Hollywood Meets Real Estate: The Future of Studio & Office with Victor Coleman, CEO of Hudson Pacific Properties

Summary

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The Kirsh Connection

Episode: Hollywood Meets Real Estate: The Future of Studio & Office with Victor Coleman, CEO of Hudson Pacific Properties
Host: Andrew Kirsh
Guest: Victor Coleman, CEO & Chairman, Hudson Pacific Properties
Date: April 7, 2026

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Episode Overview

This episode of The Kirsh Connection features an in-depth conversation between Andrew Kirsh and Victor Coleman, CEO of Hudson Pacific Properties, exploring Coleman's unique journey from Vancouver to becoming a top public company executive, Hudson Pacific’s evolution, the state and future of West Coast real estate—especially the studio and office sectors—and candid advice for those starting in the industry. The episode maintains an informal, insightful, and occasionally humorous tone, with notable diversions into sports, personal stories, and the impact of social and economic changes on real estate.

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Key Discussion Points & Insights

1. Personal Background & Roots (01:31–04:30)

• Coleman's Early Life:
  • Born and raised in Vancouver, BC; maintains family and strong emotional ties there.
  • Relocated to California for school (Berkeley) and never returned to live in Canada.
  • Discusses the impact of the Palisades fire and community efforts to rebuild.
    • “My heart is with the Palisades. I'm still working on all facets and functions to try to get back...A lot of heart there and I'm part of that pulse, I believe.” (01:46)

2. Career Journey: From Wall Street to Real Estate Mogul (04:30–08:35)

• Early Career Moves:
  • First job at Drexel Burnham after college, through Beverly Hills family connections.
  • Met mentor Dick Simon, leading to a partnership and creation of Arden Realty in 1990.
  • Arden went public in 1996, sold in 2006 at the "peak of the market."
    • “We had a great partnership for 16 years. Went public in 1996, sold in 2006.” (08:44)
• Transition to Hudson Pacific:
  • After Arden’s sale, started Hudson Pacific Properties with private equity backing.
  • Initially no intention of returning public, but market timing led to a 2010 IPO.
    • “Nobody really goes public once, but nobody really goes public twice…It was massively successful, the offering.” (15:08, 17:59)

3. Memorable Moments in Real Estate (08:35–13:23)

• Legendary Closing Dinner Story:
  • Latham & Watkins $7 million invoice after Arden’s 2006 sale, delivered in a whiskey bottle box.
  • The firm hosted a lavish closing dinner trip to Dubai for the principals.
    • “Paul brought it in a whiskey bottle case…about $7 million. If you pay this, we'll take you…anywhere you want to go.” (10:30)
    • “We met the Al Habtoor family…saw the Palm Islands being built…stayed at the Burj Al Arab.” (11:59)

4. The Evolution of Hudson Pacific Properties (13:23–20:10)

• Business Model & Asset Classes:

  • Focused on both office and studio properties, primarily in California and the West Coast.
  • Strategic market timing and willingness to be both nimble and opportunistic.

• The Pros and Cons of Taking a Company Public:

  • Recognition of extensive regulation post-Sarbanes-Oxley; public companies face much more scrutiny.
  • Big benefit: Speed to raise capital (e.g., $700M in 3 days in 2025).
    • “Having a public vehicle is so unique and so valuable at the right time...turning the faucet on.” (17:59–20:10)

5. West Coast Real Estate Market Analysis (20:10–29:13)

• San Francisco's Comeback:

  • Credits pro-business mayor and the influx of AI/tech firms.
    • “Dan Lurie’s done a phenomenal job…It’s the second best city in the country right now for real estate.” (20:48–22:45)

• Comparative Market Dynamics:

  • Seattle is “palatable” with a new mayor but lacks business acumen.
  • LA lags: Lack of return to office among city workers; leadership not proactive enough.
    • “City of LA’s not back to work full time...It’s shocking. Largest city in the country by far.” (24:04)
  • Entertainment industry’s eroded leadership and competitive disadvantage due to strikes and lack of incentives.

• Flight of Production from LA:

  • LA’s loss of its “competitive advantage” (infrastructure, back-of-house talent), production shifting to NY, Atlanta, Vancouver, and international locations.
    • “We had the competitive advantage because we had the infrastructure...but it was never to the level it is today because we didn’t embrace it.” (26:25)

• Future Outlook:

  • Groundswell of talent wanting to return to LA.
  • Prediction: “As low as we’re gonna get” for LA; Atlanta could be hit harder going forward.

6. Strategy and the Future of Hudson Pacific (29:56–32:43)

• Company Direction:

  • Shifting focus away from studio operations toward high-quality office properties.
  • Market share in studio business is high, but production volume is down, so focus is on efficiency.
    • “Doesn’t matter how much market share you have, but if there’s no market it’s irrelevant.” (30:43)
  • Most bullish on Sunset studio properties and quality office assets.

• Market-by-Market Insights:

  • Seattle set to recover, trailing SF’s recovery curve.
  • LA is a “big question mark”, especially post-2028 Olympics—historically a challenge for host cities’ finances.

7. Deep-Dive: Downtown LA & Office Market Trends (32:43–34:19)

• Downtown LA:

  • Chronic underperformance, rental rates stagnant for 30 years.
    • “LA downtown has really never performed...rental rates are still where they were 30 years ago.” (33:05)
  • Prediction: Other submarkets will outperform due to amenities, capital investment, and tenant movement.

