Los Angeles Group Buys Massive Atlanta Studio Complex For $120M

The founder of Blackhall Studios has sold his massive Atlanta film and television production facility to California investors. Now, he is taking the proceeds and transitioning from hosting filmmakers to being one.

Los Angeles private equity firm Commonwealth Asset Management has purchased Blackhall Studios in Atlanta for $120M.

The deal also includes a majority interest in properties in England and California where Commonwealth plans to spend $1B developing new studios, Commonwealth Chief Investment Officer Adam Fisher said. Blackhall CEO Ryan Millsap said he will continue to hold a minority interest in Blackhall Studios' real estate.

Millsap retains the rights to the Blackhall name and will stay on as a consultant to Commonwealth. Millsap's team also will continue to lease and operate the property, Millsap and Fisher said.

This is Commonwealth's first venture into studio ownership, but not its first attempt at buying an established production campus, having bid on another California studio in the past. 

“We have looked at this space pretty carefully for a few years now,” Fisher said.

While the capital raised for this purchase was in-house money from Commonwealth, Fisher said, it will potentially look to raise upward of $300M from outside investors to develop other facilities.

“That is an issue that we at the moment haven't really decided exactly what it is we're going to do,” he said.

Fisher said he was attracted to the studio business because of the surge in demand and productions for streaming entertainment. The global streaming market size was valued at $50B at the end of 2020, according to Grand View Research. It is expected to reach nearly $224B by 2028.

Major studios also are choosing to film more in studios and soundstages than on location to save on production costs, Fisher said. 

“The large streaming services, they need studio lots. We just see that trend continuing,” he said.

Commonwealth will now spearhead Blackhall's expansion plans in Atlanta and globally, growing from its current 850K SF across nine stages to 130 soundstages and 3M SF, including offices and warehouses.

Blackhall's Atlanta campus opened in 2017 and has since been host to a number of major studios, including Disney, Sony and Warner Bros. It has been the site for the filming of recent blockbusters like Godzilla: King of the Monsters, Venom and Doctor Sleep. The campus spans 100 acres, and Commonwealth also acquired 155 undeveloped acres around what has already been built.

Also as part of the deal, Commonwealth secured more than 50 acres at the Thames Valley Science Park in Shinfield, England. There, Commonwealth entered into a 199-year ground lease with the University of Reading with plans to develop a more than $200M media campus. Commonwealth also acquired 93 acres in Santa Clarita, California, where it could develop 1M SF. A Commonwealth spokesperson said the firm is pursuing several other opportunities in the UK, Europe and Canada as well.

Millsap said he remains in control of 40 acres he acquired in a land swap deal with DeKalb County in February that could also be used for Blackhall's expansion. 

Ultimately, Fisher said Commonwealth will operate all the facilities as a single studio system network.

“The entire platform is going to operate under one owner and management team,” he said.

The sale frees up Millsap to pursue a new venture: launching his own film production company and a content streaming platform called Blackhall Black Ops, based in Georgia, that will focus on action films. Millsap said he is in talks with various local investors to raise $250M for the endeavor. 

Millsap said the production company would look to make military-style movies in the vein of Black Hawk Down or action flicks similar to John Wick “and everything in between. If it has drama that escalates into violence, we'll take it.”

The goal, Millsap said, is to establish another major content-producing studio in Atlanta along with Tyler Perry Studios. Millsap declined to identify any potential investors.

“There is a lot of desire to be making stuff in Georgia [that] is funded by Georgia capital,” he said.

Blackhall's streaming service is slated to debut in 2023, in time to feature the first unnamed movie that Millsap said will go into production next January. 

Fisher said he sees Georgia as having established an industry with a strong infrastructure and lots of talent that will make it a preeminent filming destination.

“Atlanta has become a world-class city with an enormous depth of talent. It has really created a virtuous cycle for itself, which I believe puts it permanently in the top tier of filming locations,” he said. “Other jurisdictions have tried to enter that top tier and try to sort of stay there. In our judgment, it appears that Atlanta has been able to do that.”