TPG Real Estate Partners bought family owned soundstages owned by Cinespace, home to TV shows including “Chicago Fire” and “Chicago Med,” the latest foray by a private-equity firm into the booming market for more production content.
TPG’s real estate arm paid $1.1 billion for more than 50 soundstages in Chicago and Toronto, Crain’s reported.
“We have been studying the content creation and production landscape as an investment theme for a few years, and in that time have developed a relationship with the family behind Cinespace,” TPG Real Estate co-head Avi Banyasz told Crain’s.
TPG’s purchase comes as private-equity firms turn their attention to studios as ever-increasing demand for streaming content turns them into safer investments. California’s Hackman Capital Partners and New York’s Square Mile Capital Management acquired Kaufman Astoria Studios in Queens.
Some institutional investors are converting warehouses to accommodate production companies. Blackstone paired up with Hudson Pacific, a West Coast real estate firm, to invest $190 million to build a 240,000-square-foot production facility in Sun Valley, California this year. Revenue from digital entertainment jumped 35 percent in the U.S. from 2019 to 2020, according to CBRE.
Cinespace will remain based in Chicago and will explore opportunities to expand beyond the two campuses at the old Ryerson Steel distribution facility. Eoin Egan, former head of production services at Netflix, will join Cinespace as chief operating officer and a co-managing partner. Keith Gee, a TPG official, will be chief financial officer and the other co-managing partner.