By PAT KRAMER Contributing Reporter When Peggy Phillips moved to Los Angeles in 1985, her goal was to produce dinner shows reminiscent of the elegant productions of the ’40s. “I wanted to work with the best talent I could find,” says Phillips. “But I also wanted to give the public the ability to get involved in the show.” After realizing that her choices came down to New York or L.A. for finding the best talent, she moved to Burbank with $10,000 to invest in her business. The result was “Dial M Murder Mysteries,” a show written and produced by Phillips and staged at area restaurants. In the show, actors mingle with the audience between courses and at the end are challenged to solve the “whodunit.” Most of the shows are staged for companies that pay $1,500 to $2,000 a performance, depending on the size of the crowd (usually groups of 25 or more). Individuals pay $65 for the show, which includes dinner, tax and tip. After writing the script and forming her Burbank-based company Dial M Productions, Phillips auditioned 200 hopeful actors to select a cast of 10 to perform in the show. At first, it played every weekend at the Sheraton Universal. Th first show cost Phillips $1,000 to stage, but after only five months Dial M was out of the red and earning a profit, enabling her to hire four additional casts as the show gained in popularity. By the time Dial M came on the scene, interactive theater was no longer completely novel. Locally, people had already experienced the show “Tamara,” which took its audience on a tour of a three-story mansion as its characters acted out their parts. Like Tamara, Dial M requires the audience to follow the characters and watch their every move. The difference, says Phillips, “is that with Tamara, you were like a fly on the wall; the characters pretended that they didn’t see you. So if they were running down a hall, you had to get out of their way. In my show, you go up to the characters and they act like they know you or pose as audience members.” She notes that the audience is encouraged to speak to the cast and to get clues from them to solve a series of murders that takes place during the show. “In other murder mysteries, you know who all the other actors are, but in this thing, you really have to pay attention because there’s a lot of red herrings,” adds Jay Richardson, who has been acting with Dial M for 10 years. In addition, the cast personalizes each show with information it receives about the guests. “Like when we get a profile of the company, we’ll know who’s the big talker who wears the sharpest clothes and thinks they’re a ladies man,” said Mark Felicetti, who plays the first victim in the murder mystery. “It’s fun for the actors and the audiences love it because they’re basically laughing at themselves.” With five casts performing by 1989, business was booming for Dial M, a year that yielded revenues of over $250,000. With the Mirage, Tropicana and other major hotels in Las Vegas interested in hiring the company for long-running shows, Peggy added a second interactive production to the repertoire, “Frankie and Mia Tie the Knot.” But the recession and the L.A. riots began taking their toll in the early ’90s, says Phillips. “The public was not going out as much. If I hadn’t developed the corporate niche market, my company would have gone under like many other performing companies at that time.” In 1992, after giving birth to her son Jesse, Phillips started cutting back on the shows for the general public and focused on corporate and private parties. “Peggy was a real go-getter,” said publicist Diane Carter of Carter Communications, a Studio City entertainment publicity firm that is not connected with Dial M. “Of all the people who were doing murder mysteries, Peggy gave it a very good effort and she was good at finding talented people who could portray the different characters.” Both shows are performed primarily at two places, the Stinking Rose in Hollywood and Spencer’s in Pasadena. “It’s not an original idea,” notes Stinking Rose Events Coordinator P.K. Keller, “but it seems to go over very well with individuals as well as corporate clients. It’s really a good ice-breaker when people don’t know each other.” The company performs six to eight shows a month on average, with the most business coming in December with the holiday party season. Last year, the company had 27 bookings between Dec. 1 and Christmas, Phillips said. One client, Paragon Implant Co., an Encino-based manufacturer of dental implants, hired Dial M for a three-day event in Aruba for its VIPs. “What’s so unique about them is that, if you cooperate and give them information about your audience, they’ll tailor their performance and make it hilarious,” said Ginger Page, the company’s sales support manager. Page has hired Dial M on several other occasions, most notably for a New York trade show. “We called it “Death By Chocolate,’ ” she said. Felicetti, who plays groom Frankie Fettuccini in one of the shows, calls the interactive aspect of the show “challenging” to the actors involved. “You have to really stay on your toes and think while you’re moving because the audience is different every time,” he said. “They’re either talking to or interacting with the characters in the show. And while we have a scripted dialogue, you need to be sharp so if people throw something out at you, you come back with something funny and entertaining to keep things moving.” With October to March the busiest time for Dial M Productions, Phillips and her four casts (two for each show) remain busy, putting the finishing touches on the latest version of the murder mystery – which it constantly revamps.

By JOYZELLE DAVIS Staff Reporter As developers race to get the financing together for a host of major office projects in the hot Burbank Media District, J.H. Snyder Co. will apparently be first off the blocks after announcing it will break ground on its Burbank Media Center project next month. Snyder is partnering with Boston-based real estate investment trust Beacon Properties Corp. to build the six-story, 585,000-square-foot office center, located adjacent to the NBC studio lot. The Snyder Co. will design, construct and lease the $140 million project, and Beacon will provide the financing and own the building once it is completed. Beacon was acquired in September by Chicago-based Equity Office Properties Trust, and the merger is expected to be completed within about four months. The acquisition should not affect the Snyder project, said Alex McCallum, a spokesman for Beacon. This is Snyder’s first partnership with a REIT, and Beacon’s first development project outside of Boston. The Media Center is planned as a lowrise campus with a large atrium and balconies. The architectural firm McLarand, Vasquez & Partners, which worked with Snyder on the Water Garden office project in Santa Monica and the Wilshire Courtyard in Los Angeles, will design the project, which is scheduled for completion in summer 1999. Snyder has not signed any tenants, although the developers are in “active negotiations” for about 200,000 square feet of space, said Clifford Goldstein, a partner with the Snyder Co. Office vacancies are effectively non-existent in the Burbank Media District, which had a vacancy rate below 1 percent for the first half of 1997. Accordingly, the Media District gets the highest rents in the market an average of $26 per square foot annually, compared to the county average of $18 per square foot. Brokers representing the Burbank Media Center project are asking for rents from $34.30 to $37.20 per square foot. Drew Planting, director of Cushman & Wakefield California, said those prices are in line with the market. “The Media District is the most prestigious address in town,” he said. “It’s ground zero.” And after a five-year lull in development activity, ground zero is poised to see some churned earth. The Snyder project is only the first of several new projects about to break ground in Burbank. About 7 million square feet of commercial development have been entitled for the city over the past five years, said Robert Tageue, Burbank’s community development director. “Thanks to the studios, we had an enviable vacancy rate even during the recession,” said Rick Pruetz, a Burbank city planner. “And now that the economy has improved, everyone wants to build here.” Pruetz said he spends an increasing amount of time showing developers aerial maps of the city as they look for available land. When people are looking for sites in the Media District, Pruetz often suggests that they approach the owners of surface parking lots and offer to buy the land for redevelopment.

