Los Angeles Soundstages Stay One-Third Empty as Slump Continues

Why It Matters

Sustained low utilization threatens cash flow for independent studio owners and REITs, while the oversupply could pressure rental rates across the market. The outcome will shape Los Angeles’ competitiveness against emerging production hubs offering richer incentives.

Key Takeaways

• LA soundstage occupancy steady at 62% in H1 2025
• New studios added 11 stages, increasing oversupply risk
• Warner Bros. Discovery maintains 91% occupancy, outpacing peers
• Independent landlord defaults on $1.1B mortgage, property for sale
• Expanded tax credits aim to lift productions, effects lag

Pulse Analysis

The Los Angeles soundstage market, once the global benchmark with utilization rates hovering near 90% between 2016 and 2022, has settled into a prolonged downturn. FilmLA’s latest report shows average occupancy at 62% for the first half of 2025, a figure that has barely moved since 2024 and sits well below the 69% peak recorded during the 2023 strikes. The decline reflects a confluence of factors: the ‘Great Netflix Correction,’ tighter studio budgets, and aggressive incentive packages from competing hubs in the United Kingdom, New York, and other tax‑friendly jurisdictions.

Paradoxically, the supply side continues to expand. Early 2026 saw the launch of East End Studios’ five‑stage Mission Campus and Cinespace Studios’ six‑stage, 180,000‑square‑foot campus in Woodland Hills, adding eleven modern stages to an already crowded inventory. This influx pressures occupancy metrics, especially for independent landlords and REITs. Hackman Capital Partners’ default on a $1.1 billion mortgage tied to the historic Radford Studio Center underscores the financial strain, while Hudson Pacific Properties reports mixed occupancy across its portfolio. In response, California has broadened its film and television tax credit program, introducing a Soundstage Filming Tax Credit that targets new or upgraded stages, yet the first wave of projects has yet to commence filming.

Looking ahead, the market’s trajectory hinges on production volume and the effectiveness of fiscal incentives. Vertically integrated studios such as Warner Bros. Discovery, which posted 91% occupancy on its Burbank stages, benefit from captive pipelines and can absorb excess capacity, whereas independent operators must either secure premium content or consider asset sales. If the expanded tax credits translate into a steady stream of feature films and scripted series, utilization could climb toward pre‑pandemic levels by late 2026. Until then, Los Angeles faces a delicate balance between maintaining its status as the premier production hub and ceding ground to emerging international competitors.