter properties dating back to the 1880s, and Comic-Con pop-up demand for space in those and other neighborhood buildings has been rising steadily over the past decade, though that demand was down slightly this year from 2018.
In addition to paying rents, Harman said the New York and Hollywood production companies are often willing to invest thousands of dollars more in city permit fees and significant upgrades, including installing temporary walls that make the vintage spaces resemble film sets. One past user even paid tens of thousands of dollars to install a city-required fire-suppression system, which remained in the building long after Comic-Con left town.
"These production companies are in the business of creating fantasy worlds in a studio, and setting up and tearing down these temporary spaces is something that they do all the time," Harman said.
Article Source: Lou Hirsch, CoStar
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