Hollywood Studio Headed Toward Distress Sale After Default on $357 Million Loan

As a consequence of persistent debt struggles, owner Hackman Capital Partners is expected to bring Television City back to the market. The impending sale of this legendary studio — the birthplace of iconic television shows like “American Idol” and “All in the Family” — serves as the latest indicator of distress in Hollywood, where the film and TV sector has been severely affected by a sharp drop in southern California production. This slump follows a series of historical setbacks for the city’s entertainment industry, including the COVID-19 pandemic shutdown; the 2023 writers’ and directors’ strikes; and widespread studio cutbacks that slashed demand for sound stages.

The financial pressure on Hackman Capital is substantial as a lender group led by Deutsche Bank filed a notice of default last month claiming they were owed more than $357 million. Although the company is actively trying to renegotiate this debt, a source familiar with the situation noted that paying it off would be incredibly difficult given the current industry climate.

This is not the only property Hackman Capital is grappling with: The firm is already offloading the historic Radford Studio Center in Studio City. After Hackman defaulted on a $1.1-billion mortgage in January, Goldman Sachs assumed control of the site, which is currently in escrow to be sold to Netflix.

Additionally, Hackman’s Manhattan Beach Studios is also in play. Encumbered by a $240-million loan from Deutsche Bank, the lender is actively working to sell the debt on the 22-acre site. Interestingly, a new buyer could potentially foreclose on the asset and convert it to a high-demand use like advanced aerospace or defense manufacturing, reflecting a broader shift in how certain industrial space in Los Angeles is being utilized.

If Television City becomes available, the owners of the adjacent luxury outdoor shopping center, The Grove, and the Original Farmers Market are anticipated to be top contenders to acquire the property for business expansion. The two entities share fences with the studio, and both previously filed lawsuits to restrict Hackman’s planned expansion, labeling it a “massively scaled” project that would “overwhelm, disrupt and forever transform the community.” The Grove Owner, Rick Caruso, who bid on the studio in the past, could reemerge as a prospective buyer.

The property — built in 1952 following the designs of famed architect William Pereira — was originally purchased by Hackman Capital in 2019 from broadcaster CBS for a top bid of $750 million. To recoup this investment, the firm intended to continue renting out the studio while redeveloping newer, unprotected areas and acres of surface parking. Just last year, the city greenlit Hackman’s $1-billion redevelopment plan to construct 980,000 square feet of production facilities, offices, sound stages and retail space.