31 July 2010

Pontiac Movie Studio Moves Past the Idea Stage

The Detroit Free Press

Linden Nelson, A. Alfred Taubman, John Rakolta and others from Raleigh Studios will break ground Tuesday on an $80-million movie studio at a former Pontiac truck plant.

Two years after Gov. Jennifer Granholm and state leaders introduced the nation's most lucrative film incentives, Raleigh Michigan Studios is among the first to have brick and mortar results.

The involvement in the project of Raleigh and William Morris Endeavor Entertainment -- which have extensive television experience -- has led to optimism that Michigan could attract more TV projects.

"They are stamps of credibility," said Chris Baum, head of Film Detroit, which markets the region for production work. "We think this will be a positive step to make us a legitimate film center."

Carrie Jones, the incoming head of Michigan's Film Office, said: "This puts us in a better position to land more TV series."

The studio -- at a shuttered General Motors plant on the Center Point campus -- was the brainchild of Nelson, who runs a local development firm.

Besides remodeling the existing plant, the partnership will build a 200,000-square-foot building and hire 3,000 people within three years.

Nelson is chairman and CEO of the studio and pulled together the team.

Putting together a movie studio in the wake of the 2008 global credit meltdown was daunting, Taubman said.

"It's been the most difficult deal I have ever done," said the 86-year-old billionaire developer, who marveled at the 300-plus documents associated with it.
There at the beginning

The Raleigh studio was among three Granholm talked about when she first broached the idea of Michigan becoming a center for filmmaking.

One in Allen Park is still evolving with Detroiter Jimmy Lifton as a tenant. The other, in Detroit, didn't materialize.

Nelson's group won tax incentives from the state and from federal recovery zone facility bonds. Included was $28 million in bonds from the Oakland County Economic Development Corp.

Since April 2008, when the incentives began, 96 movie or TV productions have been filmed in the state. Michigan allows companies to file for refundable tax credits worth up to 42% of a film's production costs. That means if the tax credit is more than the tax bill, the company gets the difference in cash from the state.

Critics say the incentives are so lucrative that the state can never break even. Promoters counter that projects like Raleigh's will lead to more investments with long-term benefits.

"This will be the catalyst for a lot of jobs, ones that will hopefully keep more young people here," Nelson said.

Construction on the sprawling studio should be complete by early 2011, Nelson said.

When the studio is completed, more post-production work will be done here.

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