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July 03, 2020  

Goldman to Lead Big Loan on Calif. Studios

Goldman Sachs and Barclays have agreed to lend a Blackstone joint venture $900 million to finance the recapitalization of three Hollywood production studios and adjacent offices in Los Angeles.

New York-based Blackstone is acquiring a 49% stake in the 2.2-million-square-foot portfolio from Hudson Pacific Properties, a Los Angeles REIT that will retain a 51% interest and continue to operate the properties. Slated to close in a month or two, the transaction values the space at $1.7 billion.

Goldman is leading the financing. It will fund 70% of the five-year, floating-rate loan to the Blackstone-Hudson partnership, while Barclays will take down the rest. They plan to securitize the entire amount in a stand-alone commercial MBS offering.

The banks also are serving as Blackstone’s financial advisors on the transaction. Eastdil Secured is brokering the loan and is Hudson’s lead financial advisor. Bank of America also is advising the REIT.

The three television and film studios, encompassing 35 sound stages with 1.2 million sf of production space, are:

Sunset Bronson, at 5800 Sunset Boulevard.

Sunset Gower, at 1438 North Gower Street.

Sunset Las Palmas, at 1040 North Las Palmas Avenue.

The portfolio also includes 966,000 sf of Class-A office space at or near the studios.

The largest tenant is Netflix, which has leases or commitments to rent about 700,000 sf of office space and long-term deals to use the studios and production facilities, according to Hudson.

Meanwhile, the joint venture between Blackstone and Hudson has the rights to develop an additional 1.1 million sf of offices and production facilities at Sunset Gower and Sunset Las Palmas.

Blackstone and Hudson have worked together on big deals before. In 2015, for example, Hudson paid $3.5 billion to buy an 8.2 million-sf office portfolio in Silicon Valley that Blackstone had acquired in 2007 via its $39 billion takeover of Chicago-based Equity Office Properties.