White paper by Ace Salvador, Q3, 2024
In an era of unprecedented content demand, film studios around the world are discovering new revenue streams to bolster their bottom line. One notable trend that has emerged is the rental of studio stages to external productions—ranging from blockbuster movies to independent features, and from high-end commercials to digital shorts. This white paper delves into the financial dynamics and strategic benefits of this practice, revealing how studio stage rentals have become a lucrative and vital component of the global film industry’s economic framework. Through in-depth analysis and case studies, we will shed light on the factors driving this trend and its implications for the future of studio profitability, and why such a studio is necessary for a rapidly expanding economic powerhouse country such as the Dominican Republic.
While Hollywood has always been recognized as a recession-proof industry, The last decade has witnessed an explosive growth in streaming content, revolutionizing the way audiences consume entertainment and reshaping the contours of the film industry. As traditional cinema viewing intertwines with the convenience of on-demand platforms, there has been a surge in the production of diverse content, from niche indie projects to lavish episodic series. Major streaming giants, such as Netflix, Amazon Prime, and Disney+, have invested billions, stoking this expansion and creating an insatiable appetite for fresh narratives. This proliferation has not only democratized access for creators across the globe but has also infused the industry with unprecedented financial and creative opportunities. As the lines between film, television, and streaming blur, the industry stands on the precipice of an era where content, unhindered by traditional formats, reigns supreme.
The result of this streaming renaissance has created a growing need for studios to rent out stage space to many productions to keep up with the demand for these streamer-distributors. Already a highly profitable venture, especially with presentation of tax incentive programs by countries, studios around the world are renting their stages to many production companies for television shows, films, commercials and more.
Here are some examples:
1. Pinewood Studios in the UK recently announced their 2020 financials, with film and television production activities bringing in a total of £119 million from stage rentals alone – a 2.2% increase from 2019.
2. Warner Bros Studios in California also saw an increase in revenues, with their stage rental division generating $184.6 million in 2020. This was an impressive 5.4% rise from the year before.
3. In Germany, Babelsberg Film Studio reported success this YE with €76 million generated from studio rental services – up 3% compared to 2019’s figures for the same period.
4. In 2019, Universal Studios in Los Angeles earned a net revenue of 8 billion US dollars from renting out its stages to feature films and television series. The studio held the highest regional market share compared to other studios located in the region.
5. Rising Sun Pictures, an Australian based visual effects and animation production company, generated 4 million dollars in revenue from its film studio rentals for feature films and television shows. It holds a market share of 68% within Australia for renting out their staging facilities to productions.
6. Film City Mumbai is one of India’s largest filmmaking industry bases and has received up to 54 million dollars in rental revenue since 2014 when it started offering its stage rental services to films making their way through the Bollywood industry.
Sony Pictures Studios in Los Angeles has been renting its stages to productions for over 70 years, allowing them to generate significant income. Another example is Pinewood Studios in the United Kingdom: they have rented their stages to films such as The Angels Share and Wonder Woman 1984. In South America, studios such as Cineland Bogota provide rental services at reduced rates compared to other film studios around the world. Additionally, international production companies often rent space on other continents when making overseas projects; for instance, Peregrine Productions rented studio space in India for their Bollywood biopic of Mahatma Gandhi’s life.
The following regions offer some of the lowest rental rates for studio space: Bulgaria, Hungary, Romania. When taking into consideration discounts and tax incentives that are available in these countries, it is clear that productions will gain a greater return on investment when selecting one of these locations. For example, Studios Bulgaria offers up to 30% off standard rentals through its Corporate Month program. Additionally, Bulgaria’s incentive program provides up to 25% cash rebate for eligible TV series and feature films shot there. Similarly, Hungary and Romania also offer some tax concessions which can prove financially beneficial for productions renting in those countries.
Economic Incentive for cities and towns
Film studios play a pivotal role in the economic rejuvenation and diversification of the cities and towns they inhabit. Beyond the direct employment they provide—from on-screen talent to a myriad of behind-the-scenes roles—they catalyze a ripple effect through local economies. Catering services, lodging establishments, transportation, and even local retailers experience a surge in demand, providing a significant boost to the local job market. Furthermore, the allure of a bustling studio often attracts tourists and film enthusiasts, promoting local tourism and elevating the area’s cultural significance. Over time, regions that host studios often see an influx of secondary businesses, including post-production houses, equipment rental agencies, and training institutions, solidifying the area’s reputation as a hub for creative industries. This symbiotic relationship between studios and their surrounding communities ensures that the economic benefits are felt long after the director shouts, “Cut!”