• West Coast Micro-Markets:

  • Regret missing Bellevue, WA, which flourished due to favorable tax climate.
    • “Bellevue…probably should have gone into.” (34:27)

• Return-to-Office Trends:

  • Hybrid but trending consistently toward four to five days in office per week.
  • Space per employee increasing; flexible, “fluid” office environments.
    • “Square foot per person has gone up…It’s even increasing more.” (36:45)

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Memorable Quotes & Notable Moments

• On Going Public (again):
  “Nobody really goes public once, but nobody really goes public twice.” (15:08)

• On LA’s Political Leadership:
  “The city of LA’s not back to work full time. They’re not in their offices. It’s shocking. It’s the largest city in the country by far.” (24:04)

• On Market Share in Studios:
  “It doesn’t matter how much market share you have, but if there’s no market it’s irrelevant.” (30:43)

• Advice for Industry Newcomers:
  “If you don't know how to underwrite and have that sort of smell test that works, even as a real young person...I think that's the way to go.” (40:49)

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Timestamps for Important Segments

• Coleman’s background & post-Palisades fire reflections: 01:31–03:41
• Career launch, Arden Realty, and mentorship: 04:30–08:44
• Legendary Dubai closing dinner story: 08:35–13:23
• Hudson Pacific’s IPO and public/private trade-offs: 13:23–20:10
• San Francisco, Seattle, LA political & business climates: 20:10–29:16
• Industry flight from LA & hopes for resurgence: 26:02–29:16
• Future strategy for Hudson Pacific: 29:56–32:43
• Downtown LA vs. other markets: 32:43–34:19
• Return-to-work trends & office design evolution: 35:13–36:52
• Golf club banter & favorite courses: 37:24–39:50
• Advice for real estate newcomers: 40:49–41:56

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Notable Personal Moments

• Golf Talk & LA Golf Courses:

  • Both Coleman and Kirsh swap stories about LA golf clubs; Coleman is a member at Riviera, Bel-Air, and Hillcrest, and favors Riviera as the “best course on the West Coast." (37:28–38:19)
  • Humorous banter about golfing experiences and exclusive club rules.

• International Travel Stories:

  • Tales from Dubai and visiting the Taj Mahal—Coleman calls it “the most spectacular place I have ever seen.” (12:54–13:21)

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Closing Advice for Young Real Estate Professionals (40:49–41:56)

Coleman: “The fact that somebody’s coming and say they want to be in real estate business is a smart thing to do because when the businesses are depressed, that’s when you’re going to get in...you got to have a good personality. You got to be out there. You got to want to shake hands...that’s the way to go.”

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Takeaways

• Real estate cycles are relentless; success often comes from timing, adaptability, and building strong relationships.
• Urban markets are governed as much by politics and public leadership as by macroeconomics, with “pro business” policies creating significant city-level divergence.
• LA’s entertainment infrastructure, once unassailable, is at risk without concerted leadership and investment.
• For newcomers: Learn to network, underwrite, and read deals—skills AI can’t easily replicate.

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Transcript

[A]

Hi, I'm Andrew Kirsch, co founder of Sklar Kirsch. On this podcast, I interview industry leaders. You'll hear their real time opinions on today's market, their background, unique career highlights and guidance for newcomers to the industry. This is the Kirsch Connection.

[B]

Welcome to another edition of the Kirsch Connection. I have my son as the cameraman and we are on one of the most iconic holes of all of golf. The 16th at the TPC Scottsdale Stadium course. Normally there would be 50,000 people watching me hit, but as you can see, it's just desert today as we're playing it in April. On this week's episode, I have Victor Coleman, the CEO of Hudson Pacific. Besides talking about real estate and what it's like to be a CEO of a public company, we talk about his favorite golf courses. Maybe this is one of them. Let's see how I can do. I'm playing from the tips on the 16th hole where about 173 yards.

[A]

Let's see what I can do.

[B]

It looks good. On the green. 16th hole. Victor Coleman. Enjoy the episode. And here's my buddy. There's Maverick. Having a great time. See you everybody.

[A]

Welcome to another edition of the Kirsch Connection. I'm here with Victor Coleman, CEO and chairman of Hudson Pacific Properties. Victor, thanks so much for coming into the studio.

[C]

Hey, it's my pleasure. I'm happy to be here. I love it here.

[A]

Well, I know that I would see you in the Palisades we were talking about before we were recording in front of Alfred's. And so I guess my first question is, how are things post fire?

[C]

Well, listen, true blue, my heart is with the Palisades. I'm still working on all facets and functions to try to get back in the Palisades. We're not in the Palisades and I can tell you I woefully miss it. Raise my kids there. Felt part of the community. Still am part of the community. And you know, as you know, every day you run into somebody who has some story on a positive side and then two more people on the negative side. So we're trying to motivate the populace around there and try to get that community back up and running. But it's going to take some time and it's going to take a lot of effort. But there's a lot of heart there and I'm part of that pulse, I believe.

[A]

Yeah, I talk a lot about it in my podcast. I'm sure my audience may be sick and tired of hearing it. But 5,000 homes, 5,000 different stories. And I was telling you of one of. We were thinking of going all over the country. We ended up just a couple miles away in Santa Monica, still playing some baseball with the ppba, trying to get them back in the Palisades with Village School. My kids went there, and obviously Village school burnt down. And it's gonna be a long road.

[C]

And, you know, the generations. I mean, you have kids, I have kids. You know, they were raised there, they started their lives there. They're always gonna be part of the Palisade. So hopefully that transition is going to continue and we're going to see a bigger and better prospect of environment that people are going to want to live in. I hope my kids want to move back there, that's for sure. When they have their own families.

[A]

No, absolutely. It's going to be great. It's going to. Just going to take time. And I have kids that are 11 and 9 years old, and every year is so precious. Every day is so precious. And so to have them live through a redevelopment project was probably unfair for them. And so Santa Monica is our home. And it's, you know, just a couple stone throws away from. From the Palisades and anything we can do to. To help rebuild it, that's, you know, that. That. That's what we look forward to doing.

[C]

Absolutely. Well, good for you. You're close.

[B]

Yeah.

[A]

So obviously we're going to talk about your company, but I think a lot of people probably want to know where you grew up and the life before you being CEO of Hudson.

