Worthe Real Estate has bought back Warner Bros. Discovery’s Burbank Studios, about a year after selling the sprawling 27-acre studio campus to the entertainment giant.
Worthe, QuadReal Property Group and Stockbridge Capital Group paid $375 million to buy the 680,000-square-foot studio and office campus back, according to property records filed with Los Angeles County. The firms announced the deal on Monday, but declined to disclose a price.
The deal came out to about $547 a square foot.
The firms won’t stop there. For starters, Worthe and its partners aim to build five new soundstages on the lot, ranging from 18,000 to 20,000 square feet each, with plans already entitled with the city. Further development will come later.
Warner Bros. will lease Burbank Studios back as the primary tenant, according to the announcement.
The deal marks one of the many transactions between Warner Bros. and Worthe over the last two decades — three of which have involved Burbank Studios at 3000 West Alameda Avenue.
In 2007, Worthe and Stockbridge bought the property from NBCUniversal — which used it as its headquarters — for about $250 million, records show.
Fast forward to 2019: Worthe and Stockbridge struck a deal to sell Burbank Studios to Warner Bros., but essentially swap them for four other Warner Bros. properties: the 30-acre Warner Bros. Ranch on Hollywood Way, as well as 4001 West Olive Avenue, 3903 West Olive Avenue and 111 North Hollywood Way. The deal closed in 2023.
The behemoth, $1 billion deal allowed Warner Bros. to keep leasing the four properties. Worthe and Stockbridge could forge ahead with building two new office buildings on 7 acres it kept as part of the deal — properties designed by Frank Gehry — and redevelop the 30-acre Warner Bros. Ranch with 16 new soundstages and a 320,000-square-foot office complex.
Now, Worthe and Stockbridge have control of the entire development, which straddles the Ventura Freeway.
Warner Bros. also provided $281 million in seller financing as part of the deal, property records show.
The rest of the development is backed by a handful of other loans.
The 800,000-square-foot office portion designed by Gehry — known as icebergs because of the buildings’ white block-like shapes — is tied to a $475 million mortgage from Wells Fargo and Morgan Stanley, which was pooled into a commercial mortgage-backed securities deal.
The Warner Bros. Ranch — now called the Ranch Lot — is backed by a $480 million loan from Apollo Global Management’s Athene Annuity and Life Company.
In December, Worthe CEO Jeff Worthe called the deal “probably the toughest construction loan we’ve ever closed, even with a 15-year lease.”