Media mogul Oprah Winfrey's newly formed television network has leased space formerly occupied by Variety magazine at Wilshire Courtyard on the Miracle Mile.
The Oprah Winfrey Network LLC, a venture of Silver Spring, Md.-based media company Discovery Communications Inc. and Winfrey's Harpo Inc. Chicago production company, began moving into its 51,000-square-foot headquarters office March 1. The network, known as OWN, is expected to begin broadcasting in early 2010 on what is currently the Discovery Health Channel.
Terms of the 66-month lease at the 5700 Wilshire Blvd. property were not disclosed. However, the broker who represented OWN said it was a good deal for the tenant.
"It is a very aggressive deal they made us an offer we just couldn't refuse," said Loralie Ogden, a CB Richard Ellis Group Inc. broker.
The asking rental rate at Wilshire Courtyard, owned by RREEF, a San Francisco-based unit of Deutsche Bank's asset management arm, is in the range of $3.50-$3.75 per square foot per month.
The Wilshire Courtyard building had long been known by many as the "Variety building," but the Hollywood trade publication left its roughly 67,000 square feet of space in December for a Miracle Mile office property down the street. OWN is taking most of that vacant space.
The lease has fueled industry speculation that Winfrey will leave Chicago, where her talk show is based, to focus on OWN.
Winfrey's contract for the "The Oprah Winfrey Show" will expire in 2011 and it has been reported that she will end the program then. However, a spokeswoman said Harpo will maintain its Chicago headquarters, though Winfrey has yet to disclose her personal plans.
OWN, which was launched in January 2008, previously subleased space at Media Studios North in Burbank. That deal expired Feb. 28 and the company was unable to work out a new lease with landlord M. David Paul & Associates, forcing OWN to quickly find new space.
Brad Feld of Madison Partners, who represented RREEF, said that OWN "had nowhere to go," and signed a license agreement a type of short-term contract that allowed OWN to immediately move into Wilshire Courtyard, even though a lease hadn't been brokered.
"We figured if we could just get them into the building that would be 90 percent of the way there," said Feld, adding the lease was signed in mid-March.
OWN declined to comment on the deal.
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