The Toy Association, a trade group, has opened a “Toy Building” in El Segundo, California, an effort to satisfy the need for member companies to connect with larger firms that have a presence there.

The facility, comprising four floors and more than 100,000 square feet in an existing building in downtown El Segundo, was announced earlier this year, but Toy Association president and CEO Greg Ahearn said discussions around the space began within the board in 2023.

“Everybody had seen the organic growth of the toy industry within El Segundo—many of the larger companies have permanent locations here,” he said. “But many medium-sized companies, even some small ones, were looking to have a presence here as well.” In addition to access to large toy manufacturers, Ahearn said, the location also gives tenants close access to entertainment companies that strike licensing deals with toy properties. 

The new facility should also give the companies a better connection with each other, Ahearn said. “Association people will get this: We use a term called ‘casual collisions.’ which is when you’re looking to meet that certain person in a trade show and if you create the environment where people are moving around and that there’s moments of time that they can see each other and network,” he said. “Those moments in time will create these collisions where business gets done, and that’s what we’ve done.”

The Toy Association has a ten-year lease in the El Segundo space, and is offering three- or five-year leases to tenants. A brochure for the space [PDF] says that the 65 showrooms range in size from 475 to 1,920 square feet and rent for $4.75 per square foot.

The association had similar success with more short-term showcases attached to a regular meeting in Dallas before Covid, and Ahearn said it spoke with members about the viability of a more permanent presence.

“We did a bunch of surveying with our member companies, which gave us the confidence to temporarily lease space for 2024—and from that experience gave us the confidence to sign into a long-term lease in the building we’re in now and then do a full build-out,” he said. 

“There aren’t a lot of associations that are getting into the long-term leasing of space, building out space, and being responsible for that build-out and the subleasing,” he added. “It’s very unique, but our industry is very unique. We’re a very innovative, very creative industry, and it seemed like it was an important thing to do.”

He cautions, though, that the Toy Association benefits from having major companies in the industry and ancillary businesses clustered in one region, and that the concept may not work for associations with more widely distributed members. “If they don’t have that, where there’s a critical mass, taking the risk probably is not a great idea,” he said. 

Ahearn said that the building is currently between 65 and 70 percent of capacity, with tenants including Hasbro, Lego, Crayola, and Playmobil. “Tariffs have always been a challenge, and that’s created a small headwind,” Ahearn said. “But as we opened up the building on Monday, everybody that comes in and sees the Toy Building gets it immediately and understands exactly what we’re doing. We’re creating a hub.”