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Netflix is looking to make its relationship with Ontario more than a fling. After years of renting studio space in the province, the streamer has now locked up eight soundstages in Toronto — four each at Pinewood Toronto Studios and Cinespace — by taking out long-term leases. The province’s production space race has also seen CBS build a 260,000-square-foot studio in suburban Toronto, while Hulu, Amazon and others line up local stages and crews to generate their own original content. All are taking advantage of generous film tax credit and currency savings, while drawing on world-class creative talent, technicians, suppliers and filming locations. Netflix’s production hub is an all-in bet on the province as a long-term production base, according to Ontario Creates CEO Karen Thorne-Stone, who markets the region to Hollywood producers.
“[Netflix] may not know what their productions will be three or five years out,” she says. “But they know that consumer demand is insatiable as more platforms come online and, based on their experience in Ontario, they’re putting down a real footprint.”
Rewind to September 2018, as top studio and streaming executives were headed to a crunch meeting with Ontario Finance Minister Vic Fedeli at the Toronto Film Festival. They were there to discuss whether Hollywood content makers would continue to fuel Ontario’s production boom despite campaign promises from since-elected provincial leader Doug Ford, brother of late Toronto Mayor Rob Ford, to find billions in budget cuts. In 2015, Ontario’s tax credit was trimmed from 25 percent of all foreign production spending to 21.5 percent, leaving major studios wary that Ford’s cost-cutting talk could result in further reductions. Donna Skelly, an Ontario member of the provincial Parliament, and based in Hamilton, Ontario, also heard that message last year when she held a roundtable in Toronto with execs from studios including Paramount, Disney and NBCUniversal. “They made it very clear back in the fall, despite the fact we have great talent and infrastructure, that the number one issue was the tax credit,” she says. Fedeli insists there’s nothing to worry about as the Progressive Conservative party is focused on supporting and stabilizing the tax credit program.
“We said we’d streamline the administration of the tax credit, reduce red tape and enable the companies to receive their tax credit faster,” he tells The Hollywood Reporter. “That’s what they asked for, and that’s what we’re giving them.” Local production players at the TIFF meeting say Fedeli’s words were well received. “He said, ‘We appreciate our $2 billion industry,'” recalls Cinespace Film Studios vp Jim Mirkopoulos. “He said, ‘We won’t pull the carpet out from under you again.'” Adds Pinewood Toronto Studios chairman Paul Bronfman: “We needed a finance minister who would roll up his sleeves and be proactive. [Fedeli] sees the numbers, the size and growth of this industry, and he’s thrown his support behind us.” Ontario’s promise of tax credit stability and support clearly resonated with Netflix, which in February announced the Toronto production hub.
“Cutting red tape, public infrastructure access and the willingness to find creative solutions to difficult production challenges are very important to us,” a Netflix rep tells THR. “We also appreciated the finance minister’s measures to ensure financial stability.” Meanwhile, Cinespace’s Mirkopoulos in 2018 also placed a call to Netflix after signing a long-term lease with the city of Toronto to retrofit a waterfront cruise ship terminal. “Netflix execs got on a plane last summer, came to see the facility and immediately entered into negotiations,” he remembers. The lakeside studio is set to open this summer.
Bell Media CEO Randy Lennox, whose media group has a majority stake in Pinewood Toronto Studios, recalls taking a call last year from Netflix to ask about his studio expansion plans. “They were very proactive, very early, and made it clear they would like a fairly permanent position as part of Pinewood — and we were all ears,” Lennox says.
As Disney+, Apple, WarnerMedia and NBCUniversal launch their attempted Netflix-killers amid the streaming wars, Ontario is on track for another record-breaking year for foreign location shooting — and local studio operators are set to launch an estimated 1.8 million square feet of new soundstages over the next two years.
“Because studio space is at such a premium, we know we will be running 90 percent capacity from day one,” says Frank Sicoli, founder of First Studio City, which is set to open a 400,000-square-foot film studio in Markham, Ontario, in late 2020. “We’re already talking about building a second Studio City.” Netflix is also spreading the wealth with projects shooting across the region, including I Am the Pretty Thing That Lives in the House (Ottawa), October Faction (Cambridge) and In the Tall Grass (Stratford).
Toronto Mayor John Tory watched the negotiations for the province’s Netflix production hub with keen interest after three years ago first talking to the streamer during a studio visit about sending more of its films and TV series to his city for production. Tory plans to take full advantage of the wave and will travel to L.A. in mid-May to lure more players back to his city. “You don’t have to build your own studio,” he says. “Just make it a hub, like Netflix did, and we’ll make sure there’s the studio space to accommodate you.”
And after northern Ontario got a head start with its rich incentives to entice Los Angeles producers, the rest of the province nearer to the U.S. border is getting in on an expanding production scene. “The exciting news is we’re seeing production travel outside of Toronto. It really shows the strength of our municipal partners. That really helps these projects land well in Ontario communities,” Ontario film commissioner Justin Cutler says.
This story first appeared in The Hollywood Reporter‘s May 16 daily issue at the Cannes Film Festival.
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