Here are just a few examples of how film studios generate revenue from existing and allowing productions to flow through them:
- In the UK, Pinewood Studios is responsible for bringing more than 20,000 jobs to Buckinghamshire county with an estimated £845 million contribution to the local economy in 2018.
- Warner Bros production of Birds of Prey (2020) introduced over 3,400 job opportunities as well as an estimated $117 million spent on goods and services in downtown Atlanta, Georgia.
- Studio Ghibli’s Sen to Chihiro no Kamikakushi (2002) filmed primarily in a single suburb of Tokyo resulted in a 24% increase in tourism for that area and increased its fame internationally.
- Walt Disney Pictures generated 800 direct jobs through their films shot at Leavesden Film Studios across Hertfordshire County between 2013-2016 with a total intraregional impact estimated at €250 million per year according to research conducted by Pinewood Group plc.
- In 2010, Paramount Pictures established the Paramount Pictures International London Studios in Longcross Studios, Chertsey, England. The studio was able to create jobs for more than 600 locals and resulted in an increase of almost £77 million a year for the local economy.
- In 2014, Marvel Studios opened Pinewood Atlanta Studios in Fayette County, Georgia. This has created around 2000 jobs for locals and attributed around $7 billion to investment into Fayette County since construction began. It is also estimated that Pinewood Atlanta produced $20 million worth of spending in the local area annually contributing towards tourism and accommodation options for those visiting the city for production purposes.
- In 2017 after its completion and grand unveiling, Universal Studios Beijing welcomed thousands of visitors from all over China to enjoy its many attractions built at a cost of some $19 billion After opening it’s doors, it was estimated that some 10, 000 people were employed within operations related directly to the Universal Studio operations bringing direct benefit to those working with wages ranging from just above minimum wage up to managers receiving high income salaries dependent on their role and responsibilities in relation to operation activities conducted at Universal Studios Beijing.
- The Warner Bros. Studios Leavesden filming complex located outside of London, United Kingdom which employs over 3,000 people and since opening has rebuilt the region’s economy by bringing in £25 million a year.
- Pinewood Studios Atlanta location – efforts from local city officials encouraging incentives for productions to be based at this particular studio allowed it to open its doors nearly two years ago. The regional economy saw an immediate boost with 6-7 thousand new jobs established along with up to $625 million dollars invested annually thanks to television shows and movies filmed there such as Marvel’s Ant Man and Guardians Of The Galaxy 2.
- 10. When Walt Disney Studios opened in Burbank, California, it ushered in a new era of prosperity for the town. The studio created thousands of jobs, generating revenue from nearby restaurants and hotels catering to visitors coming to Los Angeles as well as those employed at the studio itself. Economic impact studies have revealed that in 2017, the film industry supported nearly 40 thousand jobs within the city and county and generated more than $1 billion in income annually.
- 11. In Atlanta Georgia, films such as Marvel’s Avengers series helped spur economic growth with an influx of high-paying jobs said to total an estimated $5 billion since 2012. This includes construction workers building permanent sets, temporary work systems such as security lines or food vendors for hired on a case-by-case basis. Tourism also increased with production companies creating movie tours highlighting locations featured in these celebrated features.
- 12. Films like James Bond have helped put places like Pinewood Studios near London on the map when it comes to international productions – bringing money both directly onto sets through investments from foreign investors but also indirectly into local areas arounds them where much of the filming takes place alongside various other supportive businesses necessary for production houses setups (location scouts etc).The economy got even brighter when June saw theatres reopening with British productions led by Tenet grossing over 500 million worldwide and setting new box-office records in various countries including Russia and Korea.
Dominican Film Industry
In the past decade, the Dominican Republic has witnessed a remarkable surge in the development of its film industry, largely attributed to robust government support through film tax laws 34 and 39. This growth has propelled the country’s film infrastructure to become a significant player in the Latin American cinema landscape.
Economic Impact
The film industry’s economic impact on the Dominican Republic has been substantial, significantly contributing to the country’s revenue and various sectors. This progression is evident in the monetary influx, with the industry generating the following revenues:
– 2017: $29 million USD
– 2018: $60 million USD
– 2019: $66.5 million USD
– 2020: $135 million USD
– 2021: $254 million USD
– 2022: $220 million USD
According to President Luis Abinader, this surge is further substantiated by statistics of over 5,000 employees engaged in the production of 101 audiovisual works in 2021. The industry’s impact is far-reaching, directly influencing sectors like hospitality, transportation, construction, and food and beverages, consequently benefiting small product and service providers. The country has also hosted some of the largest studios and production companies in the world, such as Paramount Pictures, Netflix, Universal, Lionsgate, and Disney.