[C]

Sure. So I am a dual citizen. I was born and raised in Vancouver, British Columbia. Grew up there. Family still have family there. I have two brothers there. My mom lives on an island still. She's still alive. She lives on an island in the Gulf Islands. So I was a Canadian boy growing up, playing all sports and living in a neighborhood that was unlike anything else that my kids got to enjoy here in Los Angeles. And I went to school in the States, I went to Berkeley, and after I got my mba, I moved to Los Angeles. I never went back. And that's basically the history of my transition through California.

[A]

All right, so you just did 25 years and 25 seconds. All right, so gold medal game, US versus Canada. What were you rooting for?

[C]

I was rooting for the Canadian team because my roots are there. I'm a huge hockey guy. I an investor in an NHL team. And so I've been part and parcel of my blood and heritage is hockey. I played Growing up, I played when I moved to Los Angeles. But obviously my roots through Canada have led me to be cheering them on. But it was, first of all, it was a great game. The series is great. The Four nations last year was great. The coach is a good friend of mine, the Canadian team. And I think it was really good for the Americans. I mean, everybody in America watched that game at 5am in the West Coast, 8am on the east coast that Sunday morning, which is just fantastic for the sport.

[A]

All my Canadian friends said three on three, overtime. Hockey is not hockey.

[C]

It's not hockey.

[A]

It's like deciding the World Series by, I don't know, a home run derby.

[C]

Yeah, 100%. And I think the only my, my, my guess is, or my speculation is the reason they did that was because it's the last event in the Olympics. They had to get the closing ceremony started. This could have gone on for hours and hours if, if it went that way. But it's not hockey. Women don't have it that way.

[A]

So interesting.

[C]

The men shouldn't either.

[A]

Yeah, I mean, at a minimum, or at most at least, you need to have four on four for some period of time.

[C]

They should have had at least a period of five on five. Of five on five before they had some form of a three on three. Right.

[A]

Like the World cup finals, I think was that.

[C]

And listen, the Stanley cup playoffs, they don't go three on three. So they go full, full overtime.

[A]

Full five on five if it goes until two in the morning. And that's what makes it exciting.

[C]

Exactly.

[A]

So you went to Cal. I feel like, I think I ran into you at Baltaire. Larry Jacobson, was he in your class?

[C]

Yes, he actually was my fraternity. Larry's a long lost friend. We went to college together. Missed him for a number of years. Came back and we were super close. What a great guy. It's a small world connection of people who are. First of all, Cal has a tremendous amount of roots. It's incredible how many people I run into, not just here in la, but all around the country that went to Cal. So it's got a good lineage of people.

[A]

Well, he was sitting in that same exact chair a few weeks ago and talked about how he was in the music business and what do you say? Manager of Alanis Morissette and many other.

[C]

And now he's in the real estate business.

[A]

And now he's in the real estate business.

[C]

Yeah.

[A]

So there you go.

[C]

And very good at it, for sure.

[A]

So, all right, you graduate Cal, what was next?

[C]

So I ended up coming down here, and my college roommate, who's still my best friend today, he and I moved down here together, and he was from. From la Beverly Hills. Family introduced me through family connections, and I ended up getting a job at Drexel Burnham. That was my first job out of college, and I worked for Drexel for almost three years, and at which point I had met an investor of Michael Bilken's through that whole connection, who ended up being my mentor, my partner, and we started a real estate company together called Arden Realty.

[A]

Okay, I assume that mentor was Dick Simon.

[C]

Yes. It was great. Yeah. And.

[A]

And so what? So did he start Arden at the same time when. When he met you, or.

[C]

No, he. I went to work for him initially at a company called Pacific Financial Group, which was his first company, and then he had a. A brokerage arm at that company called AR LA Realty. And so I was working for LA Realty and then Pacific Financial Group. And then he decided at the time he had partners that he wanted to get out of the current portfolio that he owned. And so I helped him sell assets, and we finished liquidating the whole portfolio. And I remember he turned to me and he goes, what are you going to do? And I'm like, well, I'm like 28 years old or 27 years old. What am I going to do? I'm going to, you know, work and start a business or figure out where I'm going to go. He said, let's be partners. And effectively, that's what it was.

[A]

And what year is this?

[C]

That was in 1990.

[A]

1990.

[C]

Yeah. We started. We started Arden effectively in 1990.

[A]

See, Dick, like other attorneys, they're smart. They got out of law and entered in the real estate business. So I'm still waiting for me to see that. That light.

[C]

He, He. He had a sixth sense for real estate. And we had a great partnership for 16 years. I mean, we went public in 1996, and we sold in 2006.

[A]

So I started my career at Latham and Watkins.

[C]

Yep.

[A]

And I know that Arden was a big client of Latham's. And Dick, when we had lunch a few years ago and he heard that I was at Latham, he told me the. The closing invoice story about Latham's invoice of the sale in 2006, where at the time, I don't know. I think they presented him like a 6 or $7 million invoice, and he was blown away. And the story that he told me,

[C]

okay, I want to see if it's the same story. Yeah.

[A]

Okay, here's here. Here's what I heard is that he said, all right, I will pay every single cent of this invoice on one condition.

[C]

Yeah.

[A]

You take maybe him and his wife. I don't know if you went on this trip, but no first class trip to Dubai.

[C]

Yeah. Didn't. It wasn't that. But the answer is that's what the end result was. What happened was the long and the short of it was our lead lawyer was a guy named Paul to seti. And Paul was a great social ringleader. He was always by your side. He was supportive. He came to every one of our board meetings. He came to every one of our shareholder meetings. He was always the guy who, you know, put the glue together for all of Latham. And the lead tax lawyer, there was a guy named Mike Brody who was at the time, he was the smartest tax guy in the country. So when they presented us the bill, they actually came, and it was Dick and I who were there, and they actually brought the bill. Paul brought it in a whiskey bottle case. It was wrapped around the whiskey bottle in the case, and it was about $7 million.

