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Warner Bros. Sells Burbank Studios for $375M

4 months ago

The entertainment company will continue to occupy space at the property as primary tenant. The post Warner Bros. Sells Burbank Studios for $375M appeared first on Commercial Property Executive.

The Burbank Studios is situated in the heart of the “media capital of the world.” Image courtesy of Worthe Real Estate

Worthe Real Estate Group, QuadReal Property Group and Stockbridge Capital Group have repurchased The Burbank Studios, a 685,000-square-foot studio and office campus in Burbank, Calif. Warner Bros. Discovery sold the 27-acre property for $375 million, equating to approximately $547 per square foot, public records show.

In addition, Warner Bros. provided $281.3 million in seller financing and will continue to occupy space at Burbank Studios as primary tenant.

Worthe and Stockbridge had originally purchased the property from NBCUniversal in a $249.6 million portfolio deal in 2007, according to CommercialEdge data. The partners then sold it to Warner Bros. in 2023.

Carrying the address 3000 W. Alameda Ave., The Burbank Studios features eight existing sound stages, production and creative office space. The property is situated in the city’s Media District, near the main studio lots and corporate headquarters of Disney, Comcast NBCUniversal and Warner Bros.

The new owners have ambitious plans for the campus, starting with the construction of five new sound stages, each ranging from 18,000 to 20,000 square feet.

Two decades of deals

In 2019, Worthe and Stockbridge started negotiating a property exchange with Warner Bros., transferring The Burbank Studios in return for four Warner Bros. properties: the 30-acre Warner Bros. Ranch on Hollywood Way and sites at 4001 W. Olive Ave., 3903 W. Olive Ave., and 111 N. Hollywood Way. This transaction closed in 2023.

The $1 billion agreement allowed Warner Bros. to continue leasing the four properties, while Worthe and Stockbridge moved forward with constructing Second Century, two new office buildings on the 7 acres they retained in the deal, with designs by Frank Gehry. Additionally, they planned to redevelop the 30-acre Warner Bros. Ranch with 16 new soundstages and a 320,000-square-foot office complex.

When construction of the Second Century project began in 2019, the developers secured a $594.2 million construction loan from The Blackstone Group, according to CommercialEdge data.

Further financing was obtained earlier this year, in a transaction led by Wells Fargo and Morgan Stanley. The $475 million fixed-rate CMBS loan was the first single-asset, single-borrower note of this kind to close since early 2022.

The post Warner Bros. Sells Burbank Studios for $375M appeared first on Commercial Property Executive.