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Atlanta Bank Buys DreamWorks Campus

DreamWorks Animation SKG Inc. has sold its Glendale campus for $185 million to the investment arm of SunTrust Banks Inc., an Atlanta bank holding company, according to a studio regulatory filing on Thursday. Chief Executive Jeffrey Katzenberg disclosed the sale and lease back of the manicured, Tuscan-style campus during a Tuesday conference call to discuss the struggling studio’s fourth quarter earnings but did not reveal the buyer. The regulatory filing states that the studio has a 20-year lease with DW Glendale CA Landlord LLC that starts at $13.2 million and increases 1.5 percent annually. DreamWorks has four five-year options after the initial period ends. The Flower Street campus totals 10 buildings of 400,000 square feet on 14 acres and was built in 1997. The facility features a no-cost cafeteria, water fountains, koi ponds and walking paths. DW Glendale is a subsidiary of SunTrust Equity Funding LLC, the investment arm of SunTrust Banks, which has commercial banking operations in the Southern and Mid-Atlantic states. DreamWorks officials said on Tuesday the campus would be sold as the company tries to right itself from financial setbacks. “There’s obviously a benefit from the liquidity perspective, but just corporate finance theory would tell you having a large unencumbered piece of real estate on the balance sheet of the company of our nature just doesn’t make a ton of sense,” Chief Financial Officer Fazal Merchant said during the conference call. DreamWorks has been hard hit financially in recent months following the release of several films that have failed to perform at the box office, forcing lay-offs and scuttling two merger opportunities. The company reported a net loss of $263 million ($3.08 a share) for the quarter ended Dec. 31, compared with net income of $17.2 million (20 cents) in the same period a year earlier. Revenue increased 14.7 percent to $234 million.

Mark Madler
Mark Madler
Mark R. Madler covers aviation & aerospace, manufacturing, technology, automotive & transportation, media & entertainment and the Antelope Valley. He joined the company in February 2006. Madler previously worked as a reporter for the Burbank Leader. Before that, he was a reporter for the City News Bureau of Chicago and several daily newspapers in the suburban Chicago area. He has a bachelor’s of science degree in journalism from the University of Illinois, Urbana-Champaign.
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