Vancouver: It’s said that if you ask any Los Angeles film executive in the know what’s going on in Vancouver, he or she will be able to tell you the names of U.S. productions underway at any studio here. It’s a party trick of growing difficulty, however, as the city’s soundstages proliferate to meet the continuing demand from the U.S. and abroad – producers who want to take advantage of shooting in Lotus Land.

At last count, Vancouver boasted more than 60 developed soundstages and 30 raw warehouses ready for production. Excluding the slew of production support spaces, Vancouver has 1.85 million square feet of contained space dedicated to movie making. That’s the equivalent of 13 fields at SkyDome for those of you in Toronto.

For the fifth annual Production in Vancouver Roundtable, Playback brought together the major innkeepers of Vancouver’s stages. Susan Croome is GM of the venerable Bridge Studios in Burnaby. Peter Leitch is GM of Lions Gate Studios in North Vancouver and will have the newly constructed Stage 8 ready for business Jan. 1, 2002. Pete Mitchell is GM of Vancouver Film Studios, which has the most stages for rent in Vancouver and two more on the way. Dian Cross is president of The Crossing Studios in Vancouver. And entrepreneur Betty Thomas of Thomas Studios has one stage in North Vancouver and a bit of studio news, as you will see below.

As a group, 85% of their business comes from U.S. service productions. They enjoy occupancy rates of 70-90% most of the year. And they think Vancouver has the right business formula to keep business growing at double-digit velocity for many years to come.

Playback: The threat of a Screen Actors Guild strike earlier this year had a chilling effect on production in Vancouver this summer. What was the impact on you?

Susan Croome: We had a few holes in our occupancy that we wouldn’t normally have seen at that time of the business cycle.

Betty Thomas: I didn’t get the lull at all. I was fortunate because one of the projects [TV movie A Wrinkle in Time] had finished principal photography and we had miniatures to do, so I still have them in the studio.

Pete Mitchell: We felt it for sure. You could have shot a cannon through the lot and wouldn’t have hit anybody. But now, in terms of the general market, you look at the people who are building stages, proposing to build stages, and trying to get their warehouses in and it’s very healthy. Producers should be reassured that there is a lot of thought and capital going into Vancouver right now.

Playback: So there is a lot in development?

Peter Leitch: To say a lot might be an overstatement. There has always been this interest in people developing stages, but you don’t see it happening a lot. But the legitimate players, like ourselves, we’re building another soundstage.

Mitchell: We have two more.

Dian Cross: We are always considering expanding, but it has to be the right building. A lot of people take over a warehouse and it’s got 19-foot ceilings and they say, ‘Okay, this is a studio now.’ I’ve probably looked at a hundred buildings in the last year and not found anything I think is suitable.

Mitchell: Would you consider building?

Cross: Yeah, but not right now. I’d like to see how things go in the fall. Business is definitely picking up and it’s supposed to carry on. I’d like to see what happens with all these [studio] proposals kicking around right now.

Playback: The Bridge has considered expanding for years. What’s happening now?

Croome: Because we are a provincially owned asset, we need to take our lead from the shareholder. There is a new government in and there is core review happening. We would like to expand and we’ve got land at Bridge. The market really supports more growth.

Playback: But you did build your newest stages in partnership with MGM. What about doing that again?

Croome: Like any developer, we did a pre-lease and on the strength of that we financed the project.

Cross: You make it sound so easy. (laughter)

Mitchell: One of the reasons that so many projects fail is because it’s impossible to do that [secure pre-leases].

Thomas: Well nobody has heard this yet, but I’m building a studio [as early as February]. It’s not the kind of studio that will be in competition with anyone sitting here, but it’s what this city needs…a dual-purpose wet tank.

I have the property already, minimum four acres, possible five. It’s almost outside my back door in North Van. The tank would be a 14,000-foot actual tank, with 40-foot clear span inside and a depth of 21 feet. We’ve been involved in every big feature that has anything to do with water. And what better people to actually be involved in building a tank than a special effects company?

Everyone: That’s great!

Leitch: That’s something as a studio owner Lions Gate would welcome because it enhances the industry. If someone says they are going to build six other stages beside us, we’re not too thrilled with that – it could drop our occupancy from in excess of 90% to 70%, where it is pretty marginal. We want managed growth so that it doesn’t have an impact on the existing facilities.