[A]

In 2006.

[C]

In 2006. And he then said, if you pay this, we'll take it for closing dinner. We'll take you guys wherever you want to go. And so Dick then said, let's go to Dubai. So it ended up being Paul decetti and Mike Brody from Latham and another Latham lawyer as well, Mike VK From Eastill, Jay Borzy from Eastill, Dick and myself. And we all went to Dubai as a boondoggle closing dinner, which I think we were there. I think I was only there for like, five days because I don't like to go anywhere real long. And they were there for like, eight. So.

[A]

So what he did tell me, though, is you guys had to stop in New York and maybe pick up the bankers and that his flight from LA to New York was business class and not first class. And he got on the phone and he said, I will not be traveling to Dubai unless every single aspect of this trip is first class.

[C]

I don't recall the business class trip, but I can tell you it was. It was Emirates that we flew, and it was first class. Yeah, I do know that because we all had huge sleepers in the time. They were brand new airlines.

[A]

What a story. I. I actually was in Dubai in December. I had a wedding in India. And so we. We made Dubai sort of our stopover and spent a couple days there. It's a Good thing we went in December and not now.

[C]

Yeah.

[A]

I could only imagine what Dubai was like 20 years ago.

[C]

Oh, it was, it was. I mean we had it. We actually had an amazing trip when we met the Al Habtoor family who was the largest contractor and construction family in all of Dubai. And we went to all the new developments. They were just building, building the Palm Islands. We took a helic trip and watch them, the actual sand being blown onto the islands. We ended up staying at the, the Burj Al Arab, which at the time was the only six star hotel in the world. It was fantastic. And so, yeah, the whole experience was great, but it, it was sort of on the incline and then today it's like massively built.

[A]

Yeah. Have you been there recently?

[C]

Been there one time, yeah. After that.

[A]

Yeah.

[C]

It's fantastic.

[A]

Well, hopefully, you know, it, the city gets preserved and not doesn't get hit too hard.

[C]

Yeah.

[A]

Based on what's, what's going on today. We were also in Doha in Qatar and both were fascinating places. On our way to India, which I don't know. Have you been to India?

[C]

I've never been, no.

[A]

You have to go once. You don't necessarily need to go back, but you have to go once. And the Taj Mahal is the most spectacular place I have ever seen.

[C]

Wow.

[A]

It is. I'm not an overly spiritual person, but there is some sort of spiritual enlightenment that you get by just interesting being in front of the Taj Mahal and it's quite. The whole country is quite an experience.

[C]

That's great.

[A]

So in Arden, I know the focus was office and it seemed like you guys just timed the market perfectly.

[C]

Yeah, you know, listen, we sold in six peak of the market. You know, I tell people all the time, you know, we didn't have this vision that the world was going to, you know, the great financial crisis was going to occur and you know, interest rates are going to shift and nobody was going to want to invest and things like that. Listen, we got lucky. There was a series of things that happened internally in the company that we made decisions and said this is the right time. We had Lehman Brothers as our bankers. They had their sort of ear to the ground, their pulses to the marketplace and we spent a tremendous amount of time working with them, deciding what's the best avenue for us to exit. And we ended up actually marketing the company and effectively it got bought by ge, but it was really GE and Blackstone all part of it and they split it all up and it ended up being a great deal for those Guys, at the end of the day, they then went on to buy other stuff that was not so good. And so they had stopped just with us. Our portfolio, I think would have done a lot better, but they split off the A's and the B's, and unfortunately they kept the B's. They should have kept the A's.

[A]

And so what did you do after 06?

[C]

I had a super long tail with them. It was six months, which three months was full time. Three months was part time. I had to stay there. I stayed at. Our building was 11601 Wilshire, which is. Which is our corporate offices for Arden. I took office space on 16 and I started Hudson three months into my. My garden leave, which was in my part time. So I spent the first three months on the fourth floor and the next three months part time on the 16th floor and I started my company.

[A]

And what was the thesis then?

[C]

I mean, you know, it was never contemplated in my mind to go back in the public markets. It was really more contemplated around finding equity partners, which I did. And my first equity partner was feral on capital. We went out and we bought a few assets and we bought our first studio. And I was like, this is a good time. People weren't buying. We were capitalizing on the market timing. We had no obligations to turn around and build an enterprise and we had no expectations to do so. And what happened was we sort of amassed a portfolio over a few years and we were doing really well. And of course our bank group started coming around the corner and Latham and they said, you guys should go public. And I said, I don't know if I want to go public again. And most guys don't. You know, nobody really goes public once, but nobody really goes public twice. And so I was like, it's not going to be so easy. And they said, no, there's an opportunity for you to do so and you can spin it around an office, west coast portfolio and studios, which nobody has ever done. And so we spent a lot of time going back and forth. And in 2010, there was one opportunity in the market. We had sort of set everything up with a. And if the opportunity was right, we'd say, hey, we'll go public. And it was just a small window. And I remember I was in Chicago at a conference and we were meeting with our bankers, we were meeting with our investment bankers, we were meeting with our lawyers. And everybody's like, well, I think you should wait because the market is sort of a little choppy. And I said, if I wait now how much time I'm going to have to wait? And they go, we don't know. So I was with Farallon and my partner there was Rocky Freed and he's one of my closest friends. And I said, hey, I just think we should do this and if we don't get out, we don't get out, but let's try it. And it was massively successful, the offering. And we got out in 10 days. We went public 10 day roadshow and literally the market fell out after that and we're the only guys who ended up going public at the time.

[A]

Did Latham take you on a unbelievable closing dinner?

[C]

They did not.

[A]

Exotic.

[C]

They did not. But they're still my bankers. I'm my lawyer. Sorry, it's Julian Kleindorfer's a lead. Julian's, you know, one of the smartest guys there is and he's been a great guiding light for us. And I'm assuming that someday, if we end up selling Hudson, we'll do a big trip.

