Hopes are high that the funding will spark a flurry of activity, including new studios and production facilities.<\/p>\n
But some question whether it will be enough to truly spur a film-fueled cavalcade of real estate rollouts.\u00a0<\/p>\n
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\n Courtesy of Media for Texas\n <\/p>\n
\u201cIt would make sense that no one would break ground before we had this long-term incentive,\u201d said Chase Musslewhite, a founder of advocacy group Media for Texas. \u201cBecause for real estate to have a boom in the way it needs to have a boom, you have to have that financial security to mitigate risk for the next decade.\u201d\u00a0<\/p>\n
The funding is likely to draw more film and television production to Texas, spurring development to the likes of the upcoming Hill Country Studios, Musslewhite said. Hill Country’s plans to begin vertical construction on its $267M, 820K SF San Marcos project<\/a> this year were partially dependent on the bill\u2019s passing.\u00a0<\/p>\n Other studios, including Bastrop 552 outside of Austin<\/a> and Super Studios in Mansfield<\/a>, are also preparing to break ground as SB 22 moves the needle, according to Media for Texas.<\/p>\n In addition to new studio projects, producers are expected to target existing industrial space, like Hillwood<\/a>\u2019s speculative industrial buildings at AllianceTexas<\/a> in Fort Worth, North Texas Film Alliance founder and CEO Brian Whitlock said.<\/p>\n Yellowstone Director Taylor Sheridan\u2019s Bosque Ranch Productions\u00a0last week leased 450K SF<\/a>\u00a0in the development from Ross Perot Jr<\/a>.\u2019s Hillwood.<\/p>\n \u201cWe\u2019re looking at an opportunity where there is a new asset class around this,\u201d Whitlock said.\u00a0<\/p>\n But\u00a0that asset class might not grow quickly or turn immediate profits, and the new funding incentive won\u2019t be a magic wand to turn Texas into the new Hollywood<\/a>, according to some industry watchers and longtime studio owners.<\/p>\n \n Courtesy of ATX Film Studios\n <\/p>\n Advocates of the bill,\u00a0including Lt. Gov. Dan Patrick<\/a>, have touted Texas Film Commission numbers suggesting grant recipients would spend close to $5\u00a0for every $1 they receive. University of Southern California professor\u00a0Michael Thom<\/a>\u00a0called\u00a0that estimate\u00a0\u201cpreposterous.\u201d<\/a><\/p>\n Thom’s\u00a0own\u00a0research concluded<\/a>\u00a0incentives fail to stimulate enough economic activity to justify their cost and mostly produce temporary, low-paid jobs.<\/p>\n And he isn’t alone, with other critics arguing that\u00a0return-on-investment estimates are\u00a0far\u00a0overblown<\/a>, while the sector’s unpredictable, short-term leases make production studios\u00a0among the riskier sectors\u00a0to dabble in.<\/p>\n \u201cIf someone builds a studio, they\u2019ll go bankrupt,\u201d said Stephen Bieneman, principal of Austin’s ATX Film Studios, where actors Matthew McConaughey and Woody Harrelson are filming their (possibly)<\/a> upcoming show,\u00a0Brothers.<\/p>\n \u201cThe [rental] rates aren\u2019t high enough, and they\u2019re too infrequent.\u201d\u00a0<\/p>\n Bieneman didn’t build his 240K SF studio in South Austin, instead acquiring the building about three decades ago when it was a distribution warehouse for a food company with 14 years left on its lease. The company vacated earlier than expected, leaving him with a big, empty building in 2010.<\/p>\n That\u2019s around the time ABC Disney<\/a> came calling, asking about using the space for a year to film a mockumentary drama. Despite doing nothing to turn the building into a studio, more productions approached him. The money earned eventually went\u00a0toward outfitting the property into six studios and about 18K SF of office space.<\/p>\n Bieneman has had no trouble attracting productions to his studios, but he is skeptical about the\u00a0difference new TMIIIP funding will make.<\/p>\n \u201cWill somebody build something? Probably,\u201d he said. \u201cAnd will we get more shows? Probably. But are we going to become the film [capital] of the third coast? No.\u201d\u00a0<\/p>\n Low On The National Roster\u00a0\u00a0<\/p>\n Texas\u2019 program offers cash grants<\/a>\u00a0based on a percentage of a project\u2019s eligible expenditures, including wages paid to Texas residents, with a 22.5% maximum incentive rate. SB 22 will raise that to between 25% and 31%<\/a>, depending on the total cost of a production and where and how\u00a0it is filmed.\u00a0<\/p>\n \u201cThat puts us \u2018in the game,\u2019 but towards the bottom,\u201d Bieneman said.\u00a0<\/p>\n \n Courtesy of Media for Texas\n <\/p>\n \n Lt. Gov. Dan Patrick and actor Dennis Quaid at an event promoting Texas’ film industry.\n <\/p>\n New TMIIIP funding puts Texas on the same incentive tier as states\u00a0like Louisiana and Pennsylvania<\/a>. California, by contrast, is offering incentives of\u00a0up to 35% in Los Angeles and up to 40% in other parts of the state<\/a>. Georgia was spending about $900M annually<\/a>\u00a0on its program, dwarfing Texas\u2019 $150M a year.\u00a0 \u00a0<\/p>\n Texas does offer filmmakers some special advantages: a business-friendly environment, geographical diversity and relative affordability. That plus funding could help Texas capture productions fleeing California following destructive wildfires earlier this year, said John Boyd<\/a> Jr., principal of Florida-based corporate site selection specialist The Boyd Co.<\/p>\n But\u00a0its appeal could be limited by the creative control Texas wants over productions filmed in the state. Lawmakers made it clear they don\u2019t want to give incentives to media that would portray Texas in a negative light, and the bill allows the Texas Film Commission to offer special grants<\/a> for productions promoting family values.\u00a0<\/p>\n \u201cTexas won’t be the perfect location choice for every type of production, but it’ll be a great choice for many, many types of projects,\u201d including faith-based programming, which Boyd\u00a0said is one of the industry’s fastest-growing sectors<\/a>.<\/p>\n For some filmmakers, a pro-family-values stance is a plus. Actor Zachary Levi said the $100M studio he is launching in Bastrop<\/a>, near Austin, will be dedicated to \u201cmaking non woke movies with non woke actors.\u201d <\/a>\u00a0<\/p>\n The new TMIIIP funding can be used in tandem with media production development zones<\/a>, which Texas municipalities have offered since 2009. The Media Production Development Zone Act creates a tax exemption for the construction, maintenance, expansion or renovation of a media production facility at a qualified location for up to two years.<\/p>\n \n Courtesy of Media for Texas\n <\/p>\n \n Actor Billy Bob Thornton, center, with Media for Texas co-founders Grant Wood and Chase Musslewhite.\n <\/p>\n \u201cIt really opens up the opportunity for production facilities, soundstages, preproduction, postproduction, all of those to be built,\u201d said Christie Goodman Duke, director of targeted attraction and state affairs for the Arlington Economic Development Corp.<\/p>\n Creating An Infrastructure\u00a0<\/p>\n<\/p>\n<\/p>\n<\/p>\n