Global’s Headquarters May Be Sold to Tom Gores
He didn’t get the company, so he’s settling for the headquarters instead.
Los Angeles financier Tom Gores, who lost out on the bidding for fallen telecommunications giant Global Crossing Ltd., will soon own one of the firm’s crown jewels: the posh Beverly Hills campus where Chairman Gary Winnick ran his empire from an oval office reminiscent of the one on Pennsylvania Avenue in Washington.
Gores has a contract to buy Global Crossing’s former 2 1/2-acre campus on Santa Monica Boulevard and North Crescent Drive from Winnick for more than $50 million, knowledgeable real estate sources said. The deal would be one of the largest Beverly Hills office transactions in years, valued at more than $400 per square foot.
“That’s way, way over market value,” said Howard Sadowsky, vice chairman of real estate brokerage Julien J. Studley Inc., who negotiated separately with Global Crossing on behalf of a possible tenant. The price may make sense for Gores, however, because he intends to move his company into the property, Sadowsky noted.
“It’s one of the classic, beautiful office buildings in Southern California,” Sadowsky said. “It’s like walking into the White House. The land and the setting can’t be duplicated.”
Winnick bought the property for $41.5 million in 1998 through a partnership known as North Crescent Realty V. It housed the headquarters of Global Crossing, Asia Global Crossing and Winnick’s Pacific Capital Group and Colony Capital investment companies.
Though Global Crossing was technically headquartered in Bermuda and had substantial offices in Rochester, N.Y., the seat of power was clearly in Beverly Hills, where Winnick, co-Chairman Lodwrick Cook and Chief Executive John Legere kept offices. The new owners spent an additional $7.5 million on an elaborate restoration of the property that was closely supervised by Winnick. (Most of the company’s executive offices are now in Madison, N.J.)
The buildings are nearly vacant today after housing as many as 250 employees during Global Crossing’s peak. The property was put on the market after several unsolicited offers were made, real estate broker Martin Morganstern of Cushman & Wakefield said in September.
Neither Morganstern nor Global representative Gregg Ritchie returned phone calls requesting comment. Mark Barnhill, a spokesman for Gores’ company, Platinum Equity, said: “We do not discuss whether or not we are considering potential acquisitions.”
But other real estate sources said Gores has put down a nonrefundable $5-million payment on the transaction, which is expected to close in February. Under terms of the pending deal, Winnick would get to keep his office at the site for another year.
The property includes two buildings totaling about 124,000 square feet, a parking structure, lush gardens, reflecting pools and fountains. The complex dates to the late 1930s, when it was designed by Los Angeles “architect to the stars” Paul Revere Williams under the direction of “agent to the stars” Jules Caesar Stein.
Stein, an ophthalmologist and musician, founded the Music Corp. of America in 1924. He abandoned his medical career to book dance bands and singers at speak-easies and nightclubs on Chicago’s South Side. By the mid-1930s, MCA represented more than half of the major bands in the country. Stein then moved to Hollywood, where he signed such famous names as Bette Davis, Fred Astair and Greta Garbo.
For a headquarters suitable for his highflying image, Stein turned to Williams, a USC-trained architect who had designed mansions for automaker E.L. Cord and actor Lon Chaney.
Stein wanted a classic domestic ambience that Williams helped deliver by using white painted bricks that were actually larger than normal but appeared normal-size from a distance, thereby making the building appear smaller. He added green shutters, a portico and a decorative cupola to the two-story, neo-Georgian structure.
Details included elegant, sculpted moldings, railings, cornices and paneling. In addition to 30 offices, it included a projection room, a radio station and a hidden bar that would swing into position at the touch of a button. It sat on a plaza entered through massive iron antique gates, which Stein bought in Scotland.
Stein’s protege and successor, former theater usher and publicity man Lew Wasserman, went on to run burgeoning MCA from the famous office for decades. In 1964, MCA sold the property to Litton Industries, whose president, Tex Thornton, hired Williams to design a second, larger three-story building that complemented the original.
Gores is president, chief executive and owner of Platinum Equity, a private mergers, acquisitions and management company.
The 38-year-old lives in Beverly Hills and is listed on the Forbes list of wealthy Americans as having a net worth of $1.5 billion. He and his older brother, Alec, joined forces to bid on the assets of Global Crossing last summer before two Asian companies struck a pending deal to pull the company out of bankruptcy protection. Alec Gores’ Los Angeles company, Gores Technology Group, has often competed with Platinum Equity to buy tech businesses.
Alec Gores did beat Tom to one of Gary Winnick’s trophy properties, however. In September, Alec Gores bought Winnick’s Cape Cod-style house in Malibu with half an acre of land for close to the $9.8-million asking price.
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Times staff writer Elizabeth Douglass contributed to this report.