Industry Highlights in 2022
The year 2022 proved to be the most remarkable period for the Dominican film industry yet, featuring:
– A total expenditure of $310 million USD
– 125 productions, comprising 60 films without tax incentives, 53 local Dominican films, and 12 foreign films under Law #39
– Registration of 1,335 additional crew personnel with SIRECINE
– Registration of 82 additional businesses servicing the film industry
– Local cinema attendance of 1.5 million
Government Support and Tax Incentives
The growth of the Dominican Republic’s film industry is largely due to two pivotal film tax laws: 34 and 39.
– Article 34 (Local Productions): This law allows legal entities investing in approved Dominican feature film works to deduct 100% of their real value investment from their Income Tax, encouraging local production.
– Article 39 (International Productions): Film producers engaged in pre-production, production, and post-production stages of feature films in the Dominican Republic can benefit from a transferable tax credit equal to 25% of related expenses incurred. This attracts foreign filmmakers to choose the country as a filming destination.
Cinematic History
The Dominican Republic’s cinematic legacy dates back to the 1970s, a period marked by visionary recognition of the country’s potential by Charles Bluhdorn, the CEO of Gulf & Western. His fervent passion for the Dominican Republic translated into substantial investments in the societal and economic progress of what he called a “Filmmaking Mecca”. Bluhdorn’s influence materialized through the filming of acclaimed works like “The Godfather Part II”, “Sorcerer”, and “Apocalypse Now” within the country. This pivotal moment laid the foundation for the Dominican Republic’s ascent as a preeminent filming hub. Since then, the country has consistently attracted a robust stream of high-profile productions, solidifying its reputation as a coveted location for filmmakers. Among the productions that have chosen the Dominican Republic as their canvas are Michael Mann’s “Miami Vice”, Robert De Niro’s “The Good Shepherd,” Steven Spielberg’s “Jurassic Park”, various installments of the “Fast & Furious” franchise, David Fincher’s “The Killer”, and more recently the Korean Netflix series “Narco-Saints”. This popularity is on a continual rise, evident in the country’s increasing acclaim. The country’s experienced yet affordable local crews, support from the General Directorate of Cinema (DGCINE), and attractive tax incentives add to the appeal of the Dominican Republic as a sought-after filming destination. There are currently only three professional film studios operating in the country:
Pinewood – Located in Juan Dolio, on a 43-acre site and just 20 minutes from Santo Domingo International airport, Pinewood Dominican Republic offers an 8-acre facility for water filming with infinity sea views, professional diving and marine support. State-of-the-art sound stages, production support services and access to a host of tropical locations make it a world-class destination for filmmakers. This is the go-to facility for international production. Having hosted “The Lost City” starring Sandra Bullock, Brad Pitt, and Channing Tatum, Liongates’ “Shotgun Wedding” starring Jennifer Lopez, and M. Night Shyamalan’s “Old”.
La Aldea – A one-stage film studio located in Santo Domingo Este, offering a space for local filmmakers, advertisers, and music artists. La Aldea provides a fully-equipped facility, including all the necessary production equipment, ensuring a seamless and efficient creative process for crafting captivating films, commercials, and music videos. They’ve produced several local films, including HBO’s “Sugar”.
Quita Sueño – They are the first specialized film production studio in the Dominican Republic, offering advisory services for all aspects of film projects (Pre-Production, Production, and Post-Production). With over 40,000 square meters of dedicated space for audiovisual production, they boast two small soundstages and a backlot. Having successfully completed over 35 local feature films and numerous smaller-scale productions, Quita Sueño stands as a prominent player in the Dominican film industry.
Unique Geographic Diversity
The Dominican Republic’s unique geographical diversity, often referred to as a “micro continent,” offers a plethora of benefits for film productions seeking diverse and captivating filming locations. This Caribbean nation boasts a remarkable variety of landscapes, ranging from pristine white-sand beaches to lush tropical rainforests, sprawling mountains, arid deserts, modern-metropolitan cities, and colonial-era cities. Such a diverse array of settings provides filmmakers with the opportunity to shoot a wide range of scenes without leaving the country, saving both time and resources. The Dominican Republic’s weather conditions are among the best in the world, with very predictable summer-like weather all year long, without excessive humidity or rainfall in the rainy season.
Strategic Location
The Dominican Republic’s strategic location in the Caribbean offers filmmakers valuable proximity to major film production hubs, including North America, Latin America, and Europe. Being neighbors with the United States, the world’s largest film industry, grants convenient access to a vast pool of resources, talent, and equipment. Filmmakers can tap into renowned post-production facilities, special effects houses, and equipment suppliers in the US, enhancing their productions with high-quality support and expertise. The country’s strategic position allows for efficient transportation of film equipment and facilitates the movement of international film crews and talent. The availability of multiple international airports and well-connected flight routes to key destinations enhances logistical convenience for filmmakers traveling to and from the Dominican Republic.
Moreover, the Dominican Republic’s geographical location in the Caribbean allows for easy travel and collaboration with other Latin American countries. Many Latin American nations have burgeoning film industries and an increasing number of co-production agreements with the Dominican Republic. This close proximity fosters opportunities for cross-border collaborations, joint productions, and the exchange of creative ideas. The ease of travel between Latin American countries enables filmmakers to explore various cultural landscapes, talent, and stories, enriching their film projects with authentic and diverse perspectives.
Additionally, the Dominican Republic’s location in the Caribbean facilitates access to European film industry resources. European film markets, festivals, and co-production opportunities are within a relatively short distance, offering the Dominican Republic the chance to engage with a global industry.
Local Dominican Films
With the Dominican Republic leading Latin America in local film productions, it’s no surprise that local films have also seen a surge in international recognition and acclaim. “Bantu Mama” made a significant impact at the renowned SXSW festival, attracting the attention of ARRAY, led by Ava DuVernay, for acquisition. Similarly, “Carpinteros” garnered buzz with its highly anticipated premiere at the prestigious Sundance Film Festival, further cementing the Dominican film industry’s credibility. Further triumphs include “Boca Chica,” securing the prestigious Nora Ephron Award at the Tribeca Film Festival, and “La Soga 2,” earning recognition at the Toronto International Film Festival. “Hotel Cópelia” impressed audiences at the Miami Film Festival and secured acquisition by HBO. Additionally, “El Año del Tigre” gained Disney’s attention, becoming the first Dominican film to be acquired by the entertainment giant. With its local box office success, Dominican films have consistently outperformed foreign releases. International acclaim has also been bestowed upon Dominican filmmakers, with Leticia Toño’s “Aire” winning the coveted Latido Award at the Cannes Film Market and “Carajita” earning critical acclaim after its premiere at Tribeca, further solidifying global influence and promising future.
Dominicans in the Diaspora
The Dominican talent within the diaspora has also garnered significant recognition. Jharrel Jerome’s exceptional acting prowess made history as he became the first Afro-Latino and Dominican to win an Emmy for acting, receiving well-deserved accolades for his outstanding talent in the television industry. Dominican actress Zoe Saldaña has achieved a remarkable feat, appearing in the four highest-grossing films of all time: “Avatar,” “Avatar: The Way of Water,” “Avengers: Infinity War,” and “Avengers: Endgame.” This accomplishment sets her apart as the highest-grossing actress of all time. From Hollywood legend Maria Montez to modern stars such as Michelle Rodriguez from the “Fast & Furious” franchise and Carlos De La Mota from the Mexican telenovela “Destilando Amor,” among others, Dominicans in the diaspora have made an indelible impact, elevating the visibility and influence of our country on the global stage. With such trailblazing accomplishments, the potential for even greater achievements lies ahead.
Conclusion
The Vista Verde Eco-Film Studios introduces a pioneering vision for a world-class filmmaking community, catering specifically to producers, talent, and crew, while emphasizing sustainability and productive lifestyle. Nestled in the heart of the Dominican Republic, Vista Verde Eco-Film Studios epitomizes the fusion of economic promise, natural splendor, and industry requisites, aligning with the escalating demand for studio spaces within the contemporary film sector. Anchored by a self-sufficient studio hub and convenient accommodations, the community strives to streamline production processes, reduce environmental impact, and lead the way in the Dominican Republic’s emerging film industry. Our studio will provide everything producers require, from equipment like dollies, cranes, and cameras, to essential services such as catering, lodging, and leisure establishments for downtime. Set against the tapestry of the nation’s diverse landscapes, spanning pristine beaches to lush rainforests, the Dominican Republic emerges as an ideal cinematic canvas, boasting cost-effective production values, a skilled local workforce, and favorable regulatory conditions that collectively entice filmmakers. The introduction of the Vista Verde Eco-Film Studios marks a paradigm shift, harmonizing luxury, eco-consciousness, and functional design to foster productivity, well-being, and stress reduction for all stakeholders.Through seamless integration of self-sufficiency and accessibility, this community aspires to streamline production workflows, minimize ecological footprints, and spearhead the ascent of the Dominican Republic’s burgeoning film industry. Vista Verde Eco-Film Studios is a world-class one-stop shop for film production.