Los Angeles is behind such cities as New York, Boston, and San Francisco in digital technology. However, in the niche market of video content for the web, Los Angeles may be number one. Los Angeles is flexing its content muscle to spawn startups involved in original content made for the web. This movement is as old as the dot-com boom itself. Since high-definition web video is so inexpensive to create, there is a renewed interest in producing new and innovative original programming for the web. YouTube started adding over 100 new channels with all original content creators in 2011. Netflix launched an original show on its platform in February of 2012, with plans to add more programming in 2013. Hulu.com announced it will also start creating original programming for its users. Many users of both sites have expressed their excitement and support of this creative action.
Web content companies are forming in different pockets all around Westside Los Angeles and Hollywood. Another prominent area where web content companies are clustering is around the Hayden Tract in Culver City. PMI recently leased 13,000 square feet to Mahalo.com and 15,000 square feet to Sugar Publishing Inc. Mahalo.com is a video and web company specializing in instructional content. Recently, Mahalo started producing instructional applications for the iPad. Sugar Publishing, Inc. is the parent company of the popular video site Popsugar. Maker Studios, a YouTube content company, recently leased 18,000 square feet a few blocks away from Mahalo and Sugar at 5877 Rodeo. According to this article from The Los Angeles Times, Los Angeles billionaire Patrick Soon-Shiong’s Four Wall Studios leased space at Conjuctive Point, adjacent to Mahalo and Sugar Publishing, and is allegedly building a $20 million studio in Culver City.
YouTube also recently leased 30,000 square feet for a studio in Playa Vista. One of our previous tenants, Machinima.com, occupies 30,000 square feet in Hollywood. They started with 150 square feet in one of our creative executive suites at 10951 Pico Boulevard in 2007. They are now the most watched channel on YouTube.
Due to the fact there is so much interest in creative office space on the Westside, and especially in Culver City, now is the perfect time for solutions to be developed and executed in regards to the demand for parking. Culver City must work to help supply the parking these incoming companies require. Tenants are starting to make parking a large priority before they lease office space. A broker representing one 50,000 square foot tenant recently called PMI’s offices to ask advice on how to handle their parking needs if they leased space in the Hayden Tract. Culver City expressed a desire to ameliorate the parking situation and has already made some commitments to facilitate this resource. In addition, improving the lunch time amenities for the increasing workforce would also be beneficial.
Some large content firms are rumored to be sniffing around Culver City for creative space. We can’t say at this time if any or all of these firms will be successful in the long run. PMI has had their share of tenant failures and successes in the past. We are privileged to share that some of our previous tenant successes have included Twitter, Yammer, Eventbrite, Stylespot, and Applied Semantics. Despite the challenges PMI has faced in its leasing history, we feel that leasing space to any growing technology company is worth the risk in this economy.