BY JOYZELLE DAVIS Staff Reporter Dr. Omid Javaherian recently purchased a new home in Tarzana for $963,000, and as soon as escrow closed he already had received an unsolicited offer to buy the 7,000-square-foot home for $1.15 million. Javaherian said the offer was tempting, but he ultimately decided against it because his wife adores the six-bedroom home and after spending seven months to find the house, he didn’t want to join the stampede of home shoppers again. “It’s rough out there,” Javaherian said. Realtors and home buyers across the Valley have similar tales of a feeding frenzy for homes in upscale markets. Spurred by growing confidence in California’s economy and stock market profits, many affluent Valley residents who had put off purchasing a larger home during the recent housing slump are now pounding the pavement before the market skyrockets. Already, the rise in home prices already has been remarkable. The median price of a La Canada Flintridge home during the second quarter, at $462,500, was up 20.1 percent from the first quarter, according to the California Association of Realtors. Double-digit increases in median home prices for the second quarter also occurred in Studio City, Glendale, Sherman Oaks and Tarzana. The volume of homes being sold in those communities was also up markedly in the second quarter, with Calabasas and Tarzana posting increases in excess of 50 percent over the first quarter. The surge in the prestige housing market is not limited to the Valley; that segment is fueling a residential real estate recovery for the entire county of Los Angeles. The 8,859 homes sold in Los Angeles County during July was 15.2 percent more than were sold in July 1996. The July median price of $172,000 was 4.2 percent higher than the July 1996 median, according to Acxiom/DataQuick Informations Systems, a real estate research firm. G.U. Krueger, deputy chief economist for the California Association of Realtors, said more people are jumping in to buy homes as prices are appreciating. “People can finally expect some return on their investment,” he said, adding that activity in the upper-end market creates a ripple effect that lifts all segments of the housing market. “It’s like the art market: If you can’t get a Picasso, you go for a Matisse and bid up the price of a Matisse. So you end up with something from that (painter) in Carmel.” Some San Fernando Valley communities, such as Encino, Sherman Oaks and sections of Tarzana, are particularly hot. Kathy King, manager of the Prudential Jon Douglas Co. Realty in Encino, said 38 San Fernando Valley homes sold for more than $1 million during the first half of this year, compared with 20 for the first six months of 1996. She noted that Encino has been the most active prestige home market, with 10 homes selling for more than $1 million in the first half of this year. “It’s not that there are more homes on the market, it’s that there are more people purchasing homes,” she said. “There’s a general confidence in the economy. A number of these people who are purchasing the $1 million-and-above homes either own their own businesses or have compensation packages tied to the performance of their company’s stock.” As the Valley’s prestige housing market has become increasingly competitive over the past few months, multiple offers and unsolicited bids have become commonplace, said Realtor Hezy Es-Haghian. “Buyers looking for homes in the $1 million-to-$1.5 million range simply don’t have a lot of choices,” said Es-Haghian, a Realtor with Prudential Jon Douglas in Encino. “And there are a lot of buyers in the market who’ve been waiting on the sidelines for a long time.” Dr. Javaherian and his wife were renting an apartment in Encino before they purchased their house in Tarzana. He said they’d been watching the housing market for a year, and once prices began to rise they decided to “catch the cycle” before it rose beyond their reach. Realtors say that many home buyers are price conscious, and a house must be “priced right” to draw multiple buying offers. “It all comes down to price, and the buyer is the person who determines if the seller is asking the right price,” said Evelyn Lambert, a Realtor with MacGregor Realty Inc. in La Canada. “Some sellers don’t understand that, and they get too optimistic in their asking price.” After their listed home lingers on the market with little or no action, Lambert said, sellers often adjust their asking price downward to put it more in line with the market value. Some seasoned home buyers, however, say sellers’ asking prices are nowhere near a reasonable level. “Sometimes it can be so frustrating,” said Linda Boss, who is looking for a home in La Canada. “You’ll look at a home and things will be just OK, then you see the price and it’s insane.” Linda Boss and her husband, Greg, grew up in La Canada and are currently renting a home there for themselves and their five children. The Bosses have pounded the pavement for the past year and have seen sellers become more aggressive in their pricing. “We really hope that we can get into the housing market before this cycle (of rising home values) takes off again,” she said. Sheryl Lyons, who is looking for a home in the east San Fernando Valley, said most of the homes she has seen have been fixer-uppers that aren’t worth getting into a bidding war over. She and her husband and son have been living with her parents in Northridge for the past three months while they search for a home. As their search wears on, Lyons said her resolve to pay a “fair” price is increasingly challenged. “I can’t say if I’ll eventually end up paying more than I’d like,” Lyons said. “But I do know that I want to have a life; I don’t want to have house payments for eternity.” Market forces, however, do not seem to be working in the Lyons’ favor. The supply of Valley homes remains tight as more buyers enter the market. Some Realtors predict the recently passed federal budget agreement will encourage more people to sell their homes because sellers will no longer get hit with a capital gains tax on the first $500,000 of profit for married couples and on the first $250,000 for individuals. “At the moment, there’s simply no (housing) inventory,” said Julie Ritchie, director of relocation for Coldwell Banker. “But the market should gradually right itself as more sellers understand the new tax rule and feel comfortable that they can make a (tax-free) capital gain.”

