Television City, one of the most famous studios in the entertainment industry where TV shows are produced, is expected to go on the market again as its owner faces debt.
It’s the latest sign of stress in Hollywood as the film and TV industry struggles from a sharp drop in production across Southern California.
Television City’s owner, Hackman Capital Partners, is already in the process of selling the historic Radford Studio Center, which gave LA’s Studio City neighborhood its name. Hackman defaulted on a $1.1 billion loan in January and investment bank Goldman Sachs repossessed the building, which is now up for sale to Netflix.
The sprawling Television City area is one of the most desirable areas in Los Angeles, sharing land with the Original Farmers Market and the luxury Grove outdoor mall, each attracting millions of visitors each year.
If the studio at Beverly Boulevard and Fairfax Avenue where “American Idol,” “All in the Family” and many other shows are filmed goes as expected, the owners of the Grove and the Farmers Market will be among those who may join the battle for space to expand their businesses, said sources familiar with the matter who were not authorized to comment.
The Grove’s owner, Rick Caruso, was among the bidders for Television City, which was known as CBS Television City, last time it was on the market and may go out as a non-bidder.
The CBS broadcaster’s highest bid for a studio in 2019 came from Hackman Capital Partners, an international studio and real estate developer that paid $750 million for the 25-acre site near Hollywood, Beverly Hills and the Sunset Strip.
Hackman Capital’s plan to recoup its investment includes continuing to operate City Television as a rental studio while adding new revenue-generating features.
Last year the city approved Hackman Capital’s $1-billion plan to add 980,000 square feet of offices, sound stages, manufacturing facilities and retail space.
The original studio designed by famed Los Angeles architect William Pereira built in 1952 has city landmark protection, but new buildings in the area do not and there are acres of surface parking that could be converted to other uses.
Both the owners of Caruso’s Market and the Farmers Market, AF Gilmore, sued to block the studio’s planned expansion, calling it a “gross development” that would “overrun, disrupt, and change the community forever.”
The debate over the development has been played out amid a major downturn in the region’s entertainment industry, as studios shift film and television production to Georgia, New Mexico and other out-of-state locations.
LA’s entertainment industry has also faced challenges including COVID-19 shutdowns, writer and director strikes in 2023 and studio cutbacks that are reducing demand for sound stages.
Hackman Capital’s group of lenders led by Deutsche Bank filed for default last month, saying it owes more than $357 million. Hackman Capital is still trying to renegotiate its debt.
“The studio market is evolving, and the financing environment for studio assets remains complex,” CEO Michael Hackman said in a statement. “We are engaged in active discussions with our lending partners and are carefully considering all other options.”
A person familiar with the process but not authorized to speak publicly said Hackman Capital will be under pressure to pay its debt because of the challenges facing the industry. The default notice is “a baby step to play Television City” for new buyers, the source said, “and it’s being played.”
Manhattan Beach Studios, another Hackman Capital property secured by a $240-million loan from Deutsche Bank, is in the process of being sold. A buyer can close the property and convert its use to advanced manufacturing such as aerospace or defense, which is in high demand in Southern California.
Brokerage Cushman & Wakefield, which is handling the sale, emphasized in marketing materials that the 22-acre site “has significant potential” and “offers a versatile use” for “another irreplaceable piece of land in the South Bay.”