Thomas: As I’m doing my budget [for the wet tank], I’m very cognizant of [the dangers of] being overly optimistic and doing an 80% projected occupancy. Boy, that’s really full. And while I would love to say that’s the figure I’d be looking for, I’ve done the numbers for a 50% occupancy, and a 70% and a 75%. I dare not go to 80%. I’m a realist. With my little studio, I’m just barely hitting 70% now in my third year.

Mitchell: Any discussion about studios has to incorporate a discussion about risk. The risk is the industry and it turns on a few factors: exchange rates are important. But then there are the prevailing winds from the U.S. And then there is our own internal stuff. You look at what’s happening in Montreal and Toronto right now [with ACTRA] and the perceived risk of a potential strike. We’ve got a couple of productions [like the feature Daredevil] that just up and moved here. It’s a very mobile capital. You really have to salute the Union of BC Performers and their management of their relations with producers because it has been a real asset.

Croome: Studio costs are highly fixed, so it’s not like you can pull your horns in when you have a bad couple of months. The business looks great until you’ve got some vacancies that are dropping against your bottom line.

Cross: And studios are high maintenance. A lot of people think you can throw up a building and open the doors and people will come running. They don’t recognize that there is a massive amount of ongoing support for every client.

Mitchell: If you look at the classic real-estate model – and a lot of people trying to get studios together come from that background – one lease can be signed for 10 years or longer. Our longest leases are six months. So the turnover creates extra costs. It’s not a classic real-estate business; it’s a service business.

Playback: Can you service the Canadian producers? They don’t seem to be able to rent your stages.

Croome: It’s not that they can’t afford our stages. A lot of times, they don’t have budgets to do construction and big builds. So they don’t need stages so much. They might need something small; they go on location. It’s more about the nature of the productions they are doing.

Mitchell: There is also a strong, healthy tradition in Vancouver of people supporting the Canadian industry. There is a very self-centered reason for doing it…people working on [a smaller] show, maybe five years from now or maybe next year, will come back with a big show that needs three stages.

Playback: The industry has worked hard to expand the work Vancouver can do. How are you diversifying?

Cross: My background is in production as a producer and PM for 15 years, so my goal when I started the company was always to get back into production. Now that we have studios up and running and the equipment [business] has established itself, we’re going to be focusing on production services for companies primarily overseas – Japan, India and other markets that are just starting to hear a lot about Vancouver. We are not going to go after the American market per se, because we have a good relationship with all the local production managers and we don’t want to take work from them.

Playback: And how do you work together?

Mitchell: We do engage in joint marketing trips.

Cross: Our priority beyond booking our own stages is making sure that producers are being accommodated. We all call each other on a regular basis.

Playback: So you are grinding prices…?

Leitch: That really hasn’t happened. Maybe it’s because of the volume of work. It’s certainly not our strategy to go head-to-head in a price war. What we do is keep our prices very reasonable. L.A. sees us as being very fair in our prices, if not on the low side, and we like to maintain our prices and a reasonable increase each year to be consistent with our profit margins.

Playback: What has to happen to keep Vancouver’s incredible growth going another 10 years?

Mitchell: People understate the impact that the creation of the BC Council of Film Unions has had on the industry. Before that we had bargaining chaos. Since the imposition of that structure, it’s settled out and we are now the ‘sane’ people from Canada – a bit of a unique situation for B.C.

Protectionism in the U.S. is an issue we have to watch. It’s building now in Washington, so we have to get in there and make sure that people know the facts, which is that we only do somewhere around US$1.5 billion worth of production per year and that’s been overstated by a factor of 10 down there. We’re 10% of the audience and we do 3% of the work. It’s also keeping up with the infrastructure, the training, equipment and gear to meet the demand.

Croome: We all want to support the growth of the domestic industry so that the more we can grow our own industry here, the less vulnerable we will be to changes to production services work. We are seeing that segment of the market grow faster than production services and it’s a great trend.

Leitch: We should keep doing what we are doing. Managed growth. Focus on education of crews. Maintaining our level of competency. Hopefully the dollar will stay competitive, the tax credits will stay competitive. But we have to keep that level of nervousness.

-www.crossingfx.com

-www.vancouverfilmstudios.com

-www.bridgestudios.com

-www.thomasfx.com

-www.lionsgatestudios.com