[A]

And I know Kate Tidwell is your general counsel who was a summer associate when I was in charge of the summer program in, I don't know, the mid-2000s.

[C]

So she worked on the IPO. And we go to the closing dinner and she came up to me and she said, you looking to hire? And I said, you're hired.

[B]

That was it.

[C]

And she went to Julian, said, I'm leaving you and I'm going to come

[A]

work for him at that closing dinner.

[C]

Exactly. So.

[A]

Well, you know, at least she went to a client, so.

[C]

Exactly.

[A]

That's fantastic. And so did you ever think when you started the company, what, in 2007, that three years later you would go public again?

[C]

No, I had, I literally had. I mean, listen, there's pros and cons of being public, right? And in today's day and age, there's a lot more cons than there are pros. And you're also, I mean, real estate as you know, goes through massive cycles and we're really, you know, going through a challenging cycle right now that's been longer than anybody sort of imagined. But if you're private, people really don't know what happens if you're public. I mean, you're in that fishbowl 24 7. And it was difficult at the time to make the decision to say, is this the direction we're going to go in? Are we just going to, you know, hold assets and build a portfolio and then sell when you need to sell and be a lot more under the radar? But the execution was so enticing at the time. We're like, okay, this is a great opportunity for us to figure this out. And as I said, I think in retrospect, I don't regret going public at all, actually. But I do think that there are times the times have changed in the public markets. My opinion is having a public vehicle is so unique and so valuable at the right time. So when my peers decide to go raise equity, as an example, it could take, you know, eight to 12 months to go raise a fund. And they're on the road and they're looking at deals at the same time, they're trying to raise, raise a fund if the equity markets are available in the public markets. And we just did this last summer. I mean, we raised $700 million in three days. And so that's on a book that was almost 3 billion. And so, so when you have that opportunity, it's like, you know, turning the faucet on. You can turn it on and money comes out and you turn it off and then you go, you know, run your business. But, but there are a lot more. Remember, I, I, I grew up in a marketplace at Arden where, you know, Sarbanes Oxy wasn't even in place. Right. And then many parameters came in place, and then they got enhanced with people doing, you know, illicit things that put more pressure and more reporting and, and more scrutiny on being public. And so, you know, we always ask the question as a public company, you know, is this something, was this disclosable? Was this not disclosable? Is this something that we needed to, you know, run by the lawyers? This is a constant communication and that incurs capital time and lack of efficiency over, over a period of time.

[A]

And so let's get a little granular on, on the type of assets you guys own, office and studio space. And I know it's throughout California, throughout the west coast right now. I was recently in San Francisco and I was blown away at the turnaround of that city in the last two years, you know.

[C]

Yeah.

[A]

Led by, obviously, what's going on in AI, led by the mayor. Mayor Lurie, do you think the turnaround that we are seeing in San Francisco can happen in Southern California and specifically, I guess, downtown LA and parts of Hollywood?

[C]

Well, let me say this. So first of all, Dan Lurie's done a phenomenal job. Two and a half years ago, I was at NAREID in San Francisco, and I can tell you I was having meetings. And we have a substantial portfolio in the city, but even a bigger portfolio in the Peninsula, really from all the way down to North San Jose and Palo Alto. And we're the largest landlord actually in that marketplace. And I can tell you, people I met with would say we're not going outside for dinner because this is a couple of years ago, two and a half years ago or so, because San Francisco was so scary at the time. And the, the, and the conference was actually just at sort of, sort of just south of Market, but it was also up by Van Ness, by sort of a, like close to the Tenderloin. So it was more of a sketchier area than, than the financial district was or really south of Market was or, or down by, down by the water. So I mean, people were literally saying like, you're crazy owning real estate here. One thing we see in San Francisco is aside from the dynamic aspect of Dan, and Dan, by the way, he'll go to everything. He's been to three or four of our open houses, he'll show up at an event, he supports business and he comes from a mentality of a private enterprise. And so it's different. So I'm going to get to your LA question in a second. But what happened in San Francisco is not unique to cities like San Francisco, which are boom bus cities. San Francisco's always gone up and down what it had to offer in this current cycle. Yes, AI was there, yes, technology was there, but the labor force was a young, aggressive labor force coming out of COVID that was in the marketplace ready to work. And the combination of that and the pro business of what Dan Lurie did and is doing currently right now helped just, I mean, it's the second best city in the country right now when it comes to real estate performance. And we're seeing massive growth.

[A]

What do you consider the first New York?

[C]

Okay, but I mean, we'll see what happens with AI in New York. But right now New York is still eclipsed everybody else. It came out of COVID much healthier than people even imagine. And the financial district is. All aspects are really, really on, on a lot of. A very strong trajectory there. That being said. So you go, you go to. And then I'm, you know, we're in Vancouver, Seattle, San Francisco, the Peninsula in Los Angeles. Seattle has the same dynamics in terms of the infrastructure, in terms of the tenant mix, in terms of the companies that are there and the employee base. It doesn't have the political environment. Right. They just elected a new mayor. She came from a nonprofit of one. She has no business background. So far it's been palatable we'll see where that leads over the next 24 months because she's there for four years. That also though was a shift here in LA. I spend a lot of time with the city. I spend a lot of time in the last few years with Karen's people. And with Karen, the pro business model there is not that it's not in place. You just don't have anybody with their pulse on it that says you got to get back to work. I mean the city of Los Angeles is not back to work full time. They're not in their offices. It's shocking. It's the largest city in the country by far.

[A]

And what's their. When you ask them and what's their.

