Developments in the UK film and TV sector - Owen Spencer speaks to Property Week

Commercial Real Estate Counsel and member of the Film & TV Studios group, Owen Spencer, has spoken to Property Week about how the last 12 months have seen a change from the rapid rise in film and TV studio space, which the industry had enjoyed throughout the five years prior.

Property Week report that the last year has seen “a number of films due to be produced in the UK, including the next instalment of Star Wars, delayed, and industry giants Disney and Netflix have both reported falls in profits, potentially affecting future productions.”

This has provoked questions as to how much further studio development will take place, especially as a record £6.27bn was spent by film and TV companies last year; much of it going towards an additional 1.1m sq ft of stage space that has been developed since 2021.

Does this extra capacity, then, mean that the market is likely to cool?

Spencer, whose clients include Netflix, Warner Bros. and Sony Pictures, comments that it is more a case that the market has matured, rather than reached saturation point.

He notes that after the likes of Disney and Universal started striking long-term deals with established studios such as Pinewood and Elstree from 2019, their owners were able to create secure incomes and studio space became even more scarce as a result.

Now, with many major film and TV companies having studio deals in place, the market has changed, but Spencer adds: “Some big studios don’t have long-term commitments in the UK, so it’s not necessarily the case that there aren’t more big deals to be done, but we’ve moved into a different phase.”

One strategy employed by studios as a response to the scarcity in available studio space, was the trend of converting industrial warehouses into studios.

Spencer says yields will vary depending on location but adds that there are additional benefits to striking such deals with film companies.

“The other thing that’s attractive about doing a film-studio conversion from a landlord’s point of view is that it might be quite nice to have an international corporation on your books as opposed to a small logistics operator.”

This article was first published in Property Week on 26 April 2023 and is available to read in full here, behind their paywall.