By DANIEL TAUB Staff Reporter Six months ago, Bill Allen was assigned the task of developing a marketing plan for the San Fernando Valley an area that most of the world outside Los Angeles associates more with tract homes and strip malls than high-tech companies and movie studios. Allen and the organization he heads, the Economic Alliance of the San Fernando Valley, are now on the verge of launching an advertising and public relations campaign to let businesses both inside and outside the Los Angeles area know that the Valley is more than the suburbs and houses such major movie studios as Universal Studios Inc. and Warner Bros., such television studios as NBC Studios and CBS Studios Center, and such technology companies as Litton Industries Inc. Allen and other alliance leaders hope to attract new and relocating businesses to the Valley by showing them other major companies have had success in the area and by showing them the Valley’s other amenities. “A lot of people have no idea of the size or strength of the businesses that do exist in the Valley,” said Allen, who was named the alliance’s first president and chief executive last spring. The group was formed in the aftermath of the 1994 Northridge earthquake to promote the Valley as a place to do business, but has had no on-staff leadership until Allen’s arrival. In addition to attracting and retaining Valley businesses, the alliance also hopes to promote the area as a tourist destination and a place to live all to help nurture and grow the Valley’s economy. In order to spread the word to people both inside and outside the Valley about those businesses and the area’s amenities, the alliance has a variety of projects planned: – Organizing the “Valley Business Corps,” a group of at least 25 volunteers who will focus on business attraction and retention in the Valley (much like L.A.’s Business Team in Mayor Richard Riordan’s office does for the entire city). Most of the volunteers will likely be people already associated with the nearly two dozen chambers of commerce throughout the Valley, who will donate their time as part of their chamber activities. – Developing the “Valley Information Project,” an exhaustive study of taxes, demographics, top companies, employment, transportation, personal income, education and trade. It would be the first comprehensive study of the Valley’s economic make-up, and alliance leaders feel it is needed to effectively promote the area. Allen is hoping to work with Cal State Northridge’s Center for the Study of the San Fernando Valley Economy in the university’s school of business to conduct the survey. – Publishing three glossy magazines on the San Fernando Valley: “Visions,” which will cover the area’s business community; “Views of the Valley,” which will deal with the Valley’s lifestyle; and “Visits to the Valley,” which will focus on tourism. The magazines will be supplied for free to major businesses, hotels, business magazines, newspapers and government agencies. – Creating a one-year “Workforce Preparedness Job Survey” detailing what positions need to be filled at Valley companies, thus allowing local universities, community colleges and trade schools to train their students appropriately. The survey is being funded by a $300,000 grant from the Los Angeles City Council and will be conducted by the Valley Economic Development Center. The various parts of the campaign particularly the three magazines and an already-completed 10-minute video on the Valley to be used by chambers of commerce and given to businesses considering locating in the area will be based on the theme “Valley of the Stars,” referring to the entertainment industry’s strong presence in the area. Michael Collins, executive vice president of the Los Angeles Convention and Visitors Bureau, said he has been impressed by the alliance’s early efforts, and that the San Fernando Valley is sorely in need of such a campaign. “To me, that’s exactly the kind of thing that makes all the sense in the world. What they’re trying to do is focus on the virtues and characteristics of that part of the world as a place to do business,” Collins said. “The Valley has more of a geographic designation, but it has not been able to evoke a certain personality or character.” The alliance differs from the Valley’s other business organizations in that it is the only one that focuses specifically on marketing. The Valley Industry and Commerce Association serves as an advocacy group for small- and medium-sized businesses; the Valley Economic Development Center is devoted primarily to loaning money to businesses; and the United Chambers of Commerce of the San Fernando Valley is an umbrella group for local chambers. In order to pay for its various efforts, the alliance hopes to raise $7.5 million by the end of the year. It expects to pass the half-way point on that goal soon, Allen said. The money has been donated by the Daily News of Los Angeles, Universal Studios Inc., Atlantic Richfield Co., Pacific Bell and others. Kevin Tamaki, a director of external affairs with Pacific Bell, said that his company has donated $40,000 to the alliance and plans to donate more in the future because he feels the alliance will help grow the economy and improve the business climate in the Valley. That, he said, will be good for Pacific Bell and its 2,000 employees in the Valley. If the alliance succeeds in its goals, it will be good news for the Valley’s businesses. “They’ll be able to invest more; they’ll be wanting more telecommunications services,” Tamaki said. “The fund raising is going well, so we’re really beginning to implement some of these strategic initiatives,” said Allen, the son of entertainer Steve Allen. One of the first steps will be the Valley workforce survey, which is being funded by a $300,000 grant awarded by the Los Angeles City Council. The survey is expected to launch this fall and be completed by spring or summer of 1998. The Valley Economic Development Center, which the alliance has hired to conduct the survey, will interview hundreds of business leaders throughout the area. “We’ll hit, obviously, all the big companies and a lot of mid-size companies and probably some small companies,” Allen said. The information gathered will then be compiled to create a database of information about the job needs of Valley businesses, Allen said. The Valley Business Corps is expected to be a less cost-intensive effort, with most of the 25 to 30 members offering their help as volunteers. Only one person the group’s coordinator will be on the alliance’s payroll. The others will likely be representatives of chambers of commerce from Glendale, Burbank, Calabasas, San Fernando and the Valley portion of Los Angeles. One function of the corps will be to deal with requests and questions that result from the information contained in the alliance’s three magazines “If a business reads about your opportunities, you have to be able to respond to that,” Allen said. Jack Kyser, chief economist with the Economic Development Corp. of Los Angeles County, said the alliance is needed to dispel old stereotypes about the Valley. “Sub-regional groups like this are going to prove very important to the future of Los Angeles County,” Kyser said. Other upcoming alliance projects include a pair of meetings on the Valley’s transportation issues, improvement of the group’s World Wide Web site and the placement of informational kiosks at the Burbank-Glendale-Pasadena and Los Angeles International airports. Many of the alliance’s efforts such as publication of the magazines and the formation of the Valley Business Corps will come together in the fall as part of a cohesive campaign, Allen said. “I didn’t want to do things in dribs and drabs,” he said.

