The Fox lot in Century City has been a movie studio for more than 80 years, the place where classics like “Hello Dolly!” and “How Green Was My Valley” were filmed. But with the massive Disney-Fox merger on Thursday, the future of the 53-acre lot has been thrown into doubt.
The remaining Murdoch empire will hang on to the property for now, and has agreed to lease the studio space back to Disney for seven years. But that’s a relatively short horizon given the glacial time scale of real estate development, and it has led to speculation that the Murdochs will look to offload the property, perhaps even before the lease expires.
It is possible that another content producer — such as Apple, Amazon, or another digital provider — may seek to acquire the property, or just rent out any space that Disney opts to vacate. But purely as a business proposition, the land may be worth much more to a luxury residential developer.
“There’s going to be pressure from shareholders to sell the assets,” said Tucker Hughes, managing director of Hughes Marino, a corporate real estate firm. “I have a variety of clients who would be interested in purchasing the lot.”
The property could be worth upwards of $1.5 billion. A developer could transform it into a master-planned mixed-use campus, with high-end luxury condos, retail and office spaces — the largest such project in Los Angeles since the Playa Vista development two decades ago.
There is, of course, a major obstacle: zoning. The site is currently governed by the Century City South Specific Plan, and any change would require an amendment to the city’s general plan.
“It’s very much tied to the studio use,” said Craig Lawson, a land use consultant. “To change that would be a long-term process. You’re talking several years. They could try and do it, but it would be very contentious.”
The site also could be subject to historic preservation restrictions. The lot has more than 80 buildings, of which 58 were considered to have historical value in a 1994 survey. Any move to develop the property could trigger an effort to save those buildings on historic grounds, as is now happening with CBS Television City on Fairfax Avenue. A new development might have to retain and repurpose the historic buildings, which would add to the project’s cost.
“There could be a real war over some of the preservation issues,” said Dale Goldsmith, a real estate lawyer at Armbruster, Goldsmith & Delvac.
There is also the issue of traffic. Under current regulations, any development plans on the lot are subject to a “net-zero” traffic impact condition, which mandates that any increases in traffic be offset by operational changes. The rule is in place to accommodate Cheviot Hills homeowners who commute on Motor Avenue, which is already deemed to be at its maximum traffic capacity.
The L.A. Metropolitan Transportation Agency is extending the Purple Line subway, with a stop in Century City scheduled to open in 2025. That could allow for greater development in the area, as planners would factor the commuting trips that would go by train.
“For the foreseeable future it’s going to be maintained as a media use,” said Jerry Neuman, a land-use lawyer at DLA Piper. In order to change the land-use, he said, “the whole lot would have to be rezoned and re-imagined. The community would certainly have a lot of concerns over that.”
Goldsmith worked for Fox on the existing specific plan in the early 1990s, and remembers bitter neighborhood opposition to the addition of office buildings and a parking garage.
“Is it impossible? Not if you have the right land-use lawyer,” he said. “It isn’t easy. It would be a lot of heavy sledding to get anything other than a studio use.”
(pictured: filming “Hello Dolly” on the 20th Century Fox lot)