TPG Real Estate Partners has acquired the studio campuses of Cinespace Studios in Chicago and Toronto — combined the second largest independent sound stage platform in North America — as the buying, selling and building of sound stages continues at a fast clip. It’s the firm’s second major deal in the space in as many months after agreeing in late September to acquire a large stake in Germany’s Studio Babelsberg.
Financial terms of the latest transaction were not disclosed but sources close to the deal pegged it at around $1.1 billion.
Eoin Egan, former head of production services at Netflix, will join Cinespace as COO.
Founded by the Mirkopoulos family in Toronto together with the Pissios family in Chicago, Cinespace specializes in the development, management, and operation of studio space and support facilities for the film, television, and digital media production industry. The company launched in Toronto in 1988 and today operates 23 production stages across the city, with another 12 stages planned for development on 40 acres.
Cinespace Chicago opened in 2010 and currently operates 33 stages, with an additional 15 stages undergoing development or conversion on more than 60 acres. Illinois has a 30% tax credit that runs through 2026. Dick Wolf’s Chicago Fire, Chicago PD and Chicago Med have all filmed there so did Empire and the last season of Fargo with Chris Rock.
Cinespace Toronto is a Netflix production hub for shows like the Umbrella Academy. It is also the home of The Handmaid’s Tale and upcoming film Nightmare Alley.
“Consumer appetite for original content is a growing secular trend that has accelerated through the pandemic, leading to a dramatic increase in the demand to produce new films and television and in turn, a surge in the need for studio space,” said Avi Banyasz, Partner and Co-Head of TPG Real Estate.”
“We have been studying the content creation and production landscape as an investment theme for a few years, and in that time have developed a relationship with the family behind Cinespace. We are thrilled to have the opportunity to expand on their vision by building a best-in-class studio platform that serves the creator community and drives job growth in Toronto, Chicago, and beyond,” added Jacob Muller, Managing Director at TREP.
The two execs said the real estate group will continue to explore buying or building sound stages in North America and Europe.
The space is booming along with streamer-driven production. Real estate developer Hackman Capital owns maybe the biggest collection of studios after a series of recent deals. Blackstone and Hudson Pacific Properties have been active and Bain Capital is investing in a new LA construction.
In New York, Robert Halmi, Jr.’s Great Point Capital is working on a studio complex in Yonkers with Lionsgate as anchor tenant. Steiner Studios is building an outpost. Netflix is looking at a large site in New Jersey. There’s activity in the production hub of Georgia to Oklahoma, Louisiana and other states.
Egan and Keith Gee will join Cinespace as co-Managing Partners. Gee — formerly CEO of Strive and CFO and President of LifeStorage, two former TREP portfolio companies — will be CFO.
Illinois Governor JB Pritzker said the state “is proud to welcome TPG’s investment in Cinespace and Illinois’ booming film industry. Expanding the state’s capacity for television and media production will create opportunities for countless Illinoisans — including the job training and apprenticeship programs that have been hallmarks of Cinespace’s efforts.”
Chicago Mayor Lori Lightfoot is “thrilled to see this acquisition expand our capability for content creation and look forward to the jobs and productions it will bring to our region.”
North of the border, the Honourable Doug Ford, Premier of Ontario, said: “Since launching in 1988, Cinespace has been a pillar of Toronto’s world class entertainment industry. They have been the source of incredible Canadian content and a steady job creator for the City and Province. We welcome this acquisition by TPG and look forward to their continued investment in Cinespace and commitment to growing their operations in Toronto.”
Toronto Mayor John Tory thanked the Mirkopoulos family “for founding and building up Cinespace here in our city. They were among the real pioneers in building something special in our city – they have helped me champion the local industry and attract new jobs and investments here. I look forward to seeing Cinespace and the entire film sector in the city with all the jobs that rely on it continue to grow over the coming years.”
TPG Real Estate Partners (TREP) is the dedicated real estate equity investment platform of global alternative asset firm TPG (a major investor in CAA). Today, TREP has $5.3 billion of assets under management.
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