Why Spain's Largest Studio Complex Is Set to Be Liquidated
The only bid for Ciudad de la Luz, where tsunami drama 'The Impossible' shot, was presented in a second sales attempt by a group reportedly linked to Francis Ford Coppola, but failed to meet a minimum price requirement.
Valencia’s regional government declared the auction for the Ciudad de la Luz studio complex on Spain’s Mediterranean coast “deserted” this week, forcing the venerable complex to be liquidated.
Ciudad de la Luz, or "City of Light," located near the Spanish port city of Alicante, was the crown jewel in the regional government’s public spending, worth an estimated €500 million ($570 million) investment. When running, it featured state-of-the-art technology, huge soundstages, an enormous lighted backlot and a natural horizon water tank where Juan Antonio Bayona’s tsunami drama The Impossible was shot.
Ridley Scott once called the studio and its setup "the best facilities in the world.”
So, what went wrong?
For one, critics say that Alicante is hundreds of miles from the Spanish film industry’s big centers, Madrid and Barcelona. Even so, the ultra-modern facility, boasting 365 days a year of sunny weather for filming, managed to snag top European shoots like the $100 million Asterix and Obelix at the Olympic Games.
But handsome subsidies from the regional government landed the studio in hot water when European authorities ruled them unfair competition.
The second round of bidding produced only one bid that came in below the minimum price requirement of $53.5 million, half of the $107 million property value set by an appraiser. That left the bid's deposit below the $5.3 million required under the auction guidelines to get an offer studied.
The sole bid came from Cine Space N — a company that was linked in the Spanish media to Francis Ford Coppola — who presented a 44-page document to “start film production activity immediately and get the studio working with new technological capabilities.” Four years ago, Coppola was reportedly involved in Cine Space N via shareholder Juan Antonio Iniesta, who is no longer associated with the company. Even so, Coppola collaborator Fred Fuchs is reportedly still involved in the project and representing Coppola, local media reports said.
The Hollywood Reporter was unable to confirm Coppola's role or involvement.
The first auction, held in 2015, presented the same situation in that a sole bid was presented — by the same company — well below the asking price. The first round did not contemplate any bids under the $107 million asking price. The second round differed in that the minimum bid was cut in half to $53.5 million.
According to reports in the Spanish media, Cine Space N offered only approximately $23 million. The bid also included a proposal to include an international university and research facility, backed by the University of Arkansas.
Justifying the company's low-ball bid as more accurately reflecting what the minimum should be, Cine Space N shareholder Francisco Pastor told Spanish daily El Pais: “We have presented a serious industrial project that requires an important technological investment, but it guarantees the Ciudad de la Luz will remain dedicated to its original purpose.”
Ciudad de la Luz CEO Miguel Mazon said instead of selling the studio way below its property value, he would start the liquidation process, based on the steps outlined by the regional government for the “best possible solution for the complex.”
“If they thought they would win this with one euro, I will fight to my death so that it is not so,” Mazon told the Spanish media. “It’s clear we will have to liquidate the company.”
In 2014, the European Union labeled the regional government’s subsidies of $312 million to the complex unfair competition and forced the sale of the property so as to return the funds.