CBS is pulling out of a large-scale development scheme on Los Angeles land occupied by the Television City complex and Farmers Market in order to concentrate on broadcasting, the network announced.
The move was part of a general retrenchment associated with top-level management changes that saw investor Laurence A. Tisch take over as president and chief executive of the corporation in September, industry sources said.
“Development takes a lot of time, energy and commitment, and he doesn’t want them diverted from what they should be doing,” one source said.
Tisch Owns More Than 25%
A brief statement issued by CBS on Monday did not give a detailed explanation.
“In accordance with the decision of CBS Inc. to concentrate on its core businesses, CBS has elected not to proceed with its real estate development at its CBS Television City facility in Los Angeles,” the statement read.
But Tisch, who now owns more than 25% of CBS stock, said in a recent interview that he does not think that the company “should be a so-called conglomerate. . . . I think this should be a media company with an emphasis on broadcasting.”
The sources said they were told that Tisch has no plans for CBS to sell its 25 acres at Beverly Boulevard and Fairfax Avenue, much of which is currently occupied by the Television City studios.
A spokesman for the A. F. Gilmore Co., a privately held firm that operates Farmers Market, south of the CBS property, said it will go ahead with a study to determine what can be built on its 30-acre parcel of land at Fairfax Avenue and 3rd Street.
‘Never Got Far Enough’
Both companies had been working together for several years to come up with plans to increase the revenue from their adjoining properties, which make up one of the largest, relatively undeveloped, parcels on the Westside.
“We never really got far enough to commit ourselves to any particular program,” said Henry L. Hilty, vice president of the Gilmore company. “We’re going to pursue taking a look at it, as we have been.”
The latest joint proposal, drawn up by Urban Investment & Development Co., a Chicago-based firm, had called for refurbishing Farmers Market, adding new shops, and building apartments overlooking Pan Pacific Park and a 300-room hotel around the century-old Gilmore adobe at the center of the property.
Norman Elkin, vice president of Urban Investment, said the early phase of development probably would have been located on the Gilmore property in any case. He said offices, more shopping and theaters on the CBS property would have been a second phase of development.
“So there’s no basic re-evaluation,” he said. “We always assumed the CBS land would be the later stages.”
Elkin and architect Barry Elbasani agreed that it would probably be easier to win approval for a smaller project. Neighborhood groups and elected officials have said they are concerned about the additional traffic that a major development would bring to the already congested area.
“At first I was upset, because I felt we were getting pretty positive responses from the community,” Elbasani said of the CBS decision. The architect has been meeting regularly with local opinion-makers to discuss the plans for the past several months.
In fact, “nothing has really changed,” he said. “I’d say that from the standpoint of uses that generate the most peak-hour traffic, they’ve been diminished, which has improved the project from the point of view of the community. The bad news is that they (CBS) pulled out. The good news is that maybe that’s not bad news.”
The CBS announcement came as a surprise to community activists, who have been involved in the planning process set up by CBS and Gilmore in an effort to win approval for the project.
‘Could Hurt Community’
Diana Plotkin, vice president of the Beverly Wilshire Homes Assn., said she is concerned that development of the Gilmore property might be followed by new construction on the CBS property at some point in the future.
“If they break it up and it’s developed fully, it could hurt the community,” she said.
But Stan Treitel, executive director of United Community and Housing Development Corp., a nonprofit group involved in revitalizing the Fairfax District, said he is heartened by the CBS decision.
“I think it will leave the community stable, the way it is,” he said. “I don’t see Gilmore going it alone.”