Victor Coleman, Hudson Pacific Properties
Victor Coleman
CEO at Hudson Pacific Properties
Victor Coleman has assembled prominent office and studio portfolios in Los Angeles since he created Hudson Pacific Properties 14 years ago, with a tenant roster that includes Google, Netflix, HBO, Disney and Fox.
But, in the face of a stalled and inactive economy this summer, Coleman closed what will likely be L.A.’s deal of the year. Coleman and Hudson, a publicly traded real estate investment trust (REIT) based in West L.A., scored a joint venture deal with Blackstone to expand the studio portfolio. CO first reported that Blackstone purchased a 49 percent stake in Hudson’s Hollywood media portfolio, which was collectively valued at $1.65 billion and spans 2.2 million square feet.
“The deal unlocked a significant amount of the value we’ve created over the last 10-plus years in Hollywood, and it positions us well in terms of liquidity for future growth as we look to reinvest in new studio and office opportunities,” Coleman said in an email.
Studios continue to see sustained growth and demand, with average rents increasing in the entertainment and media capital of the world. According to CBRE, over the past three years, the progression of streaming and content creation led to about a 20 percent increase in rents in Hudson’s soundstages. Hudson also collected 97 percent of its total third-quarter rents amid the downturn, including 100 percent of studio rent, which is consistent with collections before filming ramped up.
Now, all of Hudson’s 35 stages are nearly 100 percent active, and “there’s significant pent-up demand for streaming content and production facilities due to the pandemic,” Coleman said.
“Netflix, Amazon, AppleTV, Hulu, Disney+ and HBO Max had tens of millions of new subscriptions this year,” Coleman said during his company’s third-quarter earnings call. “Now, 80 percent of U.S. consumers subscribe to at least one streaming service.”
The firm is also currently advancing expansion plans. The L.A. Planning Commission recently approved another 480,000 square feet at Sunset Gower Studios. Hudson’s Harlow project received a certificate of occupancy, and crews topped off structural steel at Hudson and Macerich’s One Westside — a massive office development pre-leased to Google that is set to open in 2022.
More than half of Hudson’s 2.7 million-square-foot pipeline is fully entitled. Coleman said that, beyond its L.A. activity, Hudson is also actively pursuing studio acquisition and development opportunities in markets like Vancouver, Toronto, New York and London.—G.C.
