NBCUniversal Cuts Residential Development from Backlot Plan
The 20-year development plan would have included 2,937 units in a neighborhood on the 391-acre backlot.
NBCUniversal has canceled plans to build a large residential neighborhood on its backlot property in Universal City.
The development of 2,937 apartments, condominiums and single-family houses was part of a 20-year effort that would transform the 391-acre Universal Studios backlot with upgraded studios, a hotel and a revamped CityWalk shopping mall, among other features. Other aspects of the plan remain in place. While the original project was expected to cost $3 billion, NBCUniversal said its new proposed development would cost $1.6 billion.
The project, which has been reviewed by the Los Angeles Department of City Planning since 2006, still needs approval of its final environmental impact report. According to NBCUniversal, a "no residential" development alternative will be included as part of the final EIR in order to address comments from community stakeholders and elected officials. This is the version of the plan that NBCUniversal would pursue.
"After taking a hard look at the project, the current real estate market, our business needs and the needs of our surrounding communities, we believe it's best to ask the City and County to focus on our 20-year plan without any residential development and to retain our backlot for production," Universal Studios president Ron Meyer said in a statement.
The project, which is called the NBCUniversal Evolution Plan, was conceived during the boom years -- well before the recession wiped out demand for housing. The "no residential" development alternative would include about 200,000 square feet of additional studio square footage that the original plan did not feature.
In all, the new plan calls for 1.45 million square feet of studio space; 327,000 square feet of theme park attractions, retail and dining development; and two hotels. The final EIR has deemed the "no residential" plan to be the "environmentally superior" alternative, according to NBCUniversal. The company said it still would invest the $100 million in transportation and traffic improvements that it had previously pledged.
"This is the right time in the process to make this decision, and it will enable us to concentrate and invest in our core businesses: television and film production, Universal Studios Hollywood Theme Park and CityWalk," Meyer said. "Planning for our future in a way that is responsive to the community has always been a priority of the Evolution Plan. Today marks the next step in making this important project a reality."
Los Angeles County Supervisor Zev Yaroslavsky and City Councilman Tom LaBonge, who represent the section of the San Fernando Valley that includes the project area, issued a joint statement that indicated their support for NBCUniversal dropping the residential component of the Evolution Plan. The prospective neighborhood would have been situated on the southeast section of the backlot, near Barham Boulevard.
"I have always opposed this kind of development on the NBCUniversal backlot," LaBonge said. "I want to see balanced development, and I support investments that would protect and upgrade the studio complex."
The final EIR could receive governmental approval by the middle of 2013; both the city and county must certify it. If the development were approved, NBCUniversal could break ground on the project shortly thereafter.
Opting for a smaller Evolution Plan development isn't the only big real estate decision NBCUniversal has made in recent months. In January, NBCUniversal pulled the plug on a planned 1.5 million-square-foot production and office project that would have been built atop a subway station on Lankershim Boulevard across from Universal Studios.
The two-phase development, which was to be called [email protected], would have cost $750 million and would have been built by L.A.-based Thomas Properties Group, owner of downtown Los Angeles office properties City National Plaza and 800 South Hope. NBCUniversal would have occupied [email protected] as the anchor tenant.
"In light of NBCU's changing requirements for office and postproduction space, the planned [email protected] project was not considered economically viable at this time," Thomas Properties stated in a Jan. 3 SEC filing.
Email: [email protected]