By JOYZELLE DAVIS Staff Reporter The Los Angeles Community Redevelopment Agency has labored for almost two decades to shake North Hollywood’s image as a seedy area. But as adjacent office submarkets flourish, some hope that market forces might be able to do what the government so far hasn’t. North Hollywood seems like a logical and economical location for companies that can’t find or afford space in popular Burbank and Glendale: it’s close to the same labor pool and clients as the Media District, annual per-square-foot rents for Class A office space are $3 to $7 less, and the CRA offers tax incentives to entertainment companies that relocate their headquarters to the North Hollywood redevelopment project area. So far, though, most companies aren’t biting. Walt Disney Co. made the biggest splash when it moved its online division into the 5161 Lankershim Building in October, but no other major media companies have followed. Andrew Feola, a broker with commercial brokerage Ramsey-Shilling Commercial Real Estate Services Inc. in Toluca Lake, said many of his entertainment industry clients are increasingly asking him to look for office space in North Hollywood but they ultimately decide against moving. “No one’s really taken the plunge,” Feola said. “A lot of clients are still holding out that something good will open in Burbank.” Burbank has been one of the tightest office markets in the county for years; its vacancy rate as of the end of the second quarter stood at 3.8 percent. Glendale isn’t far behind, with an 8 percent office vacancy rate. North Hollywood posted a 13 percent vacancy rate, even though its inventory of Class A and B office space is much smaller, with 978,435 square feet of rentable space spread over 10 buildings. By comparison, Glendale has more than 4 million square feet of Class A and B office space and Burbank has almost 3 million square feet. With such scant quality office space limiting the size of the business community, North Hollywood has trouble generating the critical mass of restaurants, banks and dry cleaners needed to attract new office tenants, said Walter Beaumont, assistant project manager for the CRA’s site office in North Hollywood. “It’s the chicken and the egg problem,” he said. “If we had additional office space, we could support the amenities that would help us attract more companies.” As it is, North Hollywood still has a ways to go before it can be considered a rival to Burbank and Glendale. Aside from the building that houses Disney’s online division, the only major entertainment site in North Hollywood is the Academy of Television Arts and Sciences building, home to a division of Warner Bros., Landmark Entertainment and a division of Disney. Most of those tenants have been in the Academy building since it opened six years ago. The 160,000-square-foot building is actually the first phase of what is planned to be a six-phase, $144 million project. The first-phase building and the second phase, consisting of 248 housing units, were completed in 1991. Phase three is planned to be a 200,000-square-foot office building on Lankershim Boulevard, for which the CRA plans to issue a request for proposals this month. As with almost all CRA projects, the agency is seeking a developer willing to buy the site and develop the project, with certain assistance from the agency. Phases four through six have been designed to add another 750,000 square feet of office space and 75,000 square feet of retail space. Development of phases three through six had been stalled by a lawsuit filed by several nearby property owners. That lawsuit was settled in the CRA’s favor in July, although as part of the ruling the CRA will have to conduct the public hearing component for the remaining phases of the redevelopment project again this month. Once that’s complete, the CRA will adopt a plan amendment to increase its eminent domain powers and the amount of money it can raise through the bond market. Those amendments are subject to City Council approval. For now, the project has “no developer, no plan amendment and no eminent domain,” Beaumont said. But he added that the CRA hopes to have all six phases of the project complete by 2013, when the agency’s ability to raise funds through bond issues expires according to the CRA plan. Even if plenty of premium office space is built in North Hollywood, the community will have another battle to wage: its reputation as a crime-ridden and desolate area. “Entertainment companies are often perceived as having a funky image,” said Todd Doney, senior vice president with Cushman Realty Corp. “But when it comes down to it, they’ve got the same concerns as an institutional company like AT & T; such as employee safety and efficiency. North Hollywood still has a number of issues as far as crime and the quality of amenities.” Beaumont counters that the district’s crime rate has steadily dropped, and that new coffee shops and restaurants such as the upscale Pit-Fire Pizza Company will open in North Hollywood’s redevelopment district within the next few months. Beaumont isn’t alone in his optimistic assessment of North Hollywood’s potential. Prentiss Properties Trust, a Dallas-based office and industrial real estate investment trust, purchased the 194,000-square-foot Academy building from The Academy Venture, a limited partnership, in late July. David Robertson, Prentiss’ director for the Western region, said he and other Prentiss officials feel North Hollywood “provides a natural corridor for the entertainment industry from Burbank, and we feel that the market will continue to grow.” North Hollywood has attracted a number of smaller, entrepreneurial media companies in recent years. The Los Angeles Recording Workshop a recording, engineering and film production school converted a bank building into a studio when it moved from Studio City to North Hollywood two years ago. The school recently purchased an adjacent 30,000-square-foot lot to expand the school. Christopher Knight, director of the school, said the decision was made to move to North Hollywood because it was “millions of dollars cheaper” than a Santa Monica location and the CRA provided loans and assistance in securing building permits. The school has since decided to expand its North Hollywood presence because “we see it as the next big place (for the industry),” he said. “We’re expecting the commercial value of our investment to go up” as more companies move into North Hollywood, he said. That will ultimately depend on whether the overall commercial real estate market continues to improve as well as on the preferences of entertainment companies, said Bill Boyd, senior vice president with CB Commercial Real Estate Group Inc. in Glendale. “North Hollywood is not a player with the (entertainment industry) right now, but it will be in the next three to five years only if there’s a continued lack of space” in adjacent markets, he said. But with more than 2 million square feet in proposed office projects in the early stages of development in both Glendale and Burbank and the 500,000-square-foot Glendale office tower currently under construction by PacTen Partners and Morgan Stanley & Co. entertainment companies might not have a need to look outside of those two cities for new office space. But in real estate as in most businesses it’s tough to predict future trends. “Only in the last three years with the growth of the entertainment industry has Burbank and Glendale become this magical office area,” Doney said. “It wasn’t long ago that Burbank was best known as the butt of Johnny Carson jokes.”

