The film and TV industry is a dynamic landscape, and the latest trends reveal a fascinating shift in production spending and activity across the United States. While some states have seen a decline, others are experiencing a surge in investment, with New York and New Jersey emerging as key players in the race to attract Hollywood's attention.
New York, in particular, has seen a remarkable resurgence. The Empire State's incentives have been a game-changer, removing the cap on above-the-line qualified spending and fueling a 19% increase in filming count and a 57% surge in total production spend to nearly $1.06 billion in the second quarter of this year, according to ProdPro. This is a significant turnaround, especially considering the state's investment in soundstage space, with the Tri-State area's inventory growing 43% since 2020. The opening of Sunset Pier 94 Studios and the principal photography of titles like Paramount's 'A Quiet Place III' in the city are testament to this resurgence.
New Jersey, on the other hand, has seen a decline in total filming activity but a major increase in production spend to $387 million for the quarter. This discrepancy is attributed to a dip in feature film starts but a rise in episodic TV filming. The state has formally designated Netflix, Paramount, and Lionsgate as studio partners, conferring a series of incentives to those companies over the long haul. Netflix is building its East coast soundstage base at the former site of Fort Monmouth, while Paramount signed a 10-year lease in October to occupy the in-development 1888 Studios in Bayonne.
However, it's not just the East coast that's seeing a surge. California, the traditional powerhouse, has also upped the ante with a doubled incentive program that appears to be working. The Golden State stayed No. 1 overall with $1.33 billion in production spend, a 5% increase year-over-year, as filming count grew by 11%. This bucked declining filming activity as recently as the first quarter of this year, and the state is also seeing a rise in committed spend, defined as estimated production budget for projects that start shooting in the quarter.
On the other side of the equation, states that had been on the upswing as far as production spending and activity only a few years ago have seen dips this quarter, including in Georgia, New Mexico, and Illinois. Notably, Georgia, which was once a base for Marvel projects, saw a 40% decline in filming activity and a 43% decline in production spend in the quarter. The state had slipped below New Jersey in the fourth quarter of last year in terms of total spend, and the states are now within $20 million of each other in spend.
So, what's driving these shifts? In my opinion, it's a combination of factors. Incentives are just one part of the equation; experienced crews, infrastructure, great locations, and a place where talent wants to work are also crucial. However, when productions are choosing between otherwise comparable markets, the incentive often becomes the deciding factor. The most competitive incentive programs offer a meaningful credit, enough funding that producers know they'll actually get it, credits that are easy to monetize, a fast path to payment, and consistency from year to year. This reduces risk and makes a program more competitive.
What makes this particularly fascinating is the dynamic nature of the film and TV industry. The competition for production spending is intense, and states are constantly upping their game to attract Hollywood's attention. This raises a deeper question: how will the industry evolve in the coming years, and what will it take for states to stay ahead of the curve? One thing is certain: the game is far from over, and the race to attract production spending is far from settled.
