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Culver City Real Estate Market Grows Into Content Capital – The Hollywood Reporter

Culver City Real Estate Market Grows Into Content Capital – The Hollywood Reporter

In 1995, Adam Lilling, founder and managing partner of PLUS Capital, a venture advisory firm that helps talent invest in startups and build brands, moved into an office in Culver City, whose glory days as the home of MGM and RKO were long past. “The office we were in always leaked — if it rained you had problems,” he recalls. “You just drove to work and you drove out of there. [Culver City] was not a place you wanted to stop and spend time. … My perception was it was just a sleepy and warehouse-y place.”

Fast-forward to 2021: Amazon Studios, WarnerMedia, Apple and TikTok have all taken office space in the city in the past four years, joining Sony, which purchased the old MGM studios in 1990. On Oct. 8, Apple announced that it was further increasing its presence in Culver City; it is building two new connected facilities along National and Venice boulevards in what will be a more than 550,000-square-foot headquarters for its teams across the region.

Lilling (who has lived in Culver City since 2008) cannot believe the changes he has seen. “It’s staggering what’s happening here,” he says. Jeff Pion, vice chairman of commercial real estate power player CBRE, agrees. Culver City, he says, is now “one of the content capitals of the globe [and] one of the most vibrant markets in Los Angeles.”

Colin Diaz, president and CEO of the Culver City Chamber of Commerce, points to the development of the Hayden Tract area over the past decade as a turning point for the city. Once a rundown light-industrial district, the area has been transformed by architectural firms like Eric Owen Moss and development groups including Samitaur Constructs and Newmark into a cutting-edge, mixed-use business center for tech startups, ad agencies and design firms.

The new demand for streaming content, the 2012 arrival of light rail with the Expo Line, an abundance of existing studio infrastructure and a central location have worked in Culver’s favor. “It’s the center of the donut in that it’s very central to West L.A., Santa Monica, Beverly Hills, Pacific Palisades, Malibu, Hollywood, Silver Lake and Manhattan Beach,” says Pion.

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One of the biggest landlords is Hackman Capital Partners, which purchased Culver Studios in 2014. It has leased most of the complex to Amazon while expanding it. Hackman has invested millions in developing adjacent The Culver Steps mixed-use development, which boasts 45,000 square feet of retail space and 80,000 square feet of office space (where Amazon also has leased), and in January spent $160  million to purchase the campus of Sony Animation Studios.

Other major developments include CBRE’s One Culver (renovated in 2017 by Gensler), where Apple has leased more than 150,000 square feet, and Lowe Enterprises’ $350 million mixed-use Ivy Station, where WarnerMedia (including HBO) has leased space. Entertainment and tech companies also are buying. In 2020, Apple purchased an entire block of warehouses and office space for $162 million in partnership with Venice Pacific Investments. (Apple’s initial foray into Culver City was in 2014 when it moved its Beats by Dre division to offices there.)

In the second quarter of the year, asking rates for office space in Culver were $4.34 per square foot, 17 percent higher than for Greater L.A., per CBRE.

The influx of power players has brought countless support businesses scurrying for office space in the area. “A lot of those companies are peripheral of film or television, and they are able to work directly with the larger players in the community. They have formed their own ecosystem here locally.” Diaz says.

As available space in Culver City shrinks, its renaissance is spilling into neighboring communities. Carmel Partners’ Cumulus District, a mammoth new mixed-used development, aims to link West Adams with Culver City. The project includes a 31-story residential tower and 1-acre park.

CBRE’s Pion calls the city “a wonderful place to do business. It’s a small town, the city officials are responsive, they’re accessible, it’s a fantastic business environment.”

Other entertainment businesses that have set up shop in Culver City include video game company Scopely, which opened an office there in 2013 and has since more than doubled the amount of space it leases. A spokesperson for Scopely says regarding why it chose to put down roots in Culver City (it also has offices in Europe and Asia): “Every location has been chosen based on: where world-class talent are located or want to relocate, being centrally located within a city, and appealing to a creative, innovative vibe.”

The boom is certainly increasing employment numbers. Diaz estimates that the influx of industry will bring between 7,500 to 9,500 jobs to the city. In April 2021, Apple alone announced that they planned to have 3,000 more employees in Culver City by 2026. As of 2019, Sony Pictures Entertainment is the biggest employer in the city, with an estimated 3,000 people working there.

To make sure residents benefit from the meteoric growth, the Chamber is starting a program called Hire Culver. “We aim to have a job board where residents can apply for positions a few weeks before opening them up to the general public,” says Diaz.

However, not all of the city’s 40,000 or so residents are thrilled with the pace of change. There are worries about traffic, which the City Council hopes to ease by increasing micro-transit options (i.e., small-scale, on-demand public transit). And some locals fear their quaint town is losing its soul as high-ticket condo buildings rise up and the median sales price of a home hit a record $1.3 million in 2021.

The influx of entertainment jobs also has brought increasingly hip restaurants and high-end retail stores, such as at the 5-year-old Platform retail project. “[The residents] will still refer to things as Mayberry. It doesn’t matter. If everything stopped today, that will never come back,” Diaz says. Among the recent restaurant openings is Etta, from Michelin-starred Chicago chef Danny Grant, which just debuted at the new Shay hotel, part of the Ivy Station development.

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Producer Dave Ragsdale (Pink Opaque), who has lived in Culver City for seven years, compares the changes with what his old neighborhood of Cobble Hill in Brooklyn went through during the early 2000s. “I do know that there has been some loss for the community and the character of Culver City,” he says. “But we’re pretty stoked on the downtown area and all of the restaurants popping up.”

ON THE MARKET IN CULVER CITY

8617 Higuera Street: A newly built mid-century-modern style home in Culver City, featuring five bedrooms and a gated driveway, is on the market for $3.495 million. At 3,500 square feet, it also includes a nine-foot-tall cedar-and-glass front door, a great room with 15 foot ceilings and fireplace, oak flooring, a kitchen with a large, eat-in island and a media room. The primary suite has two bathrooms and a bonus space that could serve as a nursery or office, while a roof deck features an outdoor fireplace. It’s listed with Mike Deasy and Sara Clephane of Deasy Penner Podley.

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A version of this story first appeared in the Oct. 6 issue of The Hollywood Reporter magazine. Click here to subscribe.

This content was originally published here.

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