Time Warner Nearing Sale of Manhattan Headquarters for $1.3 Billion (Report)

Time Warner is closing in on a deal to sell its midtown Manhattan headquarters to real estate firm Related Cos. for $1.3 billion, the Wall Street Journal reported Wednesday.

A sales agreement for the Time Warner Center, on whose construction the entertainment conglomerate spent around $520 million about a decade ago, could be announced as early as Thursday, it said.

A Time Warner representative declined to comment.

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Sources have said that Time Warner has focused on a sale of its current building at Columbus Circle that would allow it to lease office space there for about five years before consolidating it's New York operations in a new building. It currently has seven different office locations in the Big Apple.

That building could be a new commercial tower that Related has been developing in the Hudson Yards neighborhood on Manhattan's far West Side, south of Times Square. The conglomerate is believed to have reached a tentative agreement to move into the 80-story skyscraper set to be built at the corner of 10th Avenue and 33rd Street. Other options include a new development on the site of the former World Trade Center.

Time Warner, led by chairman and CEO Jeff Bewkes, has been exploring its real estate options for about two and a half years in an effort to save money and consolidate the staff of its various operations. Most of its current New York leases are up in 2017.

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The far West of Manhattan has cheaper real estate. Previous chatter was that TW could save as much as $100-million-plus by moving office space.

Related has offered to sell the new office space at cost to get TW as an anchor tenant, hoping to make money from the retail and residential parts of the real estate development, according to previous reports.

The Time Warner Center sale could be one of the biggest in a recent slew of commercial real estate deals in the U.S. that have relied on foreign investors.

Related is financing its bid for the Time Warner Center with backing from so-called sovereign-wealth funds from Abu Dhabi and Singapore, sources told the Journal. The Abu Dhabi Investment Authority and the Government of Singapore Investment Corp. would own most of the property venture, but Related would manage the building, the paper said.

E-mail: Georg.Szalai@THR.com
Twitter: @georgszalai

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Survey Confirms Earthquake Fault Line Runs Through Planned Millennium Hollywood Project

Millennium Hollywood project rendering (right)

The California Geographical Survey on Wednesday released an earthquake map charting the course of the Hollywood Fault at City Hall. The map shows that major planned developments -- including an apartment complex on Yucca Street and, most notably, the controversial two-tower Millennium Hollywood skyscraper project -- are much closer to an active fault than previously claimed.

The $664 million Millennium Hollywood project -- a pair of proposed 35- and 39-story towers that would include one million square feet of hotel, office and retail space -- got an OK from the Los Angeles City Council on July 24, despite a huge opposition campaign claiming city reports far underplay traffic increases and a serious seismic situation.

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In November 2012, city officials acknowledged that they had used outdated fault maps when the Millennium project was approved. The newly released state geographical maps show a fault line much closer to many proposed projects, including the Millennium Hollywood towers. State law requires that any new development within a zone of approximately 500 feet around a fault line be subject to extensive seismic testing. The law also prohibits building directly on top of faults.

“The California Geological Survey map today confirms what my clients have been saying -- that the Hollywood Earthquake Fault runs right through the Millennium property,” said attorney Robert P. Silverstein in a statement. Representing a citywide coalition of community groups that is suing to overturn the City Council’s approval of the Millennium Hollywood project, Silverstein added that “this map will now become ‘Exhibit 1’ in our lawsuit.”

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SBE to Occupy Variety's Wilshire Blvd. Offices

SBE, founded by nightlife and hotel impresario Sam Nazarian, will lease the top two floors of 5900 Wilshire, reports the Los Angeles Times, leaving its current offices near Beverly Blvd. and Fairfax, and moving into the Variety space. The trade magazine’s sign, which was removed last November from the top of the building, will be replaced with an SBE sign by spring.

Nazarian and his 100 employees will be in good company in their new 30,000-square-foot digs: Robert Redford’s Sundance Institute and Millennium Entertainment also have offices in the William J. Pereira-designed, 31-story building, which is located across the street from the Los Angeles County Museum of Art. (Pereira designed that original campus as well.)

SBE, which operates hotels, restaurants and nightclubs such as SLS, Katsuya and Hyde, is planning a second SLS hotel in Los Angeles in the Grand Ave. development on Bunker Hill.

Variety will relocate to Penske’s corporate headquarters in Westwood.

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