Polygram inks biggest office lease deal in the history of Beverly Hills.

In what is believed to be the biggest single office lease deal in Beverly Hills history, PolyGram Filmed Entertainment will expand and consolidate much of its local operations into a new West Coast headquarters facility - the long-vacant Wilshire Crescent building.

The $30 million-plus transaction is the latest sign of the entertainment industry's dominance on L.A.'s Westside, a trend that's helped reduce vacancy rates and raise rents in the area's office buildings.

Entertainment mogul Kirk Kerkorian developed the 108,452-square-foot, four-story Wilshire Crescent building at 9333 Wilshire Blvd. in the late 1980s to house the headquarters of the MGM/UA studio, which he controlled at the time.

But Kerkorian sold MGM, and his Tracinda Corp. holding company later relocated to Las Vegas and never fully occupied - or entirely completed - the building.

A year ago, Kerkorian finally sold the building, which is clad in white marble imported from Carrerra, Italy.

PolyGram has just signed a 10-year lease (with three five-year extension options) with the building's current owner, according to PolyGram's local real estate representative, Neil Resnick, of CB Commercial Real Estate Group.

Beginning early next year, the film division of Netherlands-based entertainment giant PolyGram NV will occupy the entire building, relocating various operations from locations including the nearby 9100 Wilshire complex and the Ice House building at 9348 Civic Center Drive, both in Beverly Hills.

The new West Coast headquarters facility features a 114-seat screening room and three-story-high rotunda.

Under the direction of President Michael Kuhn and Executive Vice President Malcolm Ritchie, PolyGram's film division has grown steadily since making its initial foray into the United States in 1992. The company's box office successes include "Four Weddings and a Funeral," "Dead Man Walking" and, most recently, "Sleepers."

CB's Resnick has helped PolyGram expand, negotiating no fewer than eight local lease transactions since 1992.

The new home is just a few blocks from where another big European-based entertainment firm recently relocated its local operations. Several divisions of Bertelsmann Music Group moved to Beverly Hills from Hollywood last year, initially leasing some 75,500 square feet at the 8750 Wilshire building.

The identity of PolyGram's new landlord also illustrates a major trend in Westside commercial real estate - the abundance of institutional capital buying up the market's better office properties.

Wilshire Crescent's owner, formally known as 9333 W.B. Ltd. Inc., is affiliated with a big institutional investment fund managed by a J.P. Morgan & Co. Inc. subsidiary.

The Morgan group is thought to have paid around $20 million for a building that reportedly cost upwards of $40 million to build. CB's Stan Gerlach is the landlord's leasing agent, and West L.A.-based real estate firm Tooley & Co. also consulted the Morgan fund on the Polygram lease transaction.

In terms of square footage, real estate experts say it's the biggest lease deal ever in Beverly Hills.

J.P. Morgan's institutional clients also bought Santa Monica's big Water Garden complex last year. And a Morgan-managed fund is now finalizing what's expected to be the nation's biggest real estate transaction this year - the purchase of the Westside's signature office complex, the Century Plaza Towers in the heart of Century City.