Business Facilities -November 2008

how large the payroll would grow and how much space would be needed to accommodate it. By one internal estimate, by 2015 the unit may require 633,000 square feet to house 3,700 employees. That made flexibility a crucial consideration. The external leasing environment posed another challenge. Although that may already seem far distant from current conditions, at the time the search started in early 2006 an already tight market saw upward pressure on rents ratchet further upward when Blackstone Group acquired Equity Office Properties. For a block of space of the magnitude FIM was seeking in the LA basin, the only viable options offering a single location with the opportunity for phased expansion were at new developments, some under way and others in the planning stage. Several of them were far afield from the area in west LA surrounding the Fox lot where most employees preferred to stay rooted. The search took Studley “all over the map because of the size of the potential transaction,” including the parking requirement, said Studley’s LA-based executive vice president, David Gordon. The broker commenced its search close to the mother ship, Fox, looking at Pico Boulevard in West Los Angeles. The prospects there mainly comprised in-fill opportunities, whether new buildings or tenant relocations. With a solution appearing difficult in this immediate area, the search was expanded to Orange County, the San Fernando Valley (both east and west) and even Northern California. Given the creative nature of the business, FIM’s ability to recruit coveted employees was a key part of the mandate – and most employees would have been perfectly happy to remain in the trendier precincts of west LA. “It was a big issue from Day 1,” said Capuciati. “MySpace wanted to stay in LA or Santa Monica, but there was an excruciating cost differential. That difference was north of $100 million.” The engineering side of the business offered one opportunity for flexibility, since there was a pool of similarly credentialed engineers in Silicon Valley and some work had even been offloaded to the Seattle suburb of Bellevue after a Microsoft layoff created a pool of well-credentialed engineers there, noted Gordon. But to disperse the company among too many locations “would lose what MySpace was all about,” he said. With the risks to the corporate culture deemed too great, that approach was quickly ruled out. Close to the Fox lot, a couple of options beckoned. Garnering great location and style points was the striking Cesar Pelli-designed Red Building Rendering of Fox Interactive’s new facility PHOTO CREDIT: STUDLEY, INC. BUSINESS FACILITIES 15

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Business Facilities -November 2008 Contents First Word Sanpshots Corporate Moves: Utah Kodak Develops a Megasite in Upstate New York Anatomy of a Deal: Studley Finds a New Space for Myspace Metro Spotlight: Johnson City, TN A Renaissance of Growth in Medical Plastics The Lone Star State Flexes Its Muscles Asia: A Portrait of Growth Sky's the Limit for High-tech in Arizona Corporate Moves: Pennsylvania Ohio Leads the Way Alabama's Tide Rolls to the Future IEDC 2008 Award Winners Advertiser Index Introducing Navigator Livexchange

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