The streaming wars appear to be slowing down, but not the race for studio space in New York.
Soundstage square footage in New York and New Jersey has increased 14 percent since the start of last year, according to CBRE data reported by the Wall Street Journal. More is on the way, as nine studios have started or proposed construction on nearly 1 million square feet of sound stages.
The two states combine for almost 3 million square feet of sound stages and filming areas.
“New York is one of the densest markets with a huge film-industry background and very little supply,” CBRE’s Anthony Jasenski told the Journal.
Wildflower Studios earlier this year received approval from the New York Department of Buildings to begin construction on a 775,000-square-foot project in Astoria, backed by Robert De Niro. The project will house 11 sound stages and is expected to be completed late next year.
Outside of the city, the former IBM campus in East Fishkill is being transformed into a film studio. The property, which was slated to have nine stages, will have the tallest sound stages in the Hudson Valley.
To cope with the lack of supply, Jasenski told the publication that production companies are signing longer leases. Companies typically rent space for three to 12 months, but have been signing leases with studios stretching five to 10 years.
The studio trend has been boosted by a few factors, including lucrative tax incentives and streaming services’ thirst for content. New York’s film and television production tax credit, funded at $420 million a year, was recently extended through 2025.
Obstacles are beginning to emerge, however, that could threaten a golden era for New York’s studio spaces.
Some companies are recognizing how tight the market is and turning to build their own studios instead. Netflix, for instance, is planning on submitting a bid to build a production facility in central New Jersey.
Also, the first signs of weariness toward streaming services are emerging. Netflix announced last month it lost subscribers for the first time in more than a decade. CNN+ is set to shut down just a month after the landmark product’s launch.
Nevertheless, there’s seemingly an endless amount of content needed to satiate a global community of 1.3 billion streaming subscribers as of last year.
“I would not panic and think this boom is over on the facility side,” senior media analyst Michael Nathanson of MoffettNathanson told the Journal.
[WSJ] — Holden Walter-Warner