By BOB HOWARD A Santa Monica-based developer is hoping there will be enough demand from Hollywood studios and warehouse operators to fill more than 440,000 square feet of new industrial space to be built at a former Litton Industries site in Van Nuys. The Lewis Co. recently bought 16.2 acres of former Litton land at Strathern Street and Woodley Avenue for just over $7 million and has an option to buy an additional 4.6 acres at the site, according to Will Adams, an assistant director in the downtown L.A. office of Julien J. Studley who represented both Litton and Lewis in the sale. The 16-acre site used to house a number of Litton operations, including its engineering and defense systems manufacturing divisions as well as its credit union. Lewis Co. plans to raze the existing buildings and construct three industrial structures ranging from 110,000 square feet to 122,000 square feet each, according to Mike Clark, a broker in the Woodland Hills office of Cushman & Wakefield, which is handling leasing for the project. The three buildings represent the first phase of the project, which is slated to begin construction this month. The buildings are scheduled to be ready for occupancy in April. The second phase will involve construction of a single 90,000-square-foot building if Lewis chooses to exercise its option on the additional 4.6 acre parcel, Clark said. Demand from busy entertainment companies and general warehousing operations has driven down the vacancy rate for industrial space to about 6.5 percent in the San Fernando Valley, Clark said. And the vacancy rate is only about 2.5 percent for buildings of 100,000 square feet and above. Hollywood studios like the bigger buildings because they’re more suitable for sound stages, set-building and other activities that require high ceilings and plenty of floor space, according to Clark, while warehouse operators like them because merchandise can be stacked higher. Clark said the new buildings will have 32-foot ceilings and other features, like state-of-the-art fire sprinkler systems, that will make them among the most modern in the Valley. They’ll also have more parking to accommodate the Hollywood folks. General warehouse operations don’t usually require much parking, but the developer is including two spaces per 1,000 square feet in the project because studios typically require more workers than warehouses do, Clark explained. Clark said little new space has been built since the 1980s, partly because of the recession and partly because so little vacant land is left that developers must find sites like the former Litton property where they can demolish existing structures to clear the land. “The Valley is such a mature industrial market that the most modern buildings we have, for the most part, were built in the 1970s and 1980s,” Clark said. According to Mavin Dodge, vice president of operations for Lewis, the project is the only one Lewis now has under construction in Los Angeles County, but the company is in escrow on several other sites where it hopes to build industrial and office projects. A lesson in development In one of the most unusual recent real estate partnerships, a Santa Clarita school district has become a partner with Agoura Hills developer RussDar Corp. in an entertainment and shopping center to be built at a piece of school land on Soledad Canyon Road and Luther Drive in Santa Clarita. Rather than sell its parcel or lease it to the developers, Sulphur Springs Union School District has become a limited partner in Concept Centers L.P., which is building the 78,000-square-foot center. Construction on the project, called Solemint Junction, is slated to be finished later this year, according to Richard Darling, a principal of RussDar. Darling said his firm originally planned to lease the land from the school district and develop the center itself, which would have given the district “a modest rent for the ground lease” but no share of the center’s profits. The district and the developer decided the deal would be better for both if the school district would contribute the land as its investment in the partnership, he said. “They invested the land and we’re investing the cash,” said Darling, who said the development is one of a handful of deals in Southern California in which school districts have become partners with real estate developers. Among the others, he said, was a Doubletree Hotel at Fourth Street and the Santa Monica Freeway (Route 10) that he developed in the 1980s in partnership with the Santa Monica-Malibu Union School District. Such partnerships were popular throughout California for a while during the real estate boom of the 1980s, Darling said, “but they disappeared when the market crashed.” The Solemint Junction center will include a 10-plex movie theater, restaurants, a micro-brewery and a variety of other shops, according to Darling, who said the center is 80 percent pre-leased. Mortgage giant renews lease Fannie Mae, the Federal National Mortgage Association, has signed a 10-year, $15 million lease for 73,000 square feet of space at Plaza La Fuentes, an eight-story office building at Los Robles Avenue and Walnut Street in Pasadena, according to Jim Travers of Travers Realty Corp. Travers said Fannie Mae had one year remaining on its original 10-year lease at the site, which includes 165,000 square feet of space in the office tower and 16,000 square feet of retail space. Fannie Mae is one of the country’s largest buyers of home mortgages, which it buys from a variety of sources and resells to investors. School deal Moorpark Unified School District has bought a 61,000-square-foot industrial building on Maureen Avenue in Moorpark from the Coats Family Trust for $3.5 million, according to partner Sam Wagner of Woodland Hills-based TOLD Partners. Wagner said the school district will use the freestanding building for administration, business offices and warehousing of school district equipment. Health company consolidates Meridian Healthcare Management has leased 16,000 square feet of space on Califa Street near Variel Avenue in Warner Center for administrative offices being consolidated from three locations in Thousand Oaks, according to partner Brian Forster of TOLD Partners, who negotiated the six-year, $1.8 million lease for the company. Forster said the deal included six subleases by companies that will fill Meridian’s former space. Mall razing starts Demolition crews have begun razing the 135,000-square-foot former Robinsons-May Home Store in the Northridge Fashion Center at Tampa Avenue and Nordhoff Street as part of a previously reported plan to build a 10-screen, 2,800-seat theater complex there, according to an announcement by shopping center management. Construction of the 50,000-square-foot complex is scheduled to begin in October and be completed in the summer of 1998. Work at the mall includes an expansion at a second Robinsons-May store there which will be expanded to accommodate departments formerly housed in the Home Store.

