WME’s $30M Parking Lot

A lease dispute between William Morris Endeavor and the owner of its once-future office building in Beverly Hills, Calif., has been quietly settled for about $30 million – and the result, in part, of a spat over a shared 750-space parking garage.

When Ari Emanuel’s Endeavor merged with William Morris Agency, a 20-year lease on the building was part of the bargain – an office the new regime apparently didn’t want and refused to occupy, according to the Wall Street Journal.

And at least part of the feud was over the parking garage – shared with rival Gersh Agency in a breach of the lease agreement, according to WME’s legal eagles.

Gersh had moved in to the building next door, much to WME’s apparent chagrin, and agency brass considered the shared parking quarters too close for comfort.

While $30 million is a steep price to pay to avoid prying eyes – and wagging tongues – in a parking lot, WME can take some consolation in the fact its new digs are reportedly far less expensive than the old. And the settlement does not have to be paid at once, the WSJ was told by those said to be in the know.

“The matter has been resolved on a mutually satisfactory basis,” spokesmen for WME and New York-based George Comfort & Sons, the managing member of the building’s ownership group, both said in statements quoted by the WSJ.

The office lease was but one of the deals made by ousted William Morris chief Jim Wiatt and undone by Emanuel and Co. after the merger closed.

WME partners were reportedly less than thrilled with the building’s cost, design and especially its proximity to its rival and new neighbor, sources told the WSJ. And Endeavor came with its own space for the merged company to occupy, giving WME far more space than it needed.

But there was still the problem of the lengthy lease agreement. WME argued George Comfort & Sons, the landlord, broke the deal by leasing space in an adjacent building to Gersh. An exclusivity clause, lawyers argued, stipulated that no competitor could share space – including the underground valet parking garage.

The dispute went to arbitration last summer and it was ruled the shared valet garage didn’t constitute a breach by Comfort, prompting the settlement and ending a five-year battle that was an object of curiousity and some amusement in Hollywood.

For Comfort’s part, the settlement is a win-win. On top of the $30 million the company will receive from WME, it was learned by the WSJ that part of the disputed building was leased during the legal proceedings to Metro Goldwyn Mayer.