Hollywood Studios on the Block

The haunts of Hollywood's Golden Era — studio backlots where such classics as “It Happened One Night” and “Gone With the Wind” sprang to life — are being sold for top dollar to investors dazzled by the availability of premium land in Los Angeles. But investors face resistance from some Hollywood veterans, who worry that the film capital will lose too much of its storied heritage.

Sunset Gower Studios, formerly the Columbia Pictures lot, recently sold to Hudson Capital of Los Angeles for $200 million, nearly double the $110 million the 16-acre lot fetched just three years ago. In June 2006, Oaktree Capital Management of Los Angeles sold Manhattan Beach Studios for $150 million to New York-based private equity firm The Carlyle Group. Tribune Co.'s property on Sunset Boulevard, housing KTLA-TV and Tribune Studios, is for sale. The property is the location of the former Warner Bros. studios, where the first “talkie” movie was made with Al Jolson in 1927. Meanwhile, in Culver City, the 17-acre Culver Studios, where Rhett wooed Scarlett, will be auctioned. “We thought it was a great time to sell a studio,” says CEO James Cella.

After decades of commercial real estate decline, Hollywood is hot. Across the continent, in New York and elsewhere, investors and developers are hungrily eyeing the old studios and surrounding property. “A ton of capital is looking at Hollywood,” says Kevin Shannon, vice chairman of CB Richard Ellis, which brokered the Sunset Gower sale. “They know the Times Square story. A lot of investors are out here from New York and see the potential for a Times Square-type situation.” At Times Square, property values soared after declining and seedy commercial sections were cleaned up.

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source: nreionline.com