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Warner Bros. Hopes to Consolidate Offices in Burbank

Warner Bros. Hopes to Consolidate Offices in Burbank Real Estate by Shelly Garcia Warner Bros. could go a long way toward relieving some of the real estate pressure in Burbank. Warner has put out the word that it is interested in looking at a huge amount of office space, anywhere from 200,000 square feet to 400,000 square feet, in the city. The company has no definitive plans to move ahead with a full-scale relocation, but Warner officials say they’d like to explore their options for consolidating operations in Burbank, where the studio is located. “We’re not going to move the lot, and we have other offices all over the place, so it makes sense to look at our options,” said a senior executive. Like The Walt Disney Co. and other entertainment giants, acquisition and expansion strategies over the recent past have left Warner with a patchwork of far-flung locations. The businesses under AOL Time Warner’s entertainment and networks division, which includes Turner Broadcasting System, WB Network, New Line Cinema, Warner Bros. Online among others, are currently scattered from Glendale to West Los Angeles, Burbank and Sherman Oaks. The company has issued a request for proposals and hired Cushman & Wakefield to seek out options for relocating those offices within Burbank, where the studio is located. Just last month, Warner Music Group signed on at M. David Paul Development Group’s Pinnacle office development in a move that will consolidate several of that group’s operating companies. Like the entertainment unit, the operating divisions, including Atlantic Records and WEA Corp., the company’s distribution arm, had operated in a number of different locations. In making an announcement about the move, Warner Music officials said the consolidation would result in substantial cost savings. It is likely the entertainment group has the same objective in mind. Meanwhile, Burbank can surely use the additional occupancy. The downturn in the real estate market followed a spurt of new construction in the city, leaving Burbank with a 29-percent vacancy rate including well over 1 million square feet of direct space as of the second quarter. Warner could opt into some of the newly constructed properties, as the Music Group did, or it could contract for a build-to-suit or some combination of deals. But the wide span of square footage specified in the RFP also indicates that Warner may not necessarily move forward with a full-scale relocation of all its operating units. “They’re keeping a very flexible approach to see what will best meet their needs,” said Bud Ovrom, Burbank city manager. Santa Clarita Center Sold Sierra Crest Center, a shopping complex in Santa Clarita, sold to Zimmerman Commercial Partners, a Los Angeles investment group, for $8.85 million. The strip center, developed in 1991, includes 71,652 square feet of retail space on 4.35 acres at 27125 Sierra Highway. The center houses Taco Bell, State Farm Insurance, Firestone Tires and other companies. It is 90-percent leased. John Erthein and Gregory Mills at Marcus & Millichap Real Estate Investment Brokerage Group represented the seller, Westminster Capital in Beverly Hills. Van Nuys Sale Local real estate investor Rickey Gelb of RMG Properties has acquired a 49,000-square-foot office building in Van Nuys for $4.175 million. The Hathaway Building, at 7120 Hayvenhurst Ave., is 88-percent occupied. Mark Perry, a broker with CB Richard Ellis, represented the seller, HFH Ltd. Gelb represented himself in the deal. Studio City Deal VLS Investors LLC has acquired a complex of five buildings at 10932-36 and 10946-64 Ventura Blvd. in Studio City for more than $4 million. The buildings, a mix of office and retail space on eight parcels of land, total 24,611 square feet of space. David Ickovics, a broker with Charles Dunn Company Inc., represented the buyer. Dunn’s Stacy Vierheilig-Fraser represented the seller, Al Radilaleh. Canoga Park Sale The 50,588-square-foot Valu + Center in Canoga Park was sold to a private investor, Anoushavan Abrahamian, for $7.58 million. Chris Thompson and Garrik Kumjian with Investment Real Estate Associates represented the buyer and seller, Market Venture LLC. Westlake Lease Mercury Insurance leased 30,000 square feet of office space at 5601 Lindero Canyon Blvd. in Westlake Village. Jeremy Dee with Corporate Realty represented the tenant. Keith Green and David Corsello of Daum Commercial Real Estate Services and Darryl Zilberstein and Tony Principe of Westcord Commercial Real Estate Services represented the landlord, Arden Realty. Senior reporter Shelly Garcia can be reached at (818) 676-1750, ext. 14 or by e-mail at [email protected].

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