SPUSD Borrows to Finance Purchase of New Headquarters

After a couple of efforts to sell its current office stalled, the South Pasadena Unified School District has taken out a loan to close escrow on the new building it agreed to purchase last year.
Meanwhile, the district announced it has entered escrow with a development firm that has tentatively agreed to purchase its longtime home.
The SPUSD Board of Education pulled the trigger on the loan last week, around a month after agreeing to modify its purchase agreement for the new facility, located at 1100 El Centro St. The district is borrowing $11 million, at 2.48% interest over 20 years, with an option for early payment after it sells its current headquarters at 1020 El Centro St.

“Securing this new space for our district employees is a thrilling way to begin 2021,” said Ruby Kalra, school board president, in a statement. “Years of hard work have gone into our overall facilities planning, and finding an office environment that so efficiently meets our needs for safety and location, while remaining within our fiscal means, is a huge accomplishment.”
District employees won’t have to move far — the buildings are across Fairview Avenue from each other — and they will have more space to spread out once they do so. The district has long aimed to extract itself from its current location, a historic site more than 100 years old, because of its aging infrastructure and the fact that the district had simply outgrown the footprint of the buildings.
The new location, now occupied by the law firm Collins Collins Muir + Stewart, was built in the 1970s and boasts more square footage than the current site.
“When presented with the opportunity to purchase a building that accommodates the current and future operational and technological needs in a responsible manner, the board felt very strongly that we should proceed,” Kalra said.
The district searched for a property for two years, with the help of commercial real estate broker Sam Manoukian. The 1100 El Centro property was ultimately identified as the best among several options, which at one point included a potential land swap. The district agreed to purchase the building in May and initially made the closing of escrow contingent on selling 1020 El Centro.
Two offers to buy the current location have, however, fallen through since then, prompting the retooling of the purchase agreement to expedite escrow in any case. Without offering other details, the district said Gangi Development Inc. has entered escrow for 1020 El Centro.
Collins Collins Muir + Stewart plans to vacate 1100 El Centro by the end of March, according to the district. After moving in and making minor modifications to the inside and outside of the building, the district said, it plans to be up and running by the start of the new fiscal year on July 1.
In a statement, Superintendent Geoff Yantz called this “the best place for our future home.”
“The building offers a safe and modern workspace for our employees, ample parking, professional conference rooms and a space that with minor renovations will be a board room and professional training area for nearly 100 attendees,” he said.