Santa Monica’s Week In Business

Michael Rosenthal

   The next big crisis in California revolves around the Workmen’s Compensation Insurance program. Santa Monica’s Fremont General, a public company and California’s largest private carrier, has been attempting to make a profit in this business, but, with rising claims and static rates, it’s taken some major losses. Last year, it reported a net loss of $506.3 million. As a result, it has announced plans to close 16 of its 24 claim offices while laying off 465 people. In the last 12 months, the company has reduced its employment rolls by over 1,000 people. Fortunately for Fremont, the financial services arm of the company generated net income of $102.1 million in 2000. 
   Santa Monica-based Macerich Co., owner of Santa Monica Place, has put two of its California malls up for sale with the intent of using sale proceeds to help fund a stock buy-back. The Villa Marina Marketplace in Marina del Rey and the Carmel Plaza in Northern California are the two malls slated for sale. The company is one of the largest real estate Investment Trusts in the country and, by early 2001, had repurchased 564,000 of its shares. The trust intends to buy back up to 3.4 million shares in total. 
   The Macerich Co. has named energy industry professional Jim Ackles to fill the newly created position of Vice President of energy management. It recently announced a 10 year energy management agreement with Enron Energy Services of Texas to provide Macerich with a complete facility services package that will include energy equipment operation and maintenance, fixed-price gas and electric commodity purchases and projects designed to reduce energy consumption. Ackles is certified as an Energy Purchasing Professional by the Association of Energy Engineers.
   Santa Monica’s largest advertising agency is Rubin Postaer and Associates. The firm,established in 1986, is headed by Gerald Rubin, CEO and President and Creative Director Larry Postaer. Year 2000 Gross Billings were reported to be $862.2 million. The agency, employs 380 people and count among its top clients, Honda, Acura, American Century Investments, Charles Schwab and Arco-am/pm.
   Another significant advertising agency in Santa Monica is Colby Effler and Partners. Established in 1997 the company has 63 employees and reported gross billings of $66.4 million in 2000. Rick Colby is both the Creative Director and the President. Accounts include Casa Del Mar and Shutters Hotels here in Santa Monica.
   A third, The Phelps Group, at 901 Wilshire Blvd., was established in 1981 and is headed by Joe Phelps, with Howie Cohen as the Creative Director. The company reported $58.1 million in year 2000 billings from accounts such as Western Dental, Tahiti Tourisme, Petco and IndyMac Bank.
   One of the oldest advertising agencies in Santa Monica is the Young Company headed by CEO Bart Young and L. Umstead and T. Paoli Co Creative Directors. Established in 1949, the firm reports year 2000 billings of $32 million while employing 34 people. Accounts include Candle Software, Ameritic, Agribuys.com and Aramark.
Santa Monica’s top computer reseller is Network Magic Unlimited located at 1723 21st. St. Established in 1993 and headed by President Susan Pignotti, the company reported year 2000 sales of $5.3 million while selling software and computer products from top brands such as Microsoft Windows 2000, Compaq and HP Servers, Cisco switchers and routers and Novell Software.
   One of the newest additions to Santa Monica shopping is Needlepoint on Montana. Owners Monica Taylor and Suzy Delaplane report that the ancient hobby is “Hollywood’s newest addiction” and one that does not need rehab. The shop at 625 Montana Ave has a golden retriever mascot, Heisman, to greet visitors. Among the stars reported to be avid needlepointers are Sally Field, Kate Capshaw, Julia Roberts and Uma Thurman. Apparently it is a good stress reliever, too.
   Santa Monica-based Entravision plans on extending its reach to the growing Latino market by launching two new Spanish language television stations in Santa Barbara and Tampa Fla. Entravision is the largest affiliate of Univsion Communications, the nation’ largest Spanish language broadcasting network. Though television advertising sales have weakened partially due to the dot.com implosion, the firm remains in good position while operating a radio network serving 23 markets through 47 affiliates and 57 owned and operated radio stations.
   The music business is alive and well in Santa Monica. Consider MTV and VH-1 with offices in our Sleek Precinct and the west coast homes of Universal Music Group and Sony Music Entertainment. The two international powerhouses, representing nearly 50% of the worldwide market (EMI, Warner and Bertlesman represent the other 50%) have announced a plan to sell music via the internet through monthly subscriptions. Yahoo, which went in and out of x-rated business almost simultaneously, will be the focal point for the “Duet Service.”
   In a related move Universal Music Group has agreed to buy EMusic for $23 million.