Television production is making its way back to Los Angeles, and with that, many producers are looking for soundstage space. However, there appears to be a shortage of commercial leases for this type of space, as cable channels and streaming companies are shooting throughout the year to meet the demand of viewers. In fact, at some studios, occupancy levels have reached brand-new highs.
Based on industry insiders, this real estate space crunch stems from many factors. First, many producers are claiming Los Angeles as their home again to take full advantage of the state’s expanded tax incentives. Second, these producers are facing strong competition from Amazon, Netflix and Buzzfeed. These companies have signed long-term leases and are producing more original shows.
Another factor in the shortage of real estate is that new construction is lacking for studios. This is occurring because the land value in Los Angeles is continuing to skyrocket, so developers are not viewing soundstages, which span acres, as a good investment. New studio lots simply are not keeping up with the increase in demand.
In light of the high demand for soundstage space, now may be a beneficial time for producers to quickly pursue available commercial leases while they can still find them, and before the cost of renting goes up even more over time. However, the negotiation process can be challenging, especially in today’s competitive real estate environment in Los Angeles. An attorney can help with the negotiation process so that a business owner’s needs and interests are considered in a lease before the lease is signed.
Source: latimes.com, “TV production is soaring in L.A. But that means more competition for soundstages“, David Ng, June 6, 2017