[C]

They're like, well, we can't get people back. Unions aren't pushing it, we're not pushing it. And like, so how do you, how do you run a city and expect people to perform in a city when you're not there? You know, the same way your constituencies are. I think LA's got a long way to go. And I remember I made a speech in 2019 and I said how great Los Angeles is as a city. And on the, and it was, it was with Garcetti, he was there and I was talking about the future of LA in the next 10 years. So I was saying things like, we got super bowl coming, we're going to, we're going to have, we're going to have the World cup, we're going to have the Olympics, we're going to have all this stuff. Well, now we're here, right? I mean this is FIFA this year, next year's the super bowl the year after we have the Olympics. And you still have an infrastructure that's very weak from a, from a standpoint of where the city should be. But you've got a genesis of people that want to make it work. But there is, the key to it is it's got to be the business community has to rally around it. And in the. And because we're going to go there. In the old days you had leadership in entertainment and today that leadership is self driven to the companies that they represent. And what I mean by that, you used to have guys like Lou Wasserman, you used to have Marvin Davis and they would say go to work and you know, protect Hollywood, protect our brand, you know, invest in the city. And people would listen to those people, right? Michael Eisner would do that. People like that would, they would be there, Katzenberg, they would do that. Forming around businesses. And today you know, listen, Ted Sarandos is a great guy. I know Ted well, and he's done a phenomenal job. But he's not incentivized to work in Los Angeles because Los Angeles is incentivizing him. And same with Iger. He's not incentivized to do that. And our core constituents is really entertainment. And you know what's happened? I mean, we've lost because we fell asleep at the wheel.

[A]

When you talk to production heads, they indicate that it is cheaper for them to produce outside of California, sometimes outside of the United States, despite, you know, flying all of their people to that remote location. As someone who owns studios, how do we flip that switch?

[C]

Well, what's happened is this. We had the competitive advantage because we had the infrastructure.

[A]

Sure.

[C]

Right. Yes. Everybody had the talent. Talent would go anywhere if they get paid enough. Right. That's what happens. That's people in front of the camera or the directors or the producers, the showrunners. It's the back of house is what we had. Right. We had all the production, post and pre production. Everything was here. Then it started to permeate. It went, obviously, New York is populated. And it went to Atlanta, went a little bit to Albuquerque, it went to New Orleans, it went to Chicago, obviously Vancouver, Toronto. But it was never to the level it is today because we didn't embrace it. Yes, there was two strikes here that were horrible. And yes, I think people on both sides took their eye off the ball. If you go back and you said, if you didn't strike where you be, it would be a much different world, I believe. But that being said, you have the people who struck, who now are. A lot of them are out of work. They're gone because the businesses never came back. And you had the ones that were impaired by it, which is the decision makers are like, look, you walked away from us, so we went somewhere else. We're doing business somewhere else. We went to London and we went to Spain and we went to Portugal, and we went to all these places around the world in Korea because they were embracing us. And so now how do you get those people back? And it starts with the same thing. It starts with leadership. It starts with the political side of leadership, but it also starts with the production side of leadership. And you're starting to hear rumblings in the business of talent saying, I won't work outside of Los Angeles. I want to support the community. And part of that's because of what happened with the fires. Part of that's because of what happened with small businesses, and part of that is just the passion to be here. Plus, you got to uproot your family. So there is a groundswell. Is it going to materially change? In the short term, probably not. But in the long term, I do think cities like Atlanta are going to get hurt much greater than Los Angeles. I think we're as low as we're going to get, basically.

[A]

Were you surprised that Rick Caruso ultimately decided not to run for either mayor or governor?

[C]

No, I wasn't. After hearing the real reasons, which I don't want to get into. Yeah, No, I wasn't. I think Rick would have been fantastic at either.

[A]

Sure.

[C]

He's super talented. He's very passionate. I do think he's not going to be quiet from the cheap seats, so I think he's going to make a lot of impact along. Along the way.

[A]

Not. Those seats aren't so cheap, though.

[C]

No, they're not. I meant from the second row versus the front row.

[A]

I know.

[B]

I do think, by the way, he's

[A]

basically been in the front row without.

[C]

Yes. And he's supporting. As. As. As are we. He's supporting a candidate that we. We think is a very viable candidate for governor.

[A]

Yep. The mayor of San Jose.

[C]

Yeah. Again, very much the same, you know, modus operandi as. As. As San Francisco mayor. So I. And he's been great for us. And so we'll see. I don't know. He's. He's got some sharp elbows in the middle, and we'll see how he navigates his way through it. But he'll be a candidate in the future, too.

[A]

But what about locally? I feel like.

[C]

Well, I mean, let's have anybody. Well, I mean, ironically, Karen now is the moderate.

[A]

That is irony.

[C]

And so her. She's now got a sort of, you know, her base has shifted because part of her base is going on, you know, much further left with Nithya, and we'll see what happens. I think there's. Listen, I could be way off base, but I think there's no chance that she doesn't win now. So I just think that Nithya is too far away from trying to raise the awareness and the money. Ironically, her husband's a producer, and she. So she's probably, you know, the entertainment business because she has to defend her husband.

[A]

Well, there you go.

[C]

There you go.

[A]

That's a help. So sitting where you're sitting now, seeing the dynamic of la, Southern California, the West coast, where, what do you want to see out of your company? What's what's the business plan over the next several years?

[C]

So we've been hurt over, you know, a fairly amount of time just with, just with the day to day running of our business in, in leasing. And we're now seeing the trajectory of leasing going in the right direction. So we have some pretty lofty but realistic expectations of where leasing is going to go in the next 12 months. And we're excited about that. Our shift in the business is really shifting away from the studio business. I mean we were, when we went public we were 50, 50. Today we're 87, 13 in terms of 87, 87% office 13, studio.

[A]

Got it.

