DreamWorks

DreamWorks/27″/dt1st/mike2nd By CHRISTOPHER WOODARD Staff Reporter News that DreamWorks SKG had abandoned plans for its Playa Vista studio complex had Los Angeles political leaders giddy over the prospect of attracting the studio to North Hollywood. After all, developer J. Allen Radford already has a $400 million studio and office complex planned for the community’s redevelopment area, and Radford’s project site is very near to DreamWorks’ operations in Glendale and Universal City. “The level of excitement around here has been intense,” said Walter Beaumont, North Hollywood project manager for the L.A. Community Redevelopment Agency, who fielded calls from Mayor Richard Riordan’s office and City Council leaders immediately after the Playa Vista announcement. “It’s amazing how much enthusiasm and support these guys (DreamWorks founders Steven Spielberg, Jeffery Katzenberg and David Geffen) generate.” The only problem is, DreamWorks doesn’t appear to share in the excitement over North Hollywood. “We’ve had no indication they’re interested in coming here. They haven’t called here, and as far as I know, they haven’t called Radford,” concedes Beaumont. Indeed, DreamWorks spokesman Andy Spahn confirmed last week that the studio has sidelined plans to build its own sound stages, at least for the next few years. The prospect of the company moving to North Hollywood any time soon is “unlikely,” he added. “There have been additional sound stages built (in greater Los Angeles) since we began (negotiating for) the Playa Vista project,” he said. “As all the traditional studios do, we can rent space.” The company will consider expanding its operation at Universal Studios Inc.’s facilities in Universal City, where Spielberg has based his Amblin Entertainment production company for the past two decades, as well as possibly adding to its Beverly Hills music facility, said Spahn. But DreamWorks’ first order of business will be to take “an immediate and hard look” at expanding at its Glendale animation campus, where it has room to develop another 150,000 square feet of office space on about 14 acres, Spahn said. After the Playa Vista deal went south, Glendale City Manager Jim Starbird shot off a letter to DreamWorks indicating the city stands ready to assist the company’s expansion in that city. DreamWorks executives have since sent a letter saying they hope to meet with Glendale officials soon, Starbird said. “(DreamWorks’ decision to pull out of Playa Vista is) good news not only for Glendale, but for the San Fernando Valley too,” Starbird said. Not ready to see its longtime competitor land DreamWorks, neighboring Burbank has also fired off two letters inviting the entertainment company to consider building office space there. “We’re clearly going talk to them about locating in Burbank,” said City Manager Bud Ovrom. “We have some premiere locations in the middle of all the (entertainment) activity.” Radford declined to comment about the prospects for luring DreamWorks to his North Hollywood site, but a source close to the project said Radford’s group is optimistic. If DreamWorks decides to develop a new studio, North Hollywood would seem to be the ideal place. “Nobody’s got any dirt but us,” said the source, citing the scarcity of land elsewhere in the San Fernando Valley. Radford began pursuing the North Hollywood development in the first place when DreamWorks expressed interest in the site after the Playa Vista deal began to stall. Originally, Radford and his group, JARCO/SLG & G; LLC, proposed a $750 million, 42-acre studio and office complex, but the developer scaled the plan back to a $400 million, 30-acre project after the Playa Vista project appeared to be back on track, said Beaumont. L.A. City Councilman Joel Wachs said he would love to see DreamWorks move into North Hollywood, and added that the city would be prepared to offer subsidies in return for the creation of jobs. “It would be great for North Hollywood and the Valley, and I’d certainly be willing to work with them if they’re interested,” said Wachs, noting that Radford’s site is centrally located between DreamWorks’ Glendale and Universal City operations and adjacent to a Metro Rail subway station that is now nearing completion. But judging from Spahn’s comments, a move to North Hollywood isn’t in the cards for DreamWorks, at least not in the foreseeable future. Despite all the jockeying, an expanded campus in Glendale would take care of the company’s immediate needs. Paul Stockwell, corporate managing director for real estate brokerage Julien J. Studley Inc., said he would be surprised if Katzenberg were ready to jump back into a major project following the Playa Vista ordeal. Stockwell and Katzenberg worked together at Walt Disney Co., where Stockwell was formerly Disney’s vice president in charge of real estate. “I know Jeffrey, and I suspect he wants to get back to what he loves doing: making TV, movies and animated features,” said Stockwell. “At least in the near term, they could satisfy their production needs by renting (sound-stage) space.” Jack Kyser, chief economist with the Los Angeles Economic Development Corp., agreed. In addition to space at Universal Studios, DreamWorks could lease space at any of several new sound stages coming on line in greater Los Angeles. “The question is, do you need a full-bore studio? Once they got it up and running, there would be operating expenses, taxes, and then they’d have to lease out the space on an ad hoc basis,” said Kyser. “It would seem to make more sense to just lease other space. For them, the key need would probably be administrative facilities.” But while DreamWorks’ plans are still up in the air, indications that the company is interested in consolidating its operations in the San Fernando Valley have business leaders overjoyed. “Everyone in the Valley is excited,” said Ivy Weiss, executive director of the Universal City/North Hollywood Chamber of Commerce. “It’s a very high-profile company. The product is excellent. It’s run by three major leaders in the entertainment community. I just think it’s a very sexy organization.” Kyser said a DreamWorks consolidation in the Valley would further bolster the area’s reputation as an important entertainment center. “It opens up a lot of new doors,” said Kyser, noting that in addition to DreamWorks, the Valley boasts Universal Studios, Warner Bros., Disney and NBC. DreamWorks’ decision to pull out of the Playa Vista project also serves to slow the migration of entertainment companies to the Westside, Kyser said. “All of a sudden, the westward drift has come to a crashing halt,” he said.