MGM Moving Headquarters to Beverly Hills

The studio, which just emerged from bankruptcy, plans to vacate its namesake building in Century City in favor of office space originally intended to be occupied by WME.

Less than a week after emerging from a lengthy bankruptcy, MGM has signed a lease for new headquarters office space in Beverly Hills.

The Lion signed a lease Sunday for the entirety of the six-story, 144,000-square-foot Beverly Drive office building that was originally slated to be occupied by WME, according to a source with knowledge of the situation.

The studio will vacate its current headquarters in Century City at its namesake building -- the MGM Tower. The company leases about 200,000 square feet at the 35-story building and had been trying to sublease the offices to other parties, but that plan never came to fruition. MGM will now pay a "one-time" fee to landlord JMB Realty Corp. in order to break its lease and leave the 10250 Constellation Blvd. building, the source said.

Terms of MGM's lease with George Comfort & Sons Inc., the landlord of its new headquarters building at 235-269 N. Beverly Drive, are not known, though the Class A property is perhaps the highest-profile vacant building in Los Angeles County and would be expensive to fully lease.

It is also unclear when MGM will move into its new headquarters or whether the smaller size of the new offices is related to the company's layoffs earlier this month. About 50 employees were let go; the layoffs were part of MGM's reorganization plan.

MGM declined to comment.

The new Beverly Drive building, which was completed earlier this year, has had a brief but tumultuous history. Originally, it was to be occupied by the William Morris Agency, but the firm's 2009 merger with Endeavor threw a kink into those plans. WME backed out of an agreement to occupy the new building, and arbitration between WME and George Comfort remains unresolved, according to the source. WME has been headquartered nearby at 9601 Wilshire Blvd. since April 2009.

This fall, it was rumored that rival agency UTA had been looking into occupying the Beverly Drive building if WME did not move into it. Indeed, the source said UTA had nearly completed its negotiations to lease about 80,000 square feet of the building from George Comfort before MGM stepped in and quickly came to terms with the landlord.

WME and UTA did not immediately respond to requests for comment.

No one was speaking on the record Tuesday, but sources were surprised that MGM would sign a lease for such a high-profile building just days after exiting bankruptcy Dec. 20. The bankruptcy plan wiped out the Lion's debt and installed Spyglass Entertainment chiefs Gary Barber and Roger Birnbaum as the company's co-chief executives. MGM plans to release up to eight films a year, starting in 2012.

Speculation about MGM's move first surfaced on the Beverly Hills Courier's website on Monday.

MGM studio emerges from bankruptcy

Metro-Goldwyn-Mayer, the company behind Hollywood classics such as The Wizard of Oz and Gone with the Wind, has emerged from bankruptcy, bringing to an end a turbulent period that saw the legendary studio come close to being broken up and sold.

The company, which also owns the James Bond series, has left bankruptcy with $500m of new financing arranged by JPMorgan, and a new management team. Creditors, who were owed some $4bn by MGM, now own the studio.


Emerging from bankruptcy increases the chances of a new James Bond film being made, although it is likely the company will need to raise more funds to finance the movie.

Production of the latest Bond film to star Daniel Craig had been suspended indefinitely by the Broccoli family, which owns the rights to Bond with MGM, because of the uncertainty surrounding the studio.

Gary Barber and Roger Birnbaum, two former executives with Spyglass Entertainment, the company behind recent films including Get Him to the Greek and Dinner for Schmucks, have been appointed co-chairmen and co-chief executives of MGM.

“MGM is emerging from one of the most challenging periods of its storied history,” they said in a statement. “Beginning today, MGM is a stronger, more competitive company, with a solid financial foundation and a bright future.”

MGM’s troubles began with the highly leveraged $5bn purchase of the studio in 2004 by a consortium made up of Sony, TPG, Providence Equity Partners and Comcast.

The deal loaded the studio with debt just as the DVD market went into sharp decline. When the credit crunch took hold in 2007, the group found itself unable to raise money to finance new movies, which would have helped it sell its older library titles.

The new management team faces an uphill battle to revive MGM post-bankruptcy. Its television and film sales operations have stagnated for the past 12 months when creditors tried – and failed – to sell the studio.

Mr Birnbaum and Mr Barber are also likely to face pressure from Carl Icahn, the activist investor who holds as much as 20 per cent of MGM shares. He is keen to merge the company with Lions Gate Entertainment, the company behind the Mad Men television series.

Fox Prepares to Take a Swing at 'The Three Stooges'

With MGM in the final stretch of its Chapter 11 reorganization, The Three Stooges, one of the longest-gestating high-profile projects in Hollywood, is in the process of finding a new home at Fox.

The extraction from debt-riddled MGM is in the midst of final dealmaking, but upon completion Stooges will land at Fox with the long-involved Farrelly Brothers behind the camera. The cast that had been slapped together for the movie while it was at MGM -- Sean Penn as Larry, Jim Carrey as Curly and Benicio del Toro as Moe -- is likely to morph into a new configuration, although that too is being figured out.

A March 14 start date is being eyed.

For Peter and Bobby Farrelly, taking the project to Fox would be a homecoming, since the brothers have made most of their movies for the studio. (New Line is releasing their latest comedy, Hall Pass, next year.)

Stooges is not a biopic but a fictional treatment that maintains the Stooges’ gleeful slap schtick updated for a modern milieu. It has been a passion project for the Farrellys, who have been involved with it since C3 Entertainment Inc., the keeper of the Stooges brand, sold the feature rights to Warner Bros. in March 2001 for them to write and produce.

Early on, the project was originally set up at Columbia, which had produced the classic 1930s Stooges shorts. Eventually, Warner Bros. let the rights lapse and MGM’s Mary Parent scooped them up along with the Farrellys’ continuing participation. The movie was on the runway to go before cameras when first Penn took a self-imposed break from acting and then MGM’s financial woes whacked the whole project off track.

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