CIM Group Sells Historic L.A. Studio to Itself As Part of $230M Recap

After years of searching for a buyer, the owner of an 11-acre studio campus in West Hollywood, Calif., finally opted to take the path of least resistance: selling the property to itself. 

Los Angeles-based investment and development firm CIM Group sold The Lot at Formosa, a roughly 107-year-old production studio, to an LLC that shares CIM’s Mid-Wilshire address, according to property records. The trade price was $229.8 million. The Real Deal first reported the news. 

Blue Sky Servicing, which also shares an address with CIM Group, provided a $155 million acquisition loan toward the deal. The financing replaces $150 million of debt tied to the studio from a fund linked to AllianceBernstein, records show. A spokesperson for CIM Group described the situation in an email to Commercial Observer as a “recapitalization” that was “approved by an independent committee.” 

The spokesperson declined to comment further, or to provide additional information. 

CIM Group has owned The Lot at Formosa, at 1041 North Formosa Avenue, since 2007, paying just $15 million for the storied studio at the time. The company has done much work on the property since then, including modernizing and expanding its infrastructure, and constructing three new office buildings and a restaurant. The studio campus now encompasses more than 540,000 square feet across seven soundstages, support space and creative suites. 

Originally built in 1918, the lot has hosted productions of legendary films such as “Apocalypse Now,” “West Side Story,” “The Green Mile,” “Fear and Loathing in Las Vegas” and “Se7en.” Douglas Fairbanks and Mary Pickford once owned the studio, and Frank Sinatra recorded albums and films there during the 1950s and 1960s. 

HBO inked a 161,108-square-foot, long-term lease at the studio in 2021, and Miramax inked a 16,000-square-foot headquarters lease there in January. Other tenants include Live Nation, digital media company Dotdash Meredith and nonprofit Australians in Film.

CIM Group had been trying to sell the studio since mid-2022, though apparently had issues finding a buyer. That’s not necessarily surprising, given the state of Hollywood productions in the wake of the pandemic and industry strikes. Production levels in L.A. are down 50 to 70 percent compared to their pre-pandemic peaks, CO reported earlier this year.

Yet studios and soundstages — particularly well-known spaces — are still attracting investors. That includes singer-songwriter and Dead & Company frontman John Mayer, who along with film director and producer McG purchased Hollywood’s Jim Henson Company Lot for roughly $45 million late last year. 

Nick Trombola can be reached at ntrombola@commercialobserver.com.