Hudson Pacific and Blackstone Secure 15-Month Extension on $1.1 Billion Hollywood Studio Loan

Hudson Pacific Properties and Blackstone have successfully secured a 15-month extension on a $1.1 billion loan, pushing its maturity to November 2027. This loan is backed by 2.2 million square feet of Hollywood studio assets, including Sunset Gower, Sunset Las Palmas, and Sunset Bronson Studios, along with adjacent office buildings. The note had been transferred to special servicing shortly before its original August 9 deadline. Under the new terms, the borrowers will fund a $20 million leasing reserve from excess cash flow, maintaining the original interest rate without a principal paydown.

Hudson Pacific holds a 51% stake in the three-studio portfolio, with Blackstone owning the remaining 49%. As of early August, the properties were 95.5% leased, with major tenants like ABC and Netflix. These facilities received approval in 2020 for a substantial expansion, adding nearly 500,000 square feet of creative office and production support space.

This extension offers Hudson Pacific vital flexibility as it addresses other operational challenges, including the closure of Quixote production facilities in Pacoima, Panorama City, and West Hollywood. The REIT acquired Quixote in 2022 for $360 million, but the venture has since experienced declining occupancy and operating losses, contributing to Hudson Pacific's reported losses of $105 million in Q2 and $53 million in Q1. For developers and lenders, this highlights the ongoing adjustments in the commercial real estate debt market, particularly for specialized assets.