EXCLUSIVE: William Morris Headquarters for Sale
The agency's three-building Beverly Hills complex -- already in the process of being foreclosed on -- will be auctioned next week.
Want to own the longtime headquarters of one of the most storied talent agencies in the world? Here's your chance.
William Morris Agency's iconic headquarters -- already in the process of being foreclosed on -- has been put up for sale. The company's successor agency, WME, and Live Nation Entertainment are tenants at the three-building Beverly Hills complex, known for its famed address: One William Morris Place.
Lender Brickman, a New York real estate investment firm, is selling the loan that owner Cape Horn Group took out to buy the property from WMA in 2008. The note will be auctioned Oct. 27, and the winning bidder would take over the property through the foreclosure process. The buildings at 150 and 151 S. El Camino Drive and 150 S. Rodeo Drive are just steps from the Beverly Wilshire Hotel in a prime section of Beverly Hills. The facility dates to the early 1950s.
WMA sold the property to Cape Horn, a Chilean company with offices in Miami, for $143 million. The 182,649-square-foot complex traded for $783 per square foot, among the highest per-foot prices ever paid for a Los Angeles-area office property. But the commercial real estate market has changed dramatically since then.
No one was speaking on the record Monday, but real estate industry sources said a sale at auction was far from a sure thing because the property is now worth less than the outstanding debt on it. About $90 million is owed on the note. If the loan isn't sold at auction, it's believed Brickman would complete the foreclosure and market the property in a more traditional sale.
One source pegged the value of the property at about $80 million, though it has long been tough to get a bead on commercial real estate values because of the lack of transactions during the protracted real estate slump.
The agency, which long occupied both El Camino Drive buildings, began leasing space in the complex from Cape Horn after the sale. WME now occupies a portion of the two buildings; the firm's commercial and music departments are housed there, along with part of its accounting group. The firm will soon be consolidating all of its operations at the facility into the 150 S. El Camino Drive building, according to sources. WME has been headquartered nearby at 9601 Wilshire Blvd. since April 2009.
At the time of the September 2008 sale, WMA said it planned to stay at the El Camino facility until a new Beverly Drive building it planned to occupy was complete. However, the agency's 2009 merger with Endeavor threw a kink into those plans. WME has backed out of an agreement to occupy the new building, built by New York-based commercial real estate firm George Comfort & Sons. The matter is subject of an arbitration hearing between WME and the developer next month. Meanwhile, rival agency UTA is said to be interested in the Beverly Drive building.
The El Camino Drive buildings should be nice enough, at least for now. They total 111,807 square feet, and the Rodeo Drive building features a two-story "domed cathedral lobby" and a 53-seat screening room and rooftop deck, according to offering memorandum from commercial real estate brokerage Cushman & Wakefield, which has the listing.
"The properties are distinguished by their striking architectural designs, grand marble lobbies, open atriums and extensive use of outdoor space," according to the Cushman & Wakefield documentation.
Despite all the changes, and the fact that WMA no longer exists, a spokeswoman for the city of Beverly Hills said there are no plans to remove street signs designating the stretch of El Camino the complex fronts as William Morris Place. The honorific street signage was bestowed in 1998 to commemorate the firm's 100th anniversary.
WME and Brickman declined to comment. Marc Renard, the Cushman & Wakefield broker who has the listing, did not return calls seeking comment. Eduardo Covarrubias, co-founder of Cape Horn, also did not return calls.