[C]

And listen, we're, we're firm believers in the studio business. We've made some acquisitions that we, I don't think we're the right acquisitions for sure. So, but we're, but our, our core competence is our Sunset business. We also have the Coyote business which is our OPCO and the studio side. I just think that we need to focus on high quality product which we own. We're fully leased in our high quality product which is our Sunset portfolio, which is in Los Angeles and in New York. And so that stuff is going to perform for us because of the quality of the real estate that we own in the facilities. The operating businesses are getting hurt dramatically because of the downsizing of production. And I think, and we're not just in la, we're all around the country, but we've just been impacted. We've got, it's, it's like the old adage, it doesn't matter how much market share you have, but if there's no market it's irrelevant. So we have 70% market share on our business, but it doesn't really matter. We're only utilized by 25%. So we're focusing our energy on that business around being really nimble, really efficient in our day to day you know, utilization of expanding dollars in the right places. But our core Competency is our 87% of the office building business. And we think Seattle's about to make a turn. It's always sort of 12 to 24 months behind San Francisco or the Bay Area. The Peninsula is doing great right now. It's followed on from San Francisco and the, the next market is Los Angeles, you know, but it is behind. But I do think LA is going to be interesting to be around and invest in and be cognizant because you've got a lot of capital coming here. Regardless of who runs the city. There's a lot of capital coming because it's not going to stop. What happens after 28 is the biggest question mark. And you know, historically cities that host Olympics end up filing bankruptcy shortly thereafter. So. True.

[A]

Although we don't have to really build anything correct for the Olympics.

[C]

But we do need to raise money. There's a lot of money to be, to be raised still in order for us just to perform. And the federal government's going to help out a lot, but we have to raise some money.

[A]

In terms of downtown LA and that office market. What's your perspective? I've got clients who, you know, a couple years ago were buying at a basis play that they feel, you know, they're just, if they could just maintain occupancy.

[C]

Yeah.

[A]

That cap rates will, you know, compress and, and that they'll do well on a 5 to 10 year hold.

[C]

So listen, I've been in this market, as I said, since like 1990, so I've been in this market a long time, L.A. downtown has really never performed and rental rates are still where they were, you know, 30 years ago.

[A]

Yeah.

[C]

So I don't see how that changes. Yes, some super smart people thought that they made basis plays down there. They've lost. We've all lost. We've all made bad decisions and we've lost. I just think the attraction around some of the other submarkets are going to populate quicker with tenancy because of the amenity based, because what landlords are doing to attract tenants. That you don't have that capital dedicated to downtown Los Angeles, is that to say it's over forever? I can't make that call. But I just, I'm not going to invest there and I don't believe in the, in the product line that's down there. But it's still the nucleus of Los Angeles. So we'll have to see how it plays out.

[A]

I mean, is it still the nucleus? I don't even know. Maybe we have a lot of nucleus throughout.

[C]

LA is a diversified city. I mean, it really is. There's no core la. Yes, there's downtown la, but there's no core la. I mean, you've got Beverly Hills and you've got Westwood and you've got Century City, you've got Santa Monica, you got Brentwood, you know, you got Culver City. All through the valley from Woodland Hills, Sherman Oaks, Encino. So Burbank, Glendale, Pasadena. I mean, so all these markets do well on their own, but only the quality real estate is going to stand out.

[A]

Are there micro markets or submarkets up and down the west coast where you're underrepresented, that over the next couple years you want to have more representation.

[C]

You know, the only marketplace that I would look at it that I would say that we really missed out on and didn't invest in the way I think we should have and that our peers did was we missed the Bellevue Marketplace. We chose to be in Pioneer Square, we chose to be in South Lake Union, Denny, Denny and Seattle. And those were really good markets to be in. And we sort of followed Amazon, we followed some of the tech around there and where Google is now, Apple is and the likes of that. But Bellevue really was like, it's sort of, it went against the grain. Like when Seattle came out with taxes and the likes of that or a head. Head tax and things like that, Bellevue said, hey, come to us. And so we looked real hard and every time we looked, we just passed on it. And that was probably a marketplace that's definitely a marketplace we probably should have gone into.

[A]

And the leases that you guys are doing now, what is their, I guess, return to work requirements hybrid or is it four days, is it five days? What are you seeing in terms of how employers are dealing with in office requirements for their employees?

[C]

So let me say this, okay, I'm in the real estate business, right? And I'm in the commercial real estate business. So In June of 2020, we were back to work four days a week. Now we're back to work four and a half days a week shortly there, I think September thereafter. So, you know, you kind of have to lead by example. I think the majority of tenants we are dealing with right now are in the office four to five days a week. That doesn't mean they lease less space. And that was always my argument during COVID It's their leasing space or leasing space. The space has changed. It changed during COVID It's changed post Covid. It became, you know, a lot of. I don't. There's zero chance we're co. Working together. We're not going to cohabitate to now. We're. We're finding more opportunities around workspace that's more fluid, that's opportunistic. I mean, like your space here, people work in different areas. You're seeing that. And what we have seen recently, which supports this four to five days a week and for the most part is, is. Is going to continue to be five days a week in full time is the square foot per person has gone up. It went all the way down to like 50 or 60ft. Per person.

[A]

And now it's like a micro unit apartment.

[C]

Exactly. And now. And now it's gone up like another like 30 or 40% to that on basis. And it's going. It's even increasing more.

[A]

And what about parking?

[C]

I mean, other than la, our markets don't park. It doesn't matter. I mean, San Francisco, they don't have parking. Seattle doesn't have parking. Vancouver doesn't have parking. The Peninsula, it's all surface parking anyway, so it's wide open. But yeah, you know, then people were saying, hey, we're going to count parking passes or ingress and egress passes and stuff like that for elevators and stuff. But you're seeing the flow of people. Our buildings are full, which is nice with people.

[A]

That's great.

[C]

And so except for the buildings that are vacant.

[A]

Minor detail.

[C]

Yes.

[A]

All right. In our remaining moments. Yeah, I know you're a golfer.

[C]

Yes.

[A]

You're at that other club that's east of the 405. I'm at the club west of the 405.

[C]

Yeah, I'm at a couple of them.

