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Rupert Murdoch holds onto Fox lot despite sale to Disney

With good reason

Los Angeles Times/TNS

The historic Fox Studios lot in Century City.
Los Angeles Times/TNS The historic Fox Studios lot in Century City.
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LOS ANGELES — In the end, the legendary Los Angeles birthplace of what became the vast Fox film empire was just too dear to part with.

The historic lot on Pico Boulevard in Century City was retained by the newly formed Fox Corp., even as Walt Disney absorbed much of 21st Century Fox’s entertainment assets in a $71.3-billion deal that put Captain America and Wolverine on the same team.

Fox has not spelled out its plans for the more-than 50-acre property where Shirley Temple once danced and sang, but there is certainly more than nostalgia for Hollywood history behind the decision.

Lachlan Murdoch, the eldest son of media mogul Rupert Murdoch, will run the company controlled by the family as its chairman and chief executive.

And it’s safe to predict that the old lot where generations of movies and television shows were filmed will remain a cash-generating pillar of the surviving Fox empire for years to come.

Although the reconfigured company will have a decidedly broadcast emphasis — its assets include Fox News, the Fox Broadcasting network and Fox Sports — it will remain in the scripted TV business, continuing to air “The Simpsons” and “Family Guy,” even though those programs now are owned by Disney.

The lot contains both administrative offices and soundstages, and holds immense value as an entertainment manufacturing center — but also as a potential real estate development site, despite having been chopped down in size decades ago to make way for the construction of Century City.

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The Fox lot was not assigned a specific value in the Disney deal. But 25-acre CBS Television City in the Fairfax district sold for $750 million in December to Los Angeles real estate developer Hackman Capital Partners. Real estate industry observers have speculated that the Fox property could be worth more than $1.5 billion.

The eye-popping values reflect the fierce demand for studios as both places to make entertainment and sought-after sites for dense real estate development.

Fox laid the foundation for major additions in 2016 when it filed a proposal with the city Planning Department to add more than one million square feet of offices, soundstages and other production and support facilities over the next 20 years.

The lot has about 1.5 million square feet of building space now.

Progress has been slow, however. A draft environmental impact report on the potential effects the development would have on neighborhoods around the studio — such as adding more car traffic — still is in the early stages, a Planning Department representative said.

The incentive to add offices and other facilities that could be rented to entertainment industry tenants is high in this period of rapid growth among free-spending new competitors in the business, such as Netflix, Amazon.com, Apple and Alphabet Inc., the parent company of Google.

Other studio owners already are cashing in on the ravenous demand for office and production space from young video-streaming content creators and old-line Hollywood companies, providing a model for Fox.

Shows that have recently filmed there include Fox’s “The Orville,” ABC’s “Modern Family” and CBS’ “Life in Pieces.”

The latter two shows are 20th Century Fox productions but air on other networks. Fox’s “The Simpsons” has been based on the lot for decades.

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In the past, other major studios have leased soundstage space, including NBCUniversal, which produced “House” for broadcast on Fox.

But today, the lot almost exclusively is occupied by producers and crews working on Fox productions.

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