Culver City Secures $103 Million Purchase Option for Vacant Sony Pictures Campus
Culver City holds the exclusive right to buy the entirely vacant, three-building, 198,000-square-foot creative office campus at 9050 Washington Boulevard for $103 million. The deal values the downtown Culver City real estate at $520 per square foot if the city proceeds following due diligence.
City Evaluates $103 Million Potential Acquisition
The city has until late February to complete its evaluation and has agreed to put down a $375,000 deposit. Local officials are currently considering redeveloping the campus, per the Culver City Observer. The $103 million potential acquisition price sits below the roughly $160 million that Michael Hackman’s firm spent to acquire the property in 2021 for Sony Pictures Animation. At the same time, the figure nearly covers the $104 million in unpaid debt remaining after the default and exceeds the $71 million credit bid that initially granted the lender ownership.
Lender Takeover Following Hackman Capital Default
Fortress Investment Group acquired the initial $100 million loan on the Washington Boulevard campus from Goldman Sachs three years ago. Over the summer, Fortress foreclosed on the asset to take full control. A representative for Hackman Capital Partners addressed the default in a September statement. After the single long-term occupant left the office campus, they evaluated multiple leasing and alternative asset strategies, including redevelopment, and ultimately determined that putting additional capital into the asset was not in the best interest of their investment.
Broader Distress Across Major Production Studios
The Culver City transaction unfolds amid a broader wave of financial distress for Hackman Capital Partners across several high-profile entertainment properties. The firm defaulted on a billion-dollar loan tied to the Radford Studio Center before losing it to a Goldman Sachs syndicate, clearing the way for Netflix to potentially acquire the iconic production campus at a discount. Hackman is also in default on Manhattan Beach Studios, owing approximately $258 million. Separately, a Deutsche Bank lender syndicate initiated action on Television City, alleging that Hackman owes $357 million as brokers actively market the production campuses.
Culver City Campus Acquisition Questions
Who previously owned the 9050 Washington Boulevard property?
Hackman Capital Partners owned the creative office campus until the firm defaulted on its debt, allowing lender Fortress Investment Group to take over the asset through foreclosure over the summer.
What is the timeline for the city’s decision?
Culver City has until late February to complete its due diligence and finalize its decision on whether to exercise the $103 million purchase option.
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