Editors’ Note: Deadline’s Reopening Hollywood series focuses on the complicated effort to get the industry back on its feet while ensuring the safety of everyone involved. Our goal is to examine numerous sides of the business and provide a forum for leaders in Hollywood who have a vision for how production could safely restart in the era of coronavirus.
Before the pandemic left its nine soundstages empty, Blackhall Studios in Atlanta was bustling with production. Chairman and CEO Ryan Milsap said the place is currently a “ghost town,” but he’s optimistic that will change soon, hopeful that a surge of business will reverse the massive losses his and every studio has absorbed since film and television production shuttered abruptly in March.
While Atlanta’s financial incentives established that city as one of the country’s biggest production hubs, the city has been challenged beyond the pandemic. It is a focus of the racial justice protests sweeping the nation after police there killed Rayshard Brooks last week, and Georgia is still shadowed by a temporarily halted abortion ban that last year had some in Hollywood threatening to boycott the state.
“Our revenues were off $1 million a month during COVID,” Millsap said. “That’s a huge hit. We can survive it. But COVID will have easily cost us nearly $5 million, assuming production starts back up soon.” He has prepared for that moment, spending heavily to retrofit with air purifiers, foot pedals for toilet seats and touchless appliances. Blackhall has laid out about $1 million for COVID-related safety upgrades, he said.
Six of Blackhall’s soundstages emptied out in February when HBO and Paramount wrapped, respectively, HBO’s upcoming horror drama Lovecraft Country and Chris Pratt-starrer The Tomorrow War. Disney planned to move in (Millsap declined to name the project), but the lease hadn’t been finalized before the coronavirus hit.
“That’s just the nature of the business,” he said.
The YouTube Red series Step Up, High Water from Lionsgate and a 20th Century Studios film that he wouldn’t name halted work abruptly on the three other soundstages in mid-March for COVID-19 but continued to pay rent. “They want to restart,” he said. “They wanted to get started last week. Hopefully next week. Every day, they are pushing.”
Despite the adversity, Millsap kept Blackhall’s 12 employees on at full pay.
“This is a rocket ship that’s ready,” he said of the 850,000-square-foot facility (210,000 sq. ft. of soundstages, 640,000 of office space and workshops) serving studios from Disney (Jungle Cruise), Sony (Venom and the last two Jumanji movies) and Warner Bros (Doctor Sleep) to Legendary Pictures (Godzilla: King of the Monsters) and Universal (Blockers) — all part of a tidal wave of tax-credit-incentivized production that’s swept across the state.
The wait to restart has felt particularly long in Georgia since it was one of the first states to ease restrictions on businesses and, in late May, the first to set official safety guidelines for film and TV production. (On May 20, Tyler Perry Studios in Atlanta led the industry in announcing a July 8 production restart date.)
Hollywood unions issued safety protocols for production last week, which Millsap said was a big step forward. Now it’s more about getting all the actors, cast and crew on board. “Individual people still have their own rights,” he said.
“It’s the complexity of the new, because no one has done this,” he said. But like “many entrepreneurial ventures, at some point you have to stop writing stuff down and just do it. The first guys who flew a plane probably did a lot of math, but at some point they said, ‘Let’s see if this baby flies.’”
He has used the time to install safety features (many presaged by Deadline in an April article) including 184 negative-ionization air-handling stations (negative ions attack viruses); metal foot pedals called Hopper Poppers that raise and lower toilet seats; foot-operated door openers on entrance doors to all stage, office and warehouse restrooms; touch-free toilet paper, paper towel, soap and sanitizer dispensers; antimicrobial adhesive tape and shrink sleeves embedded with silver ions on all handles and high-impact touchpoints on doors, push plates, grab bars, toilet levers, faucets and fixtures; hand sanitizing and hand washing stations outside soundstages and at other locations; and personal protective equipment for staff to be used at all times on campus.
Food and drink precautions are up to individual productions, but Blackhall will help structure its space to reduce contact. It has rooms and trailers where cast and crew can self-quarantine or wait out periods they’re not needed on set.