[A]

Oh, you are?

[C]

Yeah.

[A]

Okay.

[C]

So I'm also at the one west. I'm at Riviera, Bel Air and Hillcrest.

[A]

So you miss Brentwood?

[C]

Yeah. All right.

[A]

I was at Bel Air yesterday, not to play golf, but to have lunch. And fantastic job on the model.

[C]

They did a great job. It's beautiful. Yeah.

[A]

What's your favorite course of those?

[C]

Or anywhere?

[A]

How about first we'll go in.

[C]

La Riviera is the best course by far. I mean, I think Riviera people get mad at me for saying, I think it's the best course on the West Coast. I think it's better than Cyprus and better than Pebble Beach. I just think it's. I talked to a lot of pro golfers. They just, they love that golf course. And I do too proud to be a member there.

[A]

And how. What's the best course you've played?

[C]

That's a tough question. I mean, there's so many. It's not, it's not the quality of the course. It's just, first of all, it's the round you have. Sure, right. Fair enough. If you go out and if you go out and, you know, have like seven double bogeys, you're not going to say it's a good course.

[A]

Unless if you played at Augusta, it's still.

[C]

Yeah, I mean, I played Augusta. It's spectacular. I played at Seminole in Florida, which I really think is a great golf course. It's Always like one of my top fun, favorite courses. But I. I guess, you know, I would guess it's a hard question for me to answer. I don't know. I would say the best course I've ever played is probably Cyprus.

[A]

Yeah. Yeah, I also have played Cyprus and it's spectacular.

[C]

Just the whole ambiance and environment around that. Yeah.

[A]

They wouldn't let us use their driving range. They.

[C]

Was it closed or.

[A]

No, we were, we were guests. Was four of us, all guests. But we got before 9am we had to. We had to.

[C]

It's a great, it's a great thing

[A]

to have there, actually tee off early and if any of their members were just approaching getting close to us, a whole hole and a half, pull off to the side, scoot away and let them get through.

[C]

Yeah, they're on A company rule is really great.

[A]

Yeah, it was, it was fantastic. Little, I guess, brag. Here on Friday, I am playing. I don't know if you know Bill shop off. He's a client of mine down in Orange county and he's a member in the Bay Area of a course of a club called the Institute. It is this unknown.

[C]

I've never heard of it.

[A]

Secret country club about 30 minutes south of San Jose. Maybe 40 or 50 members. A lot of tech guys. Steph Curry, his locker number is 30 and Bill is a member and they have their opening season member guest on Friday and I will be accompanying him.

[C]

I'm super curious to hear how it is.

[A]

I played it once before with him. It is the longest course from tips to green. It's over 8,000 yards and we're not going to be playing that. It's a spectacular track.

[C]

Well, when you get back, we'll play golf.

[A]

Let's do that. Okay, final question. Yes, I get this. I'm sure you get this question a lot. I get questions like this. On the legal side, you know, recent grad comes to you and says, victor, I want to be in the real estate business. What aspect of the business should I be in? Brokerage, landlord side, tenant rep, property management, anything. What should I be doing?

[C]

Well, first of all, the fact that somebody's coming and say they want to be in real estate business is a smart thing to do because when the businesses are depressed, that's when you're going to get in. You don't want to follow the, you know, data centers and, you know, AI tech world because you never know what's going to happen there because it's all that and then it's everything else right now. So if you're getting in the real estate business business, you know, it depends on who that person is. From a personality standpoint, I'm a much more of a. You got to have a good personality. You got to be out there. You got to want to shake hands. You got to want to look people in the eye. You want to. Want to go to a lot of meetings and just get. Get educated to just soak it all in. So that's obviously on any type of transactional side, whether it's leasing, whether it's acquisitions, dispositions, whatever aspect of that business from that foundation. You can go anywhere. Real estate, if you don't know how to underwrite and sort of have that sort of smell test that works. Even as a real young person, you sort of see a deal, you see an opportunity, you're with the right kind of people. I think that's the way to go.

[A]

That's fantastic. Something that AI cannot teach you and

[C]

will not teach you.

[A]

I've been telling teachers and headmasters at schools, please, more public speaking, more presentations. That is something that our kids have to master.

[C]

Yep, absolutely.

[A]

Victor, I truly appreciate the time. I appreciate you coming south of Wilshire to the Sawtel District.

[C]

This is fun. Thank you.

[A]

It's great to have you. I appreciate it. And that's another episode of the Kirsch Connection.

[B]

I hope you enjoyed my podcast with Victor Coleman.

[A]

Fantastic guy. Fantastic golfer.

[B]

You saw my shot on the 16th hole. We're now on the 17th hole, where PGA Tour players usually drive this hole on the green and often eagle it. Let's see what I can do. Let's go. All right, so to recap, on the 16th hole, beautiful shot. I overshot the green and then three putted for bogey on the 17th hole, I teed it, I drove it on the green, three putt par. Now I'm at the tips at the iconic 18th hole at TPC Scottsdale Stadium Course. Look how far I have to drive it, Maverick. Can you get that for my viewers?

[A]

All right, here we go.

[D]

Definitely.

[B]

Let's go, Maverick. I'm going right. Hideki Matsuyama, Scotty Shepler, winners of this tournament. Here we go. Let's go. That's smoked. Get up there on the green, Putting for eagle. 18th hole, Stadium Course, Scottsdale. Maverick, let me introduce you. Here we go. This is Maverick Kirsch of the Kirsch family of the Cursed Connection.

[A]

Say hi to all of our fans.

[D]

Hi.

[B]

How'd you like TPC Scottsdale?

[D]

I liked it.

[B]

Just liked it.

[D]

I loved it. It was pretty good.

[A]

Will you say that's another episode of the Cursed Connection?

[B]

No. No.

[D]

Maybe. But I want to be on the podcast, and guess what? My dad won't let me.