By DANIEL TAUB Staff Reporter In early July, Universal Studios Inc. succumbed to pressure from homeowners and politicians and cut back on ambitious plans to turn its Universal City property into a massive tourist destination. For those homeowners, it seemed at the time like a total victory. The project was cut back by 44 percent, there would be no new theme parks, and the size of the resort hotels on the property would be drastically reduced. But last month, many of those living in the vicinity of the sometimes noisy, often congested Universal Studios made it clear that they’re still not happy with the expansion proposal. Leaders of local homeowners groups say they will ask city and county officials to require major new traffic improvements before approving the plan. While homeowners say Universal’s cutback was a move in the right direction, they contend that the enlarged theme park, new studios and an expansion of Universal’s complex of restaurants, stores, and movie theaters will dump too much traffic into neighboring communities. “The framework is in place for Universal to reach some kind of agreement with the community,” said Tony Lucente, president of the Studio City Residents Association. “However, the concerns that remain are substantive and require further conversation.” Lucente and others say the added traffic from the project requires a series of costly improvements including on-ramps and off-ramps linking Universal Studios to the southbound Hollywood (101) Freeway. Universal already has such connectors to the northbound Hollywood Freeway, but not to the southbound lanes. That means traffic will clog Cahuenga Boulevard, said Joan Luchs, chair of the development committee for the North Hollywood Residents Association. “We can no longer share the same space on Cahuenga Boulevard,” Luchs said. Traffic along the corridor that runs through the area and around Universal Studios the Barham-Cahuenga corridor is already heavy, and any expansion of Universal would only make it worse, agreed Krista Michaels, president of the Cahuenga Pass Property Owners Association. “I think the traffic takes a big hit in terms of our concerns because it prevents emergency vehicles from getting through,” Michaels said, noting that the hills where she lives are prone to fire. But Helen McCann, vice president of the master plan for Universal Studios, said the draft environmental impact report for the original, larger Universal expansion thoroughly addressed the traffic issues. “There is quite an extensive traffic study as part of that draft EIR,” McCann said, adding that the draft has been approved by both the city’s Department of Transportation and the county’s Department of Public Works. “It effectively mitigates all of the potential traffic impacts of both the original project and the scaled-back project.” Many business leaders, as well as some homeowners, say Universal has already conceded enough and should not be forced to make additional improvements. They see the expansion project as vital to establishing the Valley as a destination community which would help the area compete against Orange and San Diego counties for tourist dollars. Scaling back the project was “an incredibly generous gesture on Universal’s part,” said Brent Seltzer, a member of the Studio City Residents Association. He said the complaints of his neighbors are based on speculation about the expansion’s possible impact, rather than facts. “Their issues are pure perception and not based on reading through the material, talking to the people and going to the meetings,” Seltzer said. “The reach-out (by Universal) is incredible.” In early July, Universal cut the size of the project from 5.9 million square feet to 3.3 million square feet. The revised project still calls for nearly 1.2 million square feet of new office and studio office space, 450,000 square feet of new studio production space and a 388,000-square-foot expansion of the Universal Studios Hollywood theme park. Highrise hotels, however, were eliminated from the plan, and the number of hotel rooms was reduced from 3,400 to 1,200. New retail space, primarily on CityWalk, was reduced to 250,000 square feet from 358,000 square feet. The decision to scale back the project was made after Los Angeles County Supervisor Zev Yaroslavsky and Los Angeles City Councilman John Ferraro called for a 40 percent reduction in the size of the project, elimination of the new theme park, a reduced number of hotel rooms and other changes. The project is currently up for approval by the city and county planning commissions. The county’s Regional Planning Commission is scheduled to next meet on the project on Sept. 17. Pamela Holt, an assistant administrator with the county’s Department of Regional Planning, said that at the next meeting her staff will answer questions the commission had at its last hearing on the plan in early July. “There’s some concern about the uses allowed in the green area” between the studios and neighboring homes, Holt said. “And there’s always remaining concerns about noise and traffic.” Residents will also have the opportunity to air their concerns if and when the plan goes to the county Board of Supervisors for approval, when the city’s planning commission hears the plan, and if and when it goes to the L.A. City Council for approval. Just as the homeowners are waiting for more information on the revised project, so are Yaroslavsky and Ferraro’s offices. “There’s a lot of paperwork we’re expecting to get back that we haven’t seen yet,” said Joel Bellman, Yaroslavsky’s press deputy. Renee Weitzer, Ferraro’s planning deputy, said she is awaiting the county planning commission’s next hearing, and will review the scaled-back plan once that commission has made a decision.