“People can self-quarantine by pod,” Millsap said. “If you work in set design, you can quarantine with people who work in set design, or stay in a hair-and-makeup pod. Keep to tighter circles.”
He said city officials evaluated the studio as a potential triage zone for patient overflow but never needed it.
Georgia alternates (with Canada) for first and second place in terms of major production. Millsap said the state has about 50 major film and TV productions going at any one time. According to the MPAA, the state is responsible for more than 90,000 film and TV production jobs and nearly $4.6 billion in total wages.
It has about 100 soundstages, most built over the past six years. The number is growing. Blackhall’s larger neighbor Pinewood Atlanta Studios outside the city in Fayetteville announced a major campus expansion earlier this year. Blackhall is awaiting a greenlight from local authorities to start construction that would triple its soundstage capacity.
Given Georgia’s heft in the entertainment ecosystem, Hollywood was shaken when Republican Gov. George Kemp last summer signed legislation that banned abortion after a fetal heartbeat is detected – about six weeks in, before most women realize they’re pregnant. Reproductive rights groups sued and a federal judge issued a temporary injunction last fall preventing the bill from taking effect. At a hearing earlier this week the ACLU, which is leading the case, argued for the ban to become permanent. Lawyers for the state asked that the stay be lifted on all or parts of the bill. A ruling is expected in late June or July.
The case caused an uproar last summer when producers from Netflix, Disney, WarnerMedia, NBCUniversal, AMC Networks, Sony, CBS and Viacom (which hadn’t yet merged) publicly questioned whether they would remain in Georgia if the ban went into effect. J.J. Abrams and Jordon Peele, Peter Chernin, Alyssa Milano, Christine Vachon, David Simon and others also spoke out.
Millsap said he was extremely worried last year. “It was a scary time for those of us in the entertainment industry because a law like that would certainly put Georgia in a very awkward position relative to the modern English-speaking world,” he said. “It is a huge disadvantage if you live in a state that has laws on its books that are counter to the majority of society.”
But he thinks the bill is a “political football” and won’t survive. “The governor’s farthest-right support base wanted it and the governor’s farthest right support base asked him for it and … played a key role in getting him elected. That put him in a very complicated position. … I believe the political winds required a bill.” Similar legislation was passed and temporarily blocked in a handful of other states as well last year.
Millsap, meanwhile, hopes to start Blackhall’s expansion work in six months. He now has a partner and backer in private-equity firm Commonwealth Asset Management. The firm bought out Blackhall’s investors (except Millsap), raised a fund and earmarked $850 million in cash and debt to finance the Atlanta expansion and build new production studios, starting in Los Angeles and the UK. The latter deal, which was announced in February, is an agreement with the University of Reading for a film studio and digital creative hub just outside London set to open in early 2022.
Los Angeles-based Commonwealth, which specializes in real estate investment, is awaiting approval to build a 500,000-square-foot studio facility in the San Fernando Valley just north of Walt Disney Studios and Burbank. All projects will be under the Blackhall umbrella.
Millsap said they hope to have “shovels in the ground” in London by next summer and L.A. by the end of next year.
Adam Fisher, founder of Commonwealth and former global head of Macro and Real Estate at Soros Fund Management, said his firm considers few but big global real estate plays and production checked all the right boxes.
“We’re pretty ambitious about the space, we feel it’s undercapitalized,” Fisher said, noting the surge in content production and appetite for premium programming.
The demand for production space is greater than ever, so “it’s important there is a high-quality infrastructure to meet it,” he said. “There are old warehouses and cold storage facilities converted all over Hollywood. But the problem is, if you’re doing a really big production, you need [storage] space, offices. Movie lots have that in one location, but with few exceptions globally, [nothing is] really scaled the way the studios are.”
Fisher was introduced to Millsap about five months ago through a mutual acquaintance. “Ryan is a big, entrepreneurial guy. … He’s one of the few guys who have invested in this in a large scale,” said Fisher.
“I am not the only one with a great idea,” Fisher said, but “I wouldn’t’ chase something where I thought there was only room for one more soundstage.”