Daily Updates

April 28, 2013

Big growth likely for Georgia’s film industry

ATLANTA (AP) — A few years ago, Georgia was locked in a bidding war with North Carolina over the Disney movie, “The Last Song,” starring Miley Cyrus.

Both states wanted the movie to film in their state, and North Carolina was close to sealing the deal with an attractive tax incentive package. But Georgia snapped up the production, largely because it had recently expanded its own tax credit for films.

The state hasn’t looked back since. Not only are TV shows like “The Walking Dead” and films like “The Hunger Games” sequel filmed in Georgia, but tens of millions of dollars are being invested to build up critical infrastructure. No fewer than five major studio developments or expansions have been announced in recent months with the goal of luring big-budget blockbusters.

“It really is about the whole package,” said Lee Thomas, director of the Georgia Film, Music & Digital Entertainment Office. “They can do everything here now.”

Last fiscal year, productions filmed in Georgia generated an estimated $3.1 billion in economic activity, a 29 percent increase from the year before, according to state estimates. And Thomas said that will only increase with the studio projects in the works that will add large soundstages and back lots to lure big productions, such as “Iron Man 3,” which Georgia wasn’t able to accommodate. The state didn’t have a studio that fit the requirements of the film’s production company.

Of the studio projects in the works, one being planned in Fayette County, a short drive south of Atlanta, could be a game changer. British film studio Pinewood Shepperton PLC, home to the James Bond franchise, has reportedly been in talks with a group of investors to manage and operate the facility. It would be Pinewood’s first production facility in the U.S. Recent films shot at Pinewood Studios, outside London, include the coming Angelina Jolie film, “Maleficent” and “Jack Ryan,” directed by Sir Kenneth Branagh.

The project, once finalized, would underscore how much Georgia has become a film destination and be another sign that California continues to struggle with runaway production.

A survey last year found that California lost $3 billion in wages from 2004 to 2011 because of film and TV production moving to other states and countries, according to a report in the Los Angeles Times. Half the wages went to states such as Georgia, North Carolina and Louisiana that offer tax incentives and rebates to the industry.

Representatives of Pinewood declined comment on the plan, and the head of Fayette County’s development agency would say only that discussions continue between the company and a group of Georgia-based investors on the state-of-the-art studio complex, which would sit on 288 acres and include at least five soundstages.

“It takes the state to a whole new level,” said Matt Forshee, president of the Fayette County Development Authority, who has been closely involved in the project. “When you look at the films that have filmed in Georgia, for the most part, they have been smaller budget films, in the range of $20-25 million. This allows us to open up to larger budget productions, which means more expenditures occurring within the state, which becomes a bigger return on the investment on the state level for the tax credits.”

Georgia has come a long way since the 1939 Civil War epic “Gone With The Wind,” arguably the most famous movie about the state, was filmed in California. Three decades later, the 1971 Burt Reynolds movie “Deliverance” helped put Georgia on the map as a shooting location. The state created a film commission, and Reynolds returned to the state to shoot hits such as “Smokey and the Bandit” and “The Longest Yard.”

Now, Atlanta truly has the feel of Hollywood South. In recent years, the state has been a shooting location for films such as Clint Eastwood’s “Trouble With the Curve,” the new Jackie Robinson biopic “42” with Harrison Ford, Denzel Washington’s Oscar-nominated turn as an alcoholic pilot in “Flight,” the Katherine Heigl rom-com “Life as We Know It,” the current Reese Witherspoon project “The Good Lie,” and comedies such as 2011’s “Hall Pass” and the coming “Anchorman: The Legend Continues” starring Will Ferrell.

While studio developers building soundstages are not eligible for Georgia’s tax credit program, the production companies making films are. Georgia provides a 20 percent tax credit for companies that spend $500,000 or more on production and post-production in the state, either in a single production or on multiple projects.

Georgia also grants an additional 10 percent tax credit if the finished project includes a state promotional logo. Further, if a company has little or no Georgia tax liability, it can transfer or sell its tax credits.

“The industry follows the dollar,” Forshee said. “They are going to go where they can do the best product for the cheapest cost. This tax credit has made Georgia a viable and lucrative place to make films.”

The economic benefits have been debated in Georgia, although the state has remained committed to the film incentives. Meanwhile, lawmakers in North Carolina are debating a plan that would place certain limitations on the state’s program, with supporters of the effort saying there’s no evidence the $30 million in tax breaks in 2011 matches the job growth cited by the industry. In comparison, Georgia handed out $140.6 million in tax credits in 2010.

Gov. Nathan Deal said it’s the combination of the tax credits and Georgia’s diverse landscape — from the mountains to the coast — that has made the state so attractive to filmmakers.

“It is an affirmation of several things, some of which is just the natural beauty of our state,” Deal said in a recent interview. “You are seeing ample evidence that the tax credits for the movie and film industry are definitely paying the dividends that we anticipated.”

There are a number of ripple effects. The films bring jobs, and the state already has an estimated 5,000 union and non-union professionals associated with the film industry along with more than 1,000 production suppliers and support companies. Major components of the proposed studio projects also include educational programs aimed at training the next generation of industry employees.

This week, Atlanta-based Jacoby Development announced plans to build an estimated $1 billion multiuse project north of downtown Atlanta that will include 12 soundstages as well as production offices and an arts and media school.

Jim Jacoby, chairman of The Jacoby Group, said he expected to have financing lined up quickly and was in Hollywood this week to pitch the project.

“The times are ripe because the demand is there right now. We feel like we have a facility that we can get to market quickly,” Jacoby said.

The studio project will be located on 100 acres in Gwinnett County just north of the city, where with an existing 500,000-square-foot building can be remade into 12 soundstages. Plans call for construction to begin by the end of the year.

“The facility that Jacoby is building will be designed to Hollywood standards and will fill quickly,” said Gary Bastien, whose architectural firm will be involved in the studio design. Bastien has designed various TV and movie projects for major studios in Southern California.

Other projects include a planned expansion of Tyler Perry’s sprawling studio complex that already includes five soundstages, a $100 million project east of the city in Newton County and a $90 million studio planned in Effingham County near Savannah.

The one in Newton County is in the early stages, but Covington-based Triple Horse says it plans a 160-acre studio with multiple soundstages, post-production facilities and a back lot. The one in Effingham County is backed by Medient Studios, which began in India and has expanded with offices in Hollywood and London. Medient’s project includes a $90 million studio and entertainment complex with the goal of also becoming a major tourist destination.

Thomas, who heads the state’s entertainment office, said another side benefit has been Georgia’s burgeoning film tourism industry, with fans planning vacations around visits to film locations. Much of that has centered on the town of Senoia, where AMC’s “The Walking Dead” is filmed, with plans to promote Georgia locations in connection with the coming release of the “Hunger Games” sequel. The state also has launched a website, ComeToGeorgia.com, that lists movie tours and travel tips, pitching an opportunity to “walk in the footsteps of your favorite actors and musicians.”

Said Thomas: “We have all the pieces of the puzzle here.”

 

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