Marking the largest lease deal in the history of Hollywood in a decade, Kilroy Realty Corp. (KRC), the Los Angeles, CA-based Equity-Real Estate Investment Trust (‘REIT’) has embarked on a long-term lease agreement with the entertainment giant Viacom. As per the agreement, the REIT will lease around 180,000 square feet of space at its 685,000-square-foot, mixed-use Columbia Square development, located in the heart of Hollywood. This deal provides Viacom with an opportunity to relocate and unite the West Coast operations of Viacom media networks, which it has been planning for some time.
Viacom’s media operations, including BET, Comedy Central, MTV, Spike TV, VH1 and TV Land, are currently based in Santa Monica and in other Los Angeles offices. These businesses will be relocated to Columbia Square’s 250,000-square-foot, six-story, dual-core glass and steel Gower Building. The New York-based entertainment company will likely occupy the building in phases, starting in late 2016.
Viacom’s plan to concentrate its business in Hollywood indicates Los Angeles’s unsaturated appetite for business and also the growing opportunities in Hollywood.
Currently, Kilroy Realty carries a Zacks Rank #3 (Hold). Investors interested in Equity-REITs may consider better-ranked stocks like Corrections Corporation of America (CXW), First Industrial Realty Trust Inc. (FR) and Cousins Properties Incorporated (CUZ). While Corrections Corporation sports a Zacks Rank #1 (Strong Buy), the other two stocks have a Zacks Rank #2 (Buy).
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