Addleshaw Goddard (AG) has advised Aviva Investors on a long-term agreement for US streaming giant Netflix to occupy and significantly expand its Longcross Studios complex in Surrey.
The partnership, which will see Netflix take a long-term lease at the site, is expected to significantly increase the breadth and calibre of production facilities at what is already one of the country’s leading film production complexes, furthering the UK’s status as a leading global centre for the cinema industry.
AG also advised Aviva Investors on the acquisition of the remaining stake in Longcross Studios for £45m from housebuilder Crest Nicholson. The site was previously owned by both parties in a joint-venture partnership.
Longross Film Studios, which has four main stages, has been used to produce a number of major global blockbuster films including the James Bond franchise, films from the Marvel Cinematic Universe, the Star Wars series and Mission:Impossible 7.
The acquisition is the latest in a string of deals AG has worked on within the TV and film real estate sub-sector. In May, AG advised Location Collective on the development of OMA:X Film Studios, a new 224,000 sq ft production facility in Enfield. This followed AG advising Channel 4 on the lease of its new 27,000 sq ft national HQ in Leeds which opened this year.
AG advised Aviva Investors on all property, planning, construction, tax and corporate structuring elements of the transactions. The team was led by Ian Smith, Partner (real estate), with support from Katherine Medcalf, Managing Associate (real estate); Sally Cowley, Managing Associate (real estate); Amanda Davis, Legal Director (real estate), Hayley Maxwell, Associate (real estate); Lee Sheldon, Partner (corporate structuring); Liam Diggins, Legal Director (corporate structuring); Dhaksha Giga, Associate (corporate structuring); Gary Sector, Partner (Planning), Mark Broomfield, Legal Director (construction); and Michael Hunter, Partner (tax).
Aviva Investors was also advised by JLL, TFT Consultants and Delta Simons.
Ian Smith, Real Estate Partner at Addleshaw Goddