Inside Capitol Records’ Newly Redesigned Digs (Exclusive)

This story first appeared in the Dec. 20 issue of The Hollywood Reporter magazine.

As Los Angeles Buildings go, it doesn’t get more iconic than the Capitol Records tower at 1750 N. Vine St. Constructed in 1954, when Frank Sinatra and Rosemary Clooney were topping the charts, the 150-foot-tall structure was the first in Hollywood to have central air conditioning and, at the time, was the only building to feature floors in the round, as part of its vinyl record-inspired aesthetic. (The spoke at the top? A needle.)

PHOTOS: Capitol Records Building Gets Transformed

Scores of legendary musicians — from the Beach Boys to the Beatles, Nat King Cole to Judy Garland — have roamed its halls, which now are home to Capitol Music Group, a wholly owned subsidiary of Universal Music Group. (UMG bought EMI’s recorded music arm in 2012 for $1.9 billion.) Today, Katy Perry and Arcade Fire rule the roster — the former reaching gold status on her latest album, Prism, which has sold 524,000 units since Oct. 22, the latter seeing a successful follow-up to the Grammy-winning 2010 album The Suburbs — but thanks to the steady stream of veteran artists booking time in the famed Capitol recording studios, housed in the tower’s basement, random run-ins are still de rigueur.

 

Take, for example, a recent anecdote recounted by CMG chairman Steve Barnett involving newly signed L.A. singer-songwriter Banks. After her first meeting in the offices, “She was heading out and when the elevator door opened, standing there was Mick Jagger, Ringo Starr, Bill Withers, Don Was and Joe Walsh,” says Barnett. “They looked at her, she stopped, she couldn’t even move. She came back up and said, ‘Is this how it always is here?’ ”

Therein lies the magic of this landmark address, a place that has curated the soundtracks to multiple generations. But despite its inviting exterior, the building, and the company it housed, have suffered years of slow decline. After the record company boom of the 1980s, when the likes of Duran Duran and Heart moved tens of millions of pricey LPs, and the bloated greed of the ’90s (when music fans reacquired their album libraries on CD) came the great cash-out of 2006, when then-EMI heads Alain Levy and David Munns sold the building and adjacent properties for $50 million. The move was followed in due haste by a sale of EMI to Guy Hands’ Terra Firma for $8.3 billion, only to see it taken over by Citigroup four years later after a contentious legal battle over the buying price, which the bank helped negotiate.

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That’s right, the Capitol Tower is a rental for the company that made it famous. (That might change soon, says a source, noting UMG chairman Lucian Grainge‘s deep pockets.) But then again, today’s Capitol doesn’t let its legacy distract from the bottom line: signing top acts across multiple genres; developing, promoting and marketing them to as large an audience as possible; and monetizing their music from every angle — any and all new ideas welcome.

“Great companies are built on great communication, and I want even the youngest person in this company to have a voice,” says Barnett. “They should feel [like] they can speak up. My door is open any time in the day. Anyone walking past can come in and talk to me.”

It’s a philosophy that extends to the look of the newly revived Capitol. The building underwent a multimillion-dollar renovation beginning in December 2012, one month ahead of Barnett’s start date. The former AC/DC manager and lifelong “record man” came from Columbia, where he was co-chairman and COO — and No. 2 to label boss and fellow Brit Rob Stringer. At Capitol, the freedom to run the company his way (with a sense of barely restrained urgency and a dash of charm), with the full support of Grainge, meant a complete makeover.

“This is probably the greatest entertainment office in the world, so why wouldn’t you make it look great?” Barnett says of the formerly drab gray floors stacked with dated file cabinets and clunky doors. Today, all 13 stories feature glass. “I want it to be open,” he adds. “I want people to see that we’re here, so there’s lots of glass and light.”

Barnett’s very first meeting in the rehabbed executive floor was with Perry. “The past three years have been such a difficult time for the company, and she was acutely aware of that,” he says. “I thought it was important that Katy come in and see what it would look like finished. She was, like, ‘Wow, it looks good!’ Probably because it was the antithesis of before.” Asked to describe what Perry means to the company, he doesn’t mince words: “She’s quite simply the most important artist on the label.”

STORY: Arcade Fire Rocks From the Top of Capitol Records

Barnett’s 559-square-foot office, adorned with little more than vintage concert posters and a collection of signed guitars, is adjacent to a conference room with a stunning 160-degree view of Hollywood and the hills. The white of the Carrera marble table only makes the room brighter.

Tasked with executing Barnett’s marching orders are executive vice presidents Greg Thompson (a carryover from the old regime whom Barnett credits for “doing a brilliant job in the toughest circumstances”) and Michelle Jubelirer, a respected lawyer who’s taken charge of dealmaking. Both sit within shouting distance of Barnett — and that’s a good thing, since the CMG captain often does. “He’s a kind of visionary ‘coach’ [where] it’s all about teamwork,” says Jubelirer. “I’ve never been more inspired.”

The company has long supported genre-specific imprints, and that will continue — but with more gusto than ever. On the sixth floor, in a Moroccan-themed office with multitudes of throw pillows and a mini stage, is producer RedOne, the man behind such hits as Jennifer Lopez‘s “On the Floor” and Lady Gaga‘s “Bad Romance,” who runs his own 2101 Records. Heading Harvest Records, the storied U.K. label that was home to Pink Floyd and Deep Purple in the 1970s, are co-GMs Piero Giramonti, formerly a global marketing executive at Warner Bros. Records, and Jacqueline Saturn, last stationed at Epic. Modeled after XL Recordings, which discovered Adele, it’s the indie heart of CMG.

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On the ninth floor, Don Was, the chief creative officer of the famed jazz label Blue Note Records (home to Norah Jones and Bobby McFerrin), represents a proud nod to the past. Showing off a vintage mixer in his office, where he’s usually barefoot, Was marvels at the environment in which he’s found himself. “It’s like in the old Atlantic Records days when they’d push the desks aside and make records,” he says excitedly.

Running the revived Virgin Records from the 12th floor is Ron Fair, the former chairman of Geffen who helped break Christina Aguilera and Pussycat Dolls. His retro-styled office is where he hosts A&R meetings and directs staff to “make it rain” with future pop stars. Says Fair: “Each floor has a different personality. It’s really remarkable. Steve is a man of action with phenomenal taste … who took on what few people would have the perseverance to do: meet the challenge and remodel the entire tower.”

UMG’s Grainge agrees. “When we acquired Capitol, we made a commitment — both to the artist community and to the industry — that we would revive this once-great label,” he says. “We committed to reverse its years of suffering from under-investment; to provide it the kind of leadership it needs and deserves. Looking at Capitol today, I am enormously proud to see what Steve and his team are doing to return this iconic company to its prior greatness. … The building is buzzing.”

What won’t you find in the new Capitol Records? Any seismic retrofitting efforts. (A Los Angeles Times report in October concluded that the concrete building could collapse should a major earthquake strike.) Says operations manager Maureen Schultz, “It’s been there a long time and lived through many an earthquake.” And good luck spotting a framed gold record, the requisite but often corny symbol of commercial success for a music company. As Barnett explains, “I have so much respect for the history of this company, but it’s really about the future.”

See a gallery of the newly renovated Capitol Records tower here.

Twitter: @shirleyhalperin