Producers Flee Hollywood for the Beach

Whenever New York ad agency hotshots would come to visit director Fred Petermann at his TV commercial production company in Hollywood, they always wanted to go outside for walks in the California sunshine.

Once outside, however, the East Coast clients often found themselves surrounded by dirty air, ugly buildings and people asking them for spare change. It was as if they’d never left New York.

“When you walked out the front door of our office, there was nowhere to go,” said Petermann, who has directed commercials for American Telephone & Telegraph Co. and Budweiser and is regarded as one of the best in the business. Last year, Petermann left Hollywood after 16 years and rented space in Venice. He is awaiting completion of a plush, new Santa Monica office building that he will move into in December. “I just didn’t want to be in Hollywood anymore.”

He has plenty of company. The major movie studios abandoned Hollywood years ago, and only Paramount remains. Now, many production companies that specialize in making TV commercials are doing the same thing. They are cruising to the beach towns of Santa Monica and Venice. Luring them are new luxury hotels, fine restaurants and hip art galleries. Also, many top directors have moved to the area--and a gaggle of hip ad agencies has also set shop there. Then, there’s that keen desire to at least appear to be where the action is.

“It’s a theme park for clients,” explained Gary Buonanno, executive producer at Michael/Daniel Associates, which moved from Hollywood to Studio City three years ago and is now looking to relocate in Santa Monica. The company has filmed commercials for Bud Light.

“When clients come to California, they don’t want to be trapped in town. They want to feel like they’re really in California,” said Gary Feil, executive producer at BFCS, which has filmed ads for the California Lottery, and which opened in Santa Monica two months ago.

One production company that recently moved to the beach even placed bicycles and roller skates in its office for clients to use. So popular have the beach towns become that over the past year at least six commercial production companies have moved from--or announced plans to move from--Hollywood. Besides Petermann Films, Michael/Daniel Associates and BFCS, plenty of others have their cameras focused on the Westside.

Riverrun Films, which filmed those “Getting to Know You” ads for Geo automobiles, may soon move from Hollywood to Venice. Image Point Productions, which has filmed some of those roving red dot commercials for 7-Up, plans to move from Hollywood within the next six months--probably to the Westside. And six months ago, Chelsea Pictures, which has filmed “Heartbeat of America” ads for Chevrolet, left Hollywood for Santa Monica.

Others have been there for some time, including De Sort Films, which moved there 11 years ago, Cucoloris Productions and Berkofsky/Barrett Productions. Perhaps the most sought-after director in the business, Joe Pytka, moved his commercial production company there in 1985. “I was enchanted by Venice because of its art community,” said Pytka, who has directed many of Nike’s Bo Jackson ads, as well some of the Pepsi ads that feature Michael Jackson and Madonna. “The creative atmosphere was like New York’s Soho district 15 years ago.”

But today, creativity is hardly mentioned by most.

“It’s totally an image thing,” said Steven Monkarsh, executive producer at Riverrun Films. “The commercial production companies have finally caught up with the art community.”

Some say the lure is the trend-setting Los Angeles ad agencies--such as Chiat/Day/Mojo, Suissa & Associates and the Shalek Agency--that have moved to the area. “If ad agencies moved to the Mojave Desert, it wouldn’t be long until we moved there,” said Michael Romersa, chief operating officer of Partners USA, a production company moving to Santa Monica. Partners, which has filmed ads for Giorgio perfume, also owns Michael/Daniel.

“It’s the cool place to be,” said Jonathan Miller, president of Image Point Productions. “Certainly, the advertising business is all about image and perception. If you’re perceived to be doing trendy things, it doesn’t hurt.”

Adds John Marias, executive producer at Chelsea Pictures, “This area is fun. Hollywood is an ordeal.”

All of this is frustrating officials from Hollywood. “That’s the challenge of being in Hollywood,” said Larry Morris, president of the Hollywood Chamber of Commerce. “Hollywood is a victim of its own success.”

Meanwhile, executives at some commercial production companies that plan to stay in Hollywood are bemused by the movement out of town.

“If the emperor is wearing all of his new clothes at the beach, that’s fine with me,” said Larry Morris, chief financial officer at HKM Production, which recently purchased and renovated a big building in Hollywood. “We’re really happy here. And we bought the building we’re in for a song.”

