Large San Marcos Film Studio Secures Incentives

Both the Hays County Commissioners Court and San Marcos City Council on June 7 approved incentives agreements for an 820,000-square-foot “state-of-the-art motion picture studio facility” at 6202 West Centerpoint Road in the La Cima master-planned community. The project is slated to include 12 sound stages, four workshops, backlots, production offices and commercial space.

Hill Country Studios, a subsidiary of Hill Country Group LLC, has proposed building the studio on 75 acres of a 209-acre plot in three phases, starting in April 2023 and completing everything by 2025, according to Council documents. Phase 1A would include seven production stages, two workshops and a welcome center, while phase 1B would include 250,000 square feet of office space. Phase 2 would include five additional stages, two workshops and support space.

Overall, the project will include 12 sound stages across 310,000 square feet, two back lots totaling 15 acres of outdoor production space, 310,000 square feet of modular offices and four workshops. It will also feature two identical virtual production stages with a 75-foot diameter performance space and lifestyle and workplace amenities, including a 50-seat screening theater and a full-service restaurant and coffee shop. Twenty-five acres will be reserved for vendor and commercial space.

The project has an estimated capital investment of $267 million and would employ at least 44 people with an average salary of $100,000, according to public filings. Additionally, officials estimated that the project would result in the employment of 1,400 contract workers with an average of 1,200 on production projects at an $80,000 average salary. Officials also committed to participate in an internship program for students.

“What started as a dream to elevate the production industry in Texas, is now becoming reality,” Hill Country Studios co-founder and CEO said Cory McLoud said in a statement. “Recognizing the revolutionary potential of Virtual Production, Hill Country Studios aims to place the film industry in the epicenter of the innovation corridor in Texas. We couldn’t think of a better place to propel the entertainment industry with a world-class studio space than our own backyard.”

“San Marcos was the clear-cut choice of where we wanted to be doing business,” Zach Price, Hill Country Studios co-founder and Chief Operating Officer said in a statement. “The natural beauty of the Hill Country, as well as the local workforce and close proximity to the talent pools of Austin and San Antonio, made perfect sense for us to locate our film production studio in the Texas Innovation Corridor.”

The Hill Country Group includes studio consultant David Godfrey and architect Bill Foley, described as “two of the world’s top experts in studio design and operations.” The two have experience working on film studio projects in China, Malaysia, the Dominican Republic, Ireland, Turkey and Wales, as well as in Atlanta. San Marcos-based Bowman Consulting Group was identified during the meetings as the civil engineer.

Representatives described their target productions as “tier one clientele,” meaning they hope to attract the Big Five studios — Universal Pictures, Paramount Pictures, Warner Bros., Walt Disney Pictures and Columbia Pictures — as well as streaming providers and smaller independent productions to fill in the gaps.

Officials said they are not concerned about Texas’ relative paucity of filmmaking incentives. The state has recently seen notable departures such as TV show “Fear the Walking Dead.”

“To date, there has not been a studio investment like this in Texas. The Hill Country Studios team is well-positioned to take advantage of film industry interest in this great state,” a spokeswoman said in email. “We are excited to work in a state with a strong business environment and a high level of community support. The goal is to elevate the film industry in Texas and Hill Country is confident the state sees the benefit of further investment in the industry.”

Incentives approved for ‘Project Dark Monday’

The film studio project was codenamed “Project Dark Monday” at both Hays County Commissioners Court and San Marcos City Council.

Earlier in the day, county commissioners unanimously approved a Chapter 381 agreement for the project. Officials said the deal provides an estimated $1.6 million in property tax abatements over a five-year period starting in 2025. It starts at 90% and decreases to 20% by Year.

After the vote, members of the court lauded the project as “the largest film studio in the country,” although there are several in the country that are bigger outside of Hollywood, including Trilith Studios near Atlanta area with more than 1 million square feet of production space.

“Art and creativity are core elements in the culture of Hays County, which is a perfect match for Hill Country Studios,” Hays County Judge Ruben Becerra said in a statement. “This new major employer will undoubtedly be a contributor in bringing additional good-paying jobs and new art that will amplify the creative minds that live here in Hays County.”

Later in the day, San Marcos City Council voted 6-1 to approve a five-year Chapter 380 agreement that would that would start with a 90% property tax rebate once the studio is fully built and decrease to a 20% rebate by the end of the deal. That was estimated to be $3.7 million in property tax rebates over the course of the agreement, while the city would retain $11.5 million over a decade. The city is expected to collect $2.1 million in property taxes before the incentives become active in 2025.

Officials discussed several concerns about the project, namely environmental impact because of the studio’s location in the Edwards Aquifer Recharge Zone. But officials said the development, which is already entitled as part of the development agreement for La Cima, would offer tighter environmental regulations compared with other commercial development. The majority of Council ultimately cited the economic benefit of the project before voting to approve the incentives.

“We have a great opportunity to diversify our economy and have high quality jobs in film and television,” said Jude Prather, Place 6 councilmember for the City of San Marcos, in a statement. “This film production studio is a testament to the creative culture we have here and another example of the quality businesses we aim to attract here in San Marcos.”

This would be the second large film studio being developed in the Austin area. The Bastrop 552 project could eventually have 486,000 square feet of studio space, 300,000 square feet of warehouse/mill space and 200,000 square feet of office space in a horseshoe bend of the Colorado River, owner Alton Butler has said. It remains on track to open on 546 acres near the city of Bastrop in August 2023.

The Hill Country Studios project would also mean an influx of jobs for San Marcos, which is located along I-35 between Austin and San Antonio in one of the fastest-growing regions in the country.

Courtesy of Austin Business Journal. See the full article here.