studio management services “fire”
DESCRIPTION
Studio Management Services “Fire”. 956 Seward St. Los Angeles, California. (December 17, 2002). The “Studio Management Services” Fire December 17, 2002. Second floor of the building (Looking West). 956 Seward St., Los Angeles California. Exhibit # 052-026. Studio Management Services - PowerPoint PPT PresentationTRANSCRIPT
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956 Seward St.Los Angeles, California
956 Seward St.Los Angeles, California
Studio Management Services “Fire”
Studio Management Services “Fire”
(December 17, 2002)(December 17, 2002)
2956 Seward St., Los Angeles California956 Seward St., Los Angeles California
The “Studio Management Services” FireDecember 17, 2002
Second floor of the building (Looking West)
Exhibit # 052-026
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Studio Management ServicesDefinitions
Building 27
Seward BuildingsSet of 4 buildings acquired by Studio Management Services
@ 23,000 square feet of office spaceIn escrow prior to fireAcquired to provide additional office space for production
facilities
Business Interruption LossLost profits because of Fire from:
Office space and parkingAncillary services (e.g., electricians, film crew)Telecommunication servicesProduction Facilities (e.g. sound stages, lighting, grip, technical
equipment)
Building Destroyed By Fire on December 17, 2002@ 30,000 square feet of office space
SMS = Studio Management Services
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Studio Management Services Map
Building 27
Seward BuildingsSeward Buildings
Building 27Building 27
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Studio Management Services
Business Losses01/01/2003 – 06/30/2009
1. Pre-trial Business Interruption Losses- 01/01/2003 – 06/30/2007
2. Post-trial Business Interruption Losses- 07/01/2007 – 06/30/2009
3. Property Damage
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Studio Management Services (SMS)My Assignment – Calculate Business Interruption Losses
Calculate SMS’ business interruption losses from time of Fire to present
Calculate SMS’ future business interruption losses
Not tasked to calculate property damageProperty damage includes
Clean up water damage to Building 27 Damage to equipment
Property damage to be addressed by SMS’ controller
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Studio Management ServicesBusiness Model
SMS Offers Bundled Services to the Entertainment Industry Not in the office rental business Licenses Production facilities and related services, offices and
parking
Office Space Must be Within Walking Distance of Production Facilities
When SMS has more office space available, SMS generates more profit from production facilities and related services
Historical performance – SMS operated KTLA Studios until 2001 After 2001 needed additional offices to increase revenue from
production facilities and related servicesSeward Buildings acquired to provide additional office space for
production facilities, not to house Building 27 tenants
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Studio Management ServicesDamages Calculations of Business Interruption Losses
Based On:
SMS’ Audited Financial Statements (2000-2006) Audited by Moss Adams (11th largest CPA firm in the USA) Includes all SMS revenues and expenses
Seward Buildings – Pre Fire Budget (2002-2007) Revenues/Expenses Prepared by SMS 2 months before Fire. Based on independently verified historical dataBased on bottom of industry revenue cycle
Seward Buildings – Actual Revenues/ Expenses (2003-2006)
Building 27 Actual Revenues/ Expenses (2000-2002)
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Studio Management ServicesMethodology for Calculating Business Interruption Losses
Calculated losses to June 30, 2009 Another 5 year extension of lease for Building 27 through June 30, 2009
reasonably certain Lease dates back to 1979 SMS leased Building 27 from Benhar for approximately 20 years Three (3) prior 5 year extensions of lease with Benhar Any increases in rent passed through to tenants
SMS unable to acquire replacement property for Building 27
Building 27 has not been rebuilt by Benhar
SMS unable to optimize use of Seward Buildings to meet budget Improvements to Seward Buildings to optimize revenues could not be
completed as planned due to occupancy of Seward Buildings by displaced Building 27 tenants
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Lost Production Income on Building 27
Lost Office Rent On
Building 27
Lost Office Rent On Seward
Property
Studio Management ServicesPre-Trial Business Interruption Losses
01/01/2003 – 06/30/2007
+ +
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Lost Office Rent On Seward
Property
Studio Management ServicesPre-Trial Business Interruption Losses
01/01/2003 – 06/30/2007
+ +
Lost Production Income on Building 27
Lost Office Rent On
Building 27
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Lost Office Rent On
Building 27
Lost Office Rent On Seward
Property
Studio Management ServicesPre-Trial Business Interruption Losses
01/01/2003 – 06/30/2007
+ +
Lost Production Income on Building 27
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Lost Office Rent On
Building 27
Studio Management ServicesPre-Trial Business Interruption Losses
01/01/2003 – 06/30/2007
+ +
Lost Production Income on Building 27
Lost Office Rent On Seward
Property
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Studio Management Services
Business Losses01/01/2003 – 06/30/2009
1. Pre-trial Business Interruption Losses- 01/01/2003 – 06/30/2007
2. Post-trial Business Interruption Losses- 07/01/2007 – 06/30/2009
3. Property Damage