IBM Tells Developer It’s Bailing Out of Playa Vista
Turning up the heat on the developer of the beleaguered Playa Vista film studio, an executive with giant computer maker IBM sent formal notice Tuesday saying the company is bailing out of the project and also demanded $430,000 in unpaid fees that are “seriously past due.”
The letter, sent to developer Robert F. Maguire III by Richard K. Selvage, IBM’s general manager of media and entertainment, clearly is designed to force the hand of Maguire, who is locked in a stalemate with studio DreamWorks SKG over the development of the much-touted studio, office and residential project.
DreamWorks contends that the $8-billion project has stalled because Maguire is unwilling to cede control and equity to new investors in the project.
The IBM letter is the first formal word from a creditor saying that Maguire’s business is seriously past due on a bill. The company, Maguire Thomas Partners, earlier this year announced it was splitting up.
Maguire has denied persistent rumors that he is experiencing a financial crunch. On Friday, he continued to deny any problems, declaring in an interview that “we pay our bills.” He was not available for comment Tuesday.
In the letter, however, Selvage said he and Maguire have had “many telephone conversations” about the unpaid consulting fees. Selvage said he is dissatisfied with Maguire’s efforts to resolve the matter, adding, “I am prepared to place your account into delinquency and pursue appropriate steps for collection.”
Hired as the “technology architect” for the project, IBM was to have played a critical role in Playa Vista’s development.
Maguire argues that legal wrangling with environmental and community groups is spooking potential financiers, an argument vehemently disputed by DreamWorks and others active in Playa Vista, such as Los Angeles City Councilwoman Ruth Galanter.
Founded by director Steven Spielberg, music mogul David Geffen and studio executive Jeffrey Katzenberg, DreamWorks had planned to build a campus-like studio lot on the site near Marina del Rey. Despite strong political support, the project is in danger of collapsing because of the stalemate, forcing DreamWorks to begin looking at other sites, notably the CBS Studio Center in Studio City.
Expressing “deep frustration and disappointment,” Selvage in his letter called Playa Vista a “missed opportunity which impacts so many and the failure to establish a trusted relationship which has severely shaken my confidence in the project.”
Selvage said that under Maguire’s leadership, IBM is no longer interested in participating “in any capacity” and won’t reconsider until Maguire recommits to going ahead with the project as initially envisioned.
