Suddenly, Carpinteria is getting a lot of attention.
With business-centric social networking site LinkedIn’s $1.5 billion purchase of online training company Lynda.com, the city is in the limelight.
Carpinteria is made up of just seven square miles and about 14,000 residents, yet companies including Agilent Technologies subsidiary Dako, silicone manufacturer Nusil and restaurant management firm CKE all call it home.
Lynda.com started moving its headquarters from Ventura in 2009, leasing about 60,000 square feet of office and research and development space in Carpinteria.
In August of that year, it furthered its expansion, buying a 31,553-square-foot office building and 25,921-square-foot warehouse building on Cindy Lane. The property was listed for about $6 million and is now a production studio for the company. At the time, the deal was thought to be the company’s last.
Lynda.com “is growing but they’ve already acquired quite a bit of square footage,” Christos Celmayster, a broker with Hayes Commercial Group who worked with the firm to make the move to Carpinteria, told the Business Times in 2009. “They’re probably at a point now where they don’t need any more space in the near future.”
For the most part, that turned out to be true. In 2014 the company sold the 6410 Cindy Lane facility to a local real estate investor and the president of S&S Seeds, Victor Shaff, for $6.1 million. Lynda.com purchased that building for $2.2 million in 2010.
As the smallest commercial real estate market on the South Coast, Carpinteria only needs a few large deals to drive down its vacancy rate, according to area brokers. On the other hand, the loss of just a handful of larger tenants could push the market into the doldrums.
It’s unclear what kind of moves the LinkedIn deal will bring. Company spokeswoman Liz Scanlon said the firm will continue to operate like “business as usual” after the acquisition closes. Lynda.com had about 300 employees in Carpinteria at last count, according to the California Economic Forecast.
Carpinteria has relied on Lynda.com’s expansion to fill space, but with the company’s physical growth maxed out for now, the city will have to look to other large tenants to backfill its empty spots.
In 2013 it looked like Carpinteria had finally put the recession behind it, with the rise of homegrown Nusil and the growth of transplant Lynda.com. CKE Restaurants, the parent company of the Carl’s Jr. and Hardee’s fast food brands, still maintains its headquarters at 6307 Carpinteria Ave. The company was bought by a New York-based private equity firm in July of 2010, but told its approximately 180 South Coast employees that not much would change after the deal.
That didn’t turn out to be true. The company has downsized by about 10,000 square feet since acquisition and the number of South Coast employees has dropped slowly. The last figure release by the company in 2013 put the headcount at 120 employees in Carpinteria. At one point, CKE occupied about 88,000 square feet, or 20 percent of the office market in the city, according Radius Commercial Real Estate & Investment’s 2013 year-end market report.
CKE’s lease ended in March and the company had been negotiating for an extension in the same building, but in a smaller space, a corporate spokesman told the Business Times.
“We are moving a small number of people in key support departments to our Anaheim location to create greater efficiencies and better serve and support our franchisees and company-owned restaurants,” the company said in a statement. “We are not eliminating positions and we are not moving out of California.”
CKE is only looking to extend through March of 2017, the spokesman said. The executive team will remain in the Carpinteria office, but plans beyond then are not definite.
On the upside, Procore Technologies, a developer of cloud-based construction software, signed one of the largest leases on the South Coast last summer. The company filled 33,000 square feet of newly renovated office space at 6185 Carpinteria Ave.
That move came on the heels of a $15 million capital raise from Silicon Valley firm Bessemer Venture Partners. Its headcount has jumped from a half-dozen employees in the depths of the recession to more than 100.
That growth is still continuing. On May 4-6, the company is hosting its first industry conference, Groundbreak, and will also unveil the latest addition to its headquarters. According to brokers the Business Times spoke with, Carpinteria offers several draws to companies looking to locate there.
“It’s a quaint city on the beach. And it’s well situated between two major markets: Ventura County on the south end, with Camarillo, Oxnard, Port Hueueme and that employee base. And it’s got Goleta and Santa Barbara to the north,” Celmayster told the Business Times. “It’s an ideally situated location for companies that need to pool employees from a broader base.”