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Tuesday, July 23, 2024

Demand for entertainment production space expected to surge after strike


Owners of studios and other entertainment-related spaces will see a lot of demand after the weeks-long writers’ strike, which has largely halted production, is finally resolved, real estate professionals and analysts say.

They said the expected extra demand for this kind of real estate — critical to making movies and TV shows — was not just because of the strike, but because of fewer filming days in the months leading up to the strike.

The economic impact of the strike extends beyond television and programming, and has been reducing demand for owners of related spaces.According to FilmLA, a North American-based non-profit company, there are approximately 23 million square feet of studio space in North America and the UK Angel Track this data.

The strike, which began on May 2 and pits the Writers Guild of America union against more than 350 TV and film producers represented by the Motion Picture and Television Producers Alliance, has no timeline for when the strike will end. However, John Raulet, vice president of Atlanta-based realtor Raulet Property Partners, said the entertainment industry will need to catch up after the strike.

His company is said to be looking for film and television production space in Georgia, one of the largest studio states at about 3 million square feet FilmLA data.

Shows that would normally be filmed in the fall are not being produced now, and shows that were paused before the strike need to be resumed, Raulet said.

“We’ll be very busy when the decision to strike is made,” Rowlette said.

Demand for soundstages was falling before the strike in Los Angeles, which has the most square feet of studio space among the major markets Tracked by FilmLA in Canada, the U.S. and the U.K. According to FilmLA, the number of shooting days in the first quarter fell 24% year-over-year to 7,476 days.

Production is down for a number of reasons, including entertainment companies finally catching up to production interrupted by the pandemic, streamers cutting production programming while they wait for inflation to fall and interest rates to stop rising, and producers eager to wrap up production, FilmLA President Paul Audley said. (Paul Audley) said ahead of the expected strike.

Audley expects post-strike production to return to pre-pandemic levels, which is a positive for both the entertainment industry and the Los Angeles economy. So far, no developer has pulled out of work on the dozen or so speculative soundstage projects proposed around Los Angeles, he said.

When it comes to the need for production space after the strike, “it’s going to be a boomerang effect,” Audley said.

Still, studio and studio owners have been feeling the pain as production slowed in the U.S. and Canada ahead of and including the strike.

Los Angeles-based executive Hudson Pacific Properties, A major office and soundstage owner said this month that the strike had hit the company’s operating performance. Shares of the company have fallen about 17% over the past five sessions.

Josh Gaze, a Colliers broker who markets studios and other industrial properties, said the strike has effectively ended sales and leases of studio real estate in Greater Vancouver, one of North America’s largest hubs for film and television production.

Studio real estate deals in Vancouver and the rest of British Columbia began to wane last year as streamers pulled back on film and television production amid a slowing economy.

Gaze said the additional demand for space in the area “hasn’t surfaced for a while, certainly due to the writers’ strike, as well as the slowdown in streaming and the general economy. Studios are empty right now.”

Hollywood studios will spend a record $4.8 billion in Greater Vancouver in 2021, according to the Vancouver Economic Council website, as the industry bounces back after the previous year’s pandemic shutdown.

Tax incentives aimed at attracting filmmakers in British Columbia in recent years have attracted major TV productions including “Riverdale,” “Supernatural,” “The Flash” and “The Night Agent.”


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