By LARRY KANTER Staff Reporter Few would question the fact that L.A.’s show business boom has transformed the economy of the San Fernando Valley. Far less certain, however, is how the myriad television production companies in Burbank, Studio City and Sherman Oaks stack up against one another. That’s because entertainment companies tend to jealously guard their financial information. Even the production units of publicly owned entities, such as Warner Bros. and Walt Disney Co., balk at breaking out the numbers generated by their various divisions which made compiling the Business Journal’s first-ever List of television production companies a challenge. Rather than ranking the Valley’s 25 largest television production houses on the basis of revenues or number of employees, the Business Journal ranked the region’s TV producers on the number of programs currently in production. Those producing network shows were ranked highest, followed by those producing syndicated shows, followed by those producing one-time specials. The results leave no doubt that the East Valley is the center of TV production activity, with the 25 firms on the List cranking out a steady stream of shows for broadcast and cable outlets. Burbank-based Warner Bros. Television leads the tally, with 18 shows in production including such highly touted titles as “The Drew Carey Show,” “ER” and “Friends.” Following Warner Bros. on the List is NBC Television, which has 13 series in production, including “City Guys” and the award-winning “Homicide: Life on the Street.” In the No. 3 spot is Dick Clark Productions, which has 12 broadcast shows in production, including a number of award shows and a stream of “blooper” specials. Television production has become increasingly important in recent years, with four of the world’s largest entertainment companies Disney, Warner Bros., Paramount Pictures and Fox Inc. either creating or purchasing TV networks in an attempt to own both programs and a distribution channel for them. But despite the fact that many studios now own networks, independent producers are in little danger of being shut out, for this simple reason: No matter who owns the network, it has to buy the best shows to remain competitive. Networks and individual stations make most of their money on selling air time to advertisers, and ad rates are pegged to the number of viewers tuning into a particular show. So if the shows are not popular and viewers don’t tune in, the network or station can not successfully compete for advertising dollars. Some of the busiest production companies in the Valley are independents, including Studio City-based Carsey-Warner Productions, which has five shows in production, including such hit sitcoms as ABC’s “Cybill” and NBC’s “Third Rock From the Sun.” Of course, there also are plenty of firms producing more-obscure programs, most of them created for cable. No. 16 on the List, Sherman Oaks-based Weller/Grossman Productions, for example, has nine series in production, including “Curses,” Master Hoaxes,” and “Witches.” Animation also is making its mark in the Valley, with several companies including Film Roman Inc., DIC Enterprises Inc. and Ruby Spears Productions producing cartoon series for both cable and broadcast networks.

Court Throws Book at Katzenberg Hollywood’s juiciest lawsuit took another nasty turn late last month after a court-appointed referee ordered Walt Disney Co. chieftain Michael Eisner to turn over portions of his yet-unpublished autobiography to archrival Jeffrey Katzenberg. Katzenberg, who was chairman of Walt Disney Studios before quitting in 1994 after Eisner failed to give him Disney’s No. 2 job, is pursuing a $250 million breach-of-contract suit against his former employer. The DreamWorks SKG co-founder claims that his old contract with Disney guaranteed him 2 percent of the profits from any productions created or acquired during his tenure. Eisner has been working for months on his autobiography along with celebrity profile-writer Tony Schwartz. The book was listed in the fall catalog for New York publisher Random House, but its release has been postponed indefinitely because the book isn’t ready. On Aug. 25, referee Lucas Campbell (who was appointed to hear arguments during the discovery portion of the case by L.A. Superior Court Judge John Ouderkirk) ordered Eisner to give any portions of the book relevant to the suit to Katzenberg’s attorneys. Secret Deals… When it comes to what real estate companies are talking about, there’s one topic that’s always off-limits: deals for entertainment clients. “It’s like they don’t want to ruin the magic of their industry with such unpleasantness as real estate and monetary transactions,” said one architect, who spoke on the condition of anonymity. Interior design firms to real estate brokers have stories of being told by their entertainment clients that they absolutely, postively can’t mention their work. Walt Disney Co. and Warner Bros. were often mentioned as the strictest silencers, but spokespeople for both firms perhaps not surprisingly declined to comment. …And a Not-So-Secret One “THE SECRET’S OUT” the Daily News trumpeted in a Page One story last month detailing plans for new city, county, state and federal buildings in the downtown Civic Center. “The plan is a virtual secret,” the paper said of the proposed “10-Minute Diamond” plan, named for the time it takes to walk to any of the four corners of the area. A secret plan? Not quite. A number of publications have written about the proposal, including the 1 million-circulation L.A. Times, which printed a detailed story on the 10-Minute Diamond last year. If anything, lack of public awareness of the plan seems more a function of disinterest in the Civic Center than of any plot by city officials. “The secret part of it was confusing,” Rocky Delgadillo, deputy mayor for economic development, said of the story. Leg Advertising Just when you thought advertising had been placed everywhere on the sides of office buildings and hotels, on large boards on the back of trucks, and on stickers placed on grocery store produce a Newhall businessman has found a new place to advertise: His right leg. Ryan Villiers-Furze, owner of Ryebread’s Toaster, a graphic design and advertising firm in Newhall, broke his leg playing softball a few months back. He at first was put into a hip cast, but it was replaced last month by a smaller cast. “When I broke my leg, I was kind of joking with people that I would sell ad space on my cast,” he said. The joke became a reality when he started gluing the business cards of friends, colleagues and others to his new cast for a $10 fee per card. The money is being donated to the Association to Aid Victims of Domestic Violence a group for which he already has raised more than $200 with the ads and the cast was almost completely filled within a week. “It’s truly the one time an advertiser can say space is limited,” Villiers-Furze said. Gripe, gripe, gripe Newsroom denizens are known to grouse and apparently they get an early start at it. The 1994 Northridge Earthquake knocked the Journalism Department at Cal State Northridge out of its Jerome Richfield Hall and into temporary trailers. The shift was not popular with the reporters-in-training the trailers were away from the center of the campus, lacking the conveniences and amenities of a real building. Richfield Hall reopened with the fall term, and one would think the students would be happy. But, of course, these are journalism students. “For the most part it’s better,” said one student. “There’s still a lot of construction going on around here.” Fowl Punishment While much is said about the cost of incarcerating felons, no one ever seems to talk much about the cost of incarcerating fowl. Any time a cockfighting ring is broken up in Los Angeles County, the birds must be kept as evidence until the accused cockfighters are tried. Each of those birds costs $2 a day to store potentially costing hundreds of thousands if the case doesn’t go immediately to trial, not exactly chicken feed. So what do state lawmakers want to do with birds to save taxpayers money? Kill ’em. Two Antelope Valley legislators and L.A. County Sheriff Sherman Block are pushing a bill in Sacramento that would allow for destruction of the birds. Of course, as the bill dictates, the killing would be humane. Save Your Change In what must be a panhandler’s version of paradise, the Glendale Civic Auditorium is hosting a convention for aficionados of vintage slot machines, jukeboxes, pinball machines, gumball vendors and other amusement devices. The event, dubbed the Original Loose Change Fun Fair, takes place Sept. 13-14. In addition to the coin-operated stuff, antique dealers from throughout the Western United States are expected to show up with classic neon, advertising and gambling memorabilia. Everything on the floor will be up for sale. General admission is $4 per day so save up your spare change.