To the contrary, the real estate in Santa Monica and Venice is very pricey. Executives interviewed said their rents or mortgage payments increased anywhere from 25% to 100% once they made the move from Hollywood to the beach. Others complain that parking near the beach is always scarce. And most still truck to Hollywood to use sound stages or special vendors.

But that isn’t stopping many from making the move. Even the West Coast president of the Assn. of Independent Commercial Producers moved his commercial production company, Smillie Films, from Hollywood to Santa Monica a year and a half ago. “The reality is, most directors live in these areas,” said Bill Perna. “And they don’t want to keep commuting to Hollywood.”

Many trace the beginning of this trend back to 1979, when Jack De Sort was among the very first to move his production company, De Sort Films, from Hollywood to Santa Monica.

People told him he was crazy. After all, the business had always been in Hollywood. “I wanted to get away from Hollywood,” said De Sort, who occasionally picnics on the roof of his office building that is one block from the ocean. “I wanted to be where the air was clean.”

J. W. Thompson Chief of L.A. Office Resigns

The fast pace of change at J. Walter Thompson’s Los Angeles office continues.

In the past week, the agency picked up some badly needed new business but lost the man who has run the Los Angeles office for the past eight years.

On Monday, the agency announced that James K. Agnew, who has been with the agency for 20 years, was resigning “to pursue other career interests.” Bill Lane, executive vice president of JWT West, will assume Agnew’s duties as general manager of J. Walter Thompson/Los Angeles.

Lane returned to California in May after two years in New York as co-executive creative director at a time when the Los Angeles office was losing ad business, including the 20th Century Fox account. Agnew said he already had begun exploring the possibility of a position in one of Thompson’s international offices when Lane returned “as part of an orderly succession.”

When that failed to pan out, Agnew said he chose to resign. “I’m excited about some of the opportunities that are available with my background,” he said, “and felt it was important to be open to discuss those opportunities.”

Like other New York agencies that have opened Los Angeles offices, J. Walter Thompson has been disappointed in the results.

Slowly, however, the Los Angeles office has been getting back on its feet. As a result of several recent business wins, the agency has rehired four employees that were laid off earlier in the year, Agnew said.

Last week, the agency picked up the new Los Angeles-based cruise company Concorde Cruises. Agnew declined to reveal the size of the billings, but industry sources estimate it at about $5 million annually.

Concorde’s new, 352-passenger ship will start operations in December, 1991, with seven-day cruises from Puerto Vallarta to Acapulco and Guatemala. Mexicana Airlines, also a client of Thompson, will be the primary air carrier to Puerto Vallarta. Print advertising for the new cruise line will probably begin this winter.

Tracy-Locke Finds Life Beyond Taco Bell

Some are calling it the agency that refuses to die.

Back in April, the Los Angeles office of the Dallas ad agency Tracy-Locke lost the $80-million national ad business for its biggest client, Taco Bell, to Foote, Cone & Belding’s San Francisco office.

Massive layoffs followed. There were even rumors that the Los Angeles office would close. But management staunchly denied that, citing the fact that it hung onto the Mexican fast-food chain’s $10-million regional business. Well, earlier this month it lost that business, too.

Is the office doomed now? No way, insists Dan Michel, who joined the office as president about a year and a half ago. “We take a long view of things,” said Michel. “And we think our chances for success here are terrific.”

He may be right. Over the past six months the agency has picked up six new clients, including Aqua Chem pool chemicals and Walt Disney Records. Michel declined to reveal the combined billings of the new clients, but they are believed to exceed $15 million annually.

“Taco Bell was a blessing and a burden at the same time,” said Michel. “You can’t build an agency on a single client.”

Cycle Campaign Isn’t a Case of Typecasting

No one’s going to mistake Alan Pando for Evel Knievel.

But last week, the Moto du Monde (Motorcycles of the World) Grand Prix-style racing series awarded its estimated $2-million advertising business to his agency, the Los Angeles office of DDB Needham Worldwide. The agency will also handle public relations for the new competition and seek out corporate sponsors.

Pando, president of the agency’s Western operations, recalls he has only ridden a motorcycle once. “But I think they stopped making it after World War I,” he said.