New owners want to help startups
After nearly two years on the block, historic Warner Hollywood Studios has been sold to investment group BA Studios for $65 million.
BA is a joint venture of L.A.-based Skye Partners, a real estate development company, and Gotham financial backer Blackacre Capital Management.
Skye Partners will oversee the day-to-day operations of the 13-acre facility located on Formosa Avenue in Hollywood, which will be renamed The Lot. Its principals are Greg Harless, Nick Smerigan and Richard Glanas.
Though no radical changes are on the horizon for the 80-year-old site, its new owners want to become known for giving smaller entertainment startups a chance to grow.
“Our basic business plan is: Go to the indie people. Instead of them playing second fiddle to Warner Bros., they’re going to be top dog on the lot,” said Smerigan, who confirmed the sale figure and added that “We think we’re getting a good value for what we’re spending.”
Harless and Smerigan stressed that they have no intention of using the purchase to become moguls themselves: “We want to remain landlords,” Smerigan said. “We do not want to make movies or TV series.”
Established in 1919 as Jesse D. Hampton Studios, the lot quickly became the home to Mary Pickford and Douglas Fairbanks, and later took the name United Artists Studio when the duo merged with Charlie Chaplin. In 1938, the name was changed again — to Samuel Goldwyn Studios, and finally, in 1980, the lot was taken over by Warners as its main alternative to its Burbank site.
Among the films made on the lot in its heyday were “Robin Hood” with Erroll Flynn and Basil Rathbone, “The Thief of Baghdad,” “Guys and Dolls” and “West Side Story.” More recently, the upcoming Castle Rock/WB pic “The Green Mile” was shot there.
Expected to close in late December, the divestment marks the apogee of Warner Bros.’ revamping of the more convenient Burbank Ranch as the main satellite facility for the studio.
“Since our reacquisition of the Sony portion of our Burbank lot in 1990, we have been focusing our capital improvements on updating and expanding our 110-acre main lot and 32-acre Burbank Ranch, with the goal of meeting our production needs in state-of-the-art facilities here in Burbank,” explained Gary Credle, prexy of WB studio facilities.
WB post-production sound will continue to be based on the Formosa Avenue lot under a long-term agreement with Skye Partners and is unaffected by the sale.
“It is no longer strategically necessary for us to retain ownership of the studio facilities there,” Credle concluded. The post facility was just upgraded with a digital-mixing room, with another in the works.
Current WB producer deals with offices at Warner Hollywood will remain unaffected as well, even if they will be paying rent to someone else in the new year.
The most recent serious buyer, Raleigh Studios, was in talks to acquire the lot across from the Formosa Cafe a year ago, but the deal fell apart.
Formosa Cafe served
The land resting underneath the Formosa Cafe, a favorite haunt for Warner Hollywood types and movie stars and which was featured in the WB pic “L.A. Confidential,” is also part of the sale to BA, and will remain a part of the new ownership for at least another five years.
WB tried to sell off the Formosa land in 1993 but was thwarted by an outcry from actors and writers who impressed on then-chairman/CEO Bob Daly the watering hole’s cultural importance for the creative community.
The new owners agree the Formosa is a significant part of the lot and have no plans to spin it off.
“Lots of people are emotionally attached to the Formosa,” said Harless and Smerigan. “We’d be shooting ourselves in the foot to throw away something with such name recognition.”
Skye Partners also recently acquired Culver City site the Ten9Fifty Studios from Hamilton/Avnet Electronics, and it is now the home to several burgeoning dot-com and indie feature shingles.