By JEANNETTE DESANTIS Contributing Reporter It began as a dusty horse ranch owned by movie mogul Harry Warner, but nearly 50 years later the area now known as Warner Center has become one of the most concentrated business districts in Southern California. The 1.5-square-mile stretch of sleek office towers, campus-like grounds and pedestrian trails is the corporate address of Health Net, Rocketdyne (now a division of Boeing North America), Litton Industries, 20th Century Industries and EMI Music Group. “In terms of the environment and the amenities, Warner Center is a dream come true,” said Los Angeles City Councilwoman Laura Chick. “It is one of the most advanced, state-of-the-art business communities in Southern California.” Although L.A. officials have long used such glowing terms to describe Warner Center, the district is only beginning to recover from some very hard times. In the early 1990s, it was the home of one of the most disastrous stories in L.A. real estate. The swank Plaza III office tower was built in 1991 and hit the market just as the recession did. Until late 1994, the 25-story building, which holds 585,000 square feet of space, stood completely empty. It is just now slowly being leased out, and currently has a dozen tenants taking up four floors. “That building makes up 10 percent of the vacancy rate in the West Valley,” said Bob Pearson, leasing manager for Warner Center Properties, a brokerage that handles leasing for 2.3 million square feet of office space in the center including Plaza III. Still, there is evidence of a real estate rebound. Last year, Warner Center which is bounded by Vanowen Street on the north, DeSoto Street to the east, the Ventura Freeway on the south and Topanga Canyon Boulevard to the west was the site of one of the biggest San Fernando Valley real estate deals since the recession when 12 buildings sold to CarrAmerica Realty Group for $52 million. The seller in the mostly cash deal was the Voit Cos., which developed most of Warner Center and still maintains its headquarters there. “Warner Center is the place to be for an urban environment,” said Pearson, who places the center’s overall vacancy rate at 14 percent. “People are moving from the Westside to the West Valley and want to work closer to home.” The area is also beginning to draw some much-sought-after entertainment industry tenants. In July, Ray-Art Studios converted a Warner Center warehouse into a sound stage and moved its headquarters there from Westwood. Ray-Art recently signed a five-year lease with 20th Century Fox Television, which is using the Warner Center stage to film “Nothing Sacred” for ABC and “413 Hope Street” for NBC, two shows that will debut this fall. “There is a good civilian support center here,” said studio co-owner Robert Papazian. “If people come in for the show there is the movie theater, the hotels. If the crew might want to go out to eat, there are restaurants that are just walking distance away.” In 1977, Warner Center’s first business park was built, and four years later the first highrise was built at Warner Center Plaza. To date, Warner Center contains some 15 million square feet of office space and it has room for growth. The Warner Center specific plan, approved in June 1993, envisions a total of 35.7 million square feet of commercial and industrial office space in the next 20 to 30 years. Local malls are thriving. Topanga Plaza mall, which houses Nordstrom and Robinsons-May, is currently 99 percent leased. Mall General Manager Jim Bess said Topanga Plaza expects to bring in $280 million in sales this year, 6 percent more than last year. On top of that, there is a high demand for space. “We could lease more space if we had it,” Bess said. “We would like to have another high-end department store to complement the ones we have and maybe bring in a Williams Sonoma or a Pottery Barn.” But one key ingredient to a successful business center mass transportation is still nowhere in sight. Although the Southern California Regional Rail Association owns railroad tracks along Canoga Avenue between the Chatsworth Metrolink station and Warner Center, there is little chance that transit trains might soon connect Warner Center to other parts of the city any time soon, because local and federal government officials are concentrating their attention (and funds) on the East Valley. So Warner Center commuters make do with MTA bus lines from the Conejo, Antelope and Santa Clarita valleys, one of the largest vanpool fleets in the country, and propane-powered DASH shuttles that circle more than two dozen stops in Warner Center during lunchtime. There are also plans in the next few months to create a temporary transit hub that would centralize all of the transportation services available at Warner Center. Meanwhile, business leaders are trying to come up with a new tool to market the center breaking away from the community of Woodland Hills. Brad Rosenheim, executive director of the Warner Center Business Association, is seeking to convince L.A. officials to designate Warner Center as a community unto itself. The move would have little impact other than changing mailing addresses, but would give Warner Center a greater sense of identity, Rosenheim said. “We are in competition with all the other communities for business,” Rosenheim said. “It is hard sometimes to explain to people looking to relocate their businesses here that we are really a regional center inside of the community of Woodland Hills, which is part of the city of Los Angeles.” Rosenheim has yet to convince city officials that such a move would be desirable. Chick says she is skeptical of name changes, “but I am still interested in what the community has to say. I am willing to do just about anything to help Warner Center thrive, but I just don’t understand how a name change helps that happen.” Warner Center bustles with 40,000 employees during the week and remains relatively busy on weekends. While there are no single family homes, approximately 8,000 or 9,000 residents live in condominiums and apartment complexes located its outskirts. Those numbers are boosted during the weekend by the thousands of visitors attracted to the two shopping centers, the Promenade at Woodland Hills, which houses the year-old AMC 16 Theaters and draws an estimated 1.5 million people a year, and Topanga Plaza. Another weekend attraction is the Sunday afternoon Concerts in the Park program at Warner Park, the site of free concerts for the last 22 years on every Sunday of summer. The 20-acre park, also once part of Warner family horse ranch in the ’40s and ’50s, was donated to the city of Los Angeles in 1967 by the Warner family, with the clause that it only be used for “passive, cultural pursuits.” “There is a real vitality that has always been there for Warner Center,” said Chick. “Now with the economy turning around I have great expectations that Warner Center will be full or overflowing with exciting new projects in the near future.”