Bronfman’s sunny forecast for Toronto

There is one lone book adorning the table in the lobby of William F. White's west-end Toronto headquarters: Pinewood Studios: 70 Years of Fabulous Filmmaking. Until last year, as far as the local industry was concerned, Pinewood was just the place where the James Bond franchise and countless other British films were shot. But now it is the preeminent soundstage operator in town, after having taken over management of the city's megastudio from the Filmport folks.

There is one lone book adorning the table in the lobby of William F. White’s west-end Toronto headquarters: Pinewood Studios: 70 Years of Fabulous Filmmaking. Until last year, as far as the local industry was concerned, Pinewood was just the place where the James Bond franchise and countless other British films were shot. But now it is the preeminent soundstage operator in town, after having taken over management of the city’s megastudio from the Filmport folks.

One player who has remained throughout that transition is Whites topper Paul Bronfman, who held on to his 20% stake in the studio complex, of which he is now chair. So, all told, the fate of the Toronto service sector is of primary importance to the 52-year-old member of the Bronfman family dynasty.

The 50-cent tour of Whites’ warehouse is at once impressive and troubling: impressive for the scope of the equipment supplier’s stock, troubling for the fact that said stock is here in the warehouse and not out on film and TV shoots. But winter in Toronto is traditionally off-season, and there are nonetheless some notable projects on the go, including Saw VII. On this afternoon, Whites staff is assembling a gear package for the Bruce Willis actioner Red.

In fact, Bronfman expects Q1 2010 to be the best first quarter in eight or so years, with that momentum carrying over into the crucial summer shooting season. And the Whites chair and CEO is one who speaks his mind. He has on more than one recent occasion described the state of the local industry as ‘a disaster,’ so when he says things are looking up, you believe him. He attributes the uptick to the improved Ontario Production Services Tax Credit, which goes beyond previous labor rebates to also cover production costs such as equipment and studio rentals.

‘If the Liberal government had not realized that Ontario was in a huge competitive disadvantage, we’d be in real trouble. We have to thank the Quebec government for inspiring the Ontario Liberal folks to match what Quebec did, because Quebec thought they were going to run away with all the business,’ says Bronfman, who closed Whites’ Montreal office in 2003.

But despite this little bit of winter sunshine, there’s no denying the industry isn’t what it was a decade ago. The general downward trend contributed to Whites’ decision to sell its camera department to Panavision in 2004. ‘Thank God we did, because the last five years have changed so much,’ Bronfman says. ‘It was a good five years to be out of the camera business.’

It also has proven to be a competitive disadvantage, especially with Canadian producers, who could go to chief competitor PS Production Services for complete camera and gear packages. And that is why the new year has seen Whites launch a new affiliation with digital camera house Sim Video. ‘We’re able to offer producers a package [including cameras] on one quote. If they don’t want one, that’s fine, too,’ Bronfman says.

This new partnership promises to be fruitful as more productions embrace digital imaging and the Red One system in particular, as Sim recently became Canada’s first certified service center for the Red camera.

The industry’s contraction, blamed largely on the end of an exchange-rate advantage for Hollywood productions, has forced other adjustments as well, including increased focus in Whites’ backyard.

‘We realized we were not doing nearly enough Canadian producer work,’ Bronfman acknowledges. ‘If we were going to have any chance of doing work for the Shaftesburys and all these other good producers, we were going to have to cut our margins by about 40%. Otherwise we were not going to do the work, because there are other companies out there that work on that level. And we did.’

Local productions might not bring in the same scale of pay as their American counterparts, but working with them represents a more reliable business model because those clients aren’t going anywhere. Hollywood producers, on the other hand, now have many states with attractive tax incentives from which to choose. But this doesn’t mean Bronfman is giving up on Tinseltown.

‘We need a balance between service and Canadian,’ he says. ‘Without the American work it’s very hard, if not impossible, to maintain the world-class technical-standard production gear you really want to have. At Whites we’re known for the bells and whistles, which is great for American producers, but Canadian producers frankly don’t care that much that our camera car was on The Dark Knight in Chicago.’

One aspect of Whites’ business that allows it to mark down costs for locals is that if work is slow in Toronto, gear can easily be moved to regional offices where it is most needed: Vancouver, Calgary, Edmonton, Regina, Winnipeg, Ottawa or Halifax. The situation at Pinewood, however, is not so fluid.

‘Those bricks and mortar we can’t move. Our built-in costs in Pinewood Toronto are huge,’ Bronfman explains. ‘We will have two-tiered pricing. I’ve said that to Canadian producers: when we have available inventory, we will try to make our rates meet your budget. But it’s much harder to do that down there.’

One might question the soundness of investing in soundstages in Hogtown, which will always be at a disadvantage to Vancouver in terms of weather, scenery, proximity to Hollywood, and time zones. And Bronfman’s been in the B.C. studio biz before: his Comweb Group opened North Shore Studios in 1988 and sold it to Lionsgate eight years later. And he admits he was looking at buying it back or investing in The Bridge Studios before setting his sights back on his adopted home of Toronto.

‘We felt that Toronto really needed more studio space than Vancouver,’ he says. ‘Our timing was pretty bad on [Filmport] when we opened it up.’

After the long-awaited but under-booked Filmport very quickly ran into trouble, original majority shareholder The Rose Corporation and president Ken Ferguson stepped aside to be replaced by investors ROI Capital (which now owns 46%), Castlepoint Developments (14%) and the Toronto Economic Development Corporation (20%). Pinewood came on board with a five-year management contract and is expected to eventually assume an equity position. After some soul-searching, Bronfman decided to stand pat.

‘The investment is so under water – it’s not worth a lot today,’ he says. ‘So I either had a choice of really just cutting my losses and getting out or moving forward. But it had to be with the right people.’

He was familiar with the local investors, but Pinewood Studios Group, despite its name, remained an unknown quantity. The U.K. company, which counts filmmaking brothers Ridley and Tony Scott among its shareholders, installed veteran film and TV executive Edith Myers as the Toronto facility’s managing director. Pinewood’s contract includes a revenue-sharing arrangement that keeps it incentivized, and Bronfman has otherwise been impressed by them.

‘They get it,’ he says. ‘They understand. They talk the lingo. They have the same relationships that we do. It’s seamless.’

Whether Pinewood’s name and relationships significantly boost work at the Toronto studio remains to be seen. So far, so good: the complex is currently hosting the thriller Dream House directed by Jim Sheridan and starring James Bond himself, Daniel Craig, and March will bring the shoot for a prequel to horror flick The Thing.

Bronfman is also excited about a deal that should close in March for the William F. White Centre, his shop’s new 338,000-square-foot home near its current address. About half that space will be open to other service and infrastructure companies. The location seems fortuitous in light of news that Cinespace Film Studios will be building new soundstages nearby. ‘There will be some good business for us, and there’ll be some good business for our competition,’ Bronfman says. ‘It’s good for the industry.’

Despite his newfound rosy outlook, there have been belt-tightening measures, including some staff taking salary reductions. On a smaller scale, last year the CEO sold the company season tickets to his beloved Toronto Maple Leafs, for whom he has cheered since 1962 – even when his father Edward and uncle Peter owned the Montreal Canadiens in the 1970s.

‘The Leafs really suck this year,’ he laments. ‘We really did it to save costs, because when times are tough, Leafs tickets are frills. I’d rather keep our people employed than go to hockey games.’