Staff Reporter

The city of Los Angeles, hungry for high-paying jobs, has begun granting zoning breaks in an attempt to establish a multimedia district near Marina del Rey.

The area has several ingredients that make it ripe for multimedia use: a large supply of old warehouses that could be converted to hip offices; proximity to the thriving creative communities of Venice, Culver City and other Westside locales; nearby beaches (which multimedia types seem to crave); and the possibility that DreamWorks SKG will go through with its plan to develop a new studio campus at nearby Playa Vista.

"The city is trying to get out the word that we want multimedia and entertainment jobs here," said Jeffrey Walden, a staff member of L.A.'s Business Team in the office of Mayor Richard Riordan. "These businesses need quick turnaround time and this makes it easier for them to locate here."

The primary tool being used is allowing warehouses to retain their "light industrial" zoning designation even after they are converted to accommodate multimedia tenants. Up to now, multimedia uses required a "commercial office" designation.

That one change makes converting warehouses less expensive for landlords. The requirements for parking and traffic mitigation in "light industrial" projects are far less than the requirements for "commercial office" projects.

If not for the zoning reclassification, the warehouse conversions would jack up rents far above what multimedia tenants could afford.

Allowing the warehouses to retain their "light industrial" designation also enables landlords to avoid the costly and time-consuming permitting process that might prompt multimedia companies to look elsewhere, Walden said.

The concept for the marina-area multimedia district grew out of efforts to keep advertising agency TBWA Chiat/Day from moving its 450 employees out of the city.

The agency had outgrown its Frank Gehry-designed "Binoculars Building" in Venice, and needed to move to larger quarters. It was looking at relocation sites in several nearby cities, but decided to relocate to a 160,000-square-foot warehouse at the corner of Jefferson and Grosvenor boulevards near the Marina (90) Freeway.

The deal was made possible because the city classified TBWA Chiat/Day as a multimedia company eligible for a "light industrial" zoning designation.

Work on the warehouse conversion will begin next month and TBWA Chiat/Day is slated to move in around Labor Day, said Chief Marketing Officer Laurie Coots.

The move to create a multimedia district near Marina del Rey follows the L.A. City Council's decision last year to lower business license taxes by 80 percent for companies designated by the city clerk as "multimedia."

Previously, most multimedia companies were classified as professional firms and assessed at the maximum rate of $5.91 per $1,000 in gross receipts.

L.A.'s efforts come at a time when several nearby cities most notably Santa Monica, Culver City and Manhattan Beach are competing fiercely to attract and retain the fast-growing, non-polluting, high-paying multimedia companies.

Santa Monica, for example, already has a zone for light manufacturing and studios, while Culver City is taking inventory of its multimedia-related businesses to see what, if any, incentives are needed.

"What's happening is that a lot of multimedia companies want to locate on the west side of town," Walden said. "We have a large inventory of industrial space in the area and it turns out that these multimedia folks love to work in large open spaces with funky, cool designs."

In their pursuit of multimedia companies, L.A. and other cities are defining "multimedia" as broadly as possible so a maximum number of companies can qualify for the zoning and tax breaks.

"Of course, we're using a broad definition," said Rohit Shukla, chief executive of the Los Angeles Regional Technology Alliance, who sits on an L.A. city multimedia policy committee. "It's totally unacceptable for these guys (like TBWA Chiat/Day) to be lumped in with lawyers and accountants."

Last month, the city classified DirecTV, the satellite television division of El Segundo-based Hughes Electronics Corp., as a multimedia company.

That smoothed the way for a new broadcast facility that DirecTV plans to develop near the west end of the Marina Freeway. Building on the site is expected to start next month.

The company had been looking at sites in El Segundo, Culver City and Long Beach, said spokesman Bob Marsocci. But the L.A. tax break helped clinch the Marina-area site for the company.

Just down the street from DirecTV's site, Steven Jones Development Corp. is nearing completion on the first phase of MediaWorks, which is designed to be a three-building complex of warehouse-type space for multimedia use, according to Walden.

Walden said the city already has been contacted by 30 multimedia companies expressing interest in leasing space at the site.

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