Tax incentives create blockbuster opportunities

Georgia Production Partnership

April 2012
Tax incentives create blockbuster opportunities
from Atlanta Business Chronicle by Doug DeLoach,Contributing Writer
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Atlanta may not be the new Hollywood, but the success of tax incentive programs to lure entertainment projects here sure have made it feel that way.
Recently, Georgia was ranked third, behind California and Connecticut, in a list of “Top Ten Locations in the Universe” by the editors of P3, a Hollywood-based, internationally distributed trade publication.
The ranking was based in part on the state’s robust infrastructure, which today includes fully equipped studio spaces, such as EUE/Screen Gems, Tyler Perry Studios, Raleigh Studios Atlanta, and the recently opened Atlanta Film Studios Paulding County, as well as major technical suppliers like Panavision Atlanta. The latter facility, which opened last spring, provides film and TV production companies with the latest in 35mm, 16mm, HD 35 and 2/3-inch camera equipment.
Tyler Perry, a film and television producer and star, opened his own 200,000-square-foot studio in southwest Atlanta in fall 2008.
The facilities consist of five sound stages, a post-production facility, a back lot, a 400-seat theater and a private screening room.
These physical entities – studios, sound stages, post-production facilities, equipment purveyors – are not eligible for the state’s generous tax credit programs. They benefit indirectly from the influx of film production business, which has flowed into Georgia as a result of the incentives.
“The infrastructure is critical to ensuring long-term growth, and also represents the key to getting the marquee blockbuster movies here,” said Kris Bagwell, executive vice president of EUE/Screen Gems, the 32-acre multi-stage complex located on the former Lakewood Fairgrounds site, which began operating in 2010.
Film, television and production clients that have used the EUE/Screen Gems facility include Viacom/BET, Fox, Paramount Pictures, Sony, Hallmark, Disney/ABC Family, Turner/Cartoon Network, and Tyler Perry Studios.
EUE/Screen Gems’ 37,500-square-foot Stage 5, one of the largest sound stages in the country, has been booked since it became available in April 2011.
“Necessary Roughness,” a television series on USA Network, is currently shooting its new season there. The stage was also used in the production of feature films “Neighborhood Watch” with Ben Stiller and the Denzel Washington vehicle “Flight.”
“While an independent crew or even a small Hollywood studio might be able to shoot in a warehouse or vacant building, you wouldn’t be able to do something like ‘Iron Man 3,’ which we are doing in Wilmington [N.C., where EUE/Screen Gems also has a facility], without this scale of physical support,” Bagwell said.
While Georgia’s tax incentives are the main reason why major film and TV projects are under way in the state, industry executives also emphasized the value of resources being readily available to handle unforeseen problems and carry through productions to the final wrap.
“You have to have enough equipment and crew; you have to have enough hotel rooms and services; you have to be able to rent vehicles and walkie-talkies; and you have to have accommodations amenable to top-flight actors,” said Roger M. Bobb, president and CEO of Bobbcat Films in Atlanta.
“No matter how much money you save by coming here, if you have to bring everything with you, you’re going to quickly eat up your savings,” said Bobb who started his own production company last year after a successful career as an executive producer at Tyler Perry Studios.
At Raleigh Studios Atlanta in Senoia, President Scott Tigchelaar said his company was about to close the doors when the initial round of tax incentive legislation reignited interest in Georgia as a primary production destination.
“We were doing the odd music video and a few corporate commercial projects, but over the course of 10 years the only feature film that was made here was ‘Sweet Home Alabama,’ ” Tigchelaar said.
Today, Raleigh Studios encompasses production offices, sound stages, hair and makeup facilities, and back lot locations featuring lakes, rivers, forests and fields spread over 120 acres in Coweta County.
“Most of ‘The Walking Dead’ last season was filmed on the property,” said Tigchelaar, referring to the zombie-infested TV series, which has been a global success for the AMC cable television network. Senoia officials recently announced third-season shooting of “The Walking Dead” will begin in May.
“What we’re doing is building infrastructure to attract projects, which will take root in Georgia and churn the support businesses that surround it,” said Jeremy Hariton, a partner at RoadTown Enterprises Ltd., an entertainment production and consulting company headquartered in Sherman Oaks, Calif.
RoadTown has joined with county authorities to build Atlanta Film Studios Paulding County. The facility, which only recently opened and has yet to sign up its first client, includes two 20,000-square-foot sound stages, production offices, 30,000 square feet of mill space, and acres of parking.
Atlanta-based Rainforest Films has no production facilities of its own, but company President Rob Hardy reinforced the importance of infrastructure build-out to the sustainability of Georgia’s entertainment business sector.
“We have a small staff that spends its time developing projects, but I would never be working here if the economics didn’t make sense or the facilities were not available,” said Hardy, whose directorial credits include episodes of “Vampire Diaries,” “Single Ladies” and “The Game,” all of which were shot in Georgia.
“Georgia has been so successful with the tax credit program, and now we have a round of follow-on investment,” said Bagwell, who thinks the industry has room to expand despite a level of competitive activity that might portend a disastrous glut.
“That’s a good thing,” Bagwell said. “If there’s no competition, it means the business isn’t growing.”
Craig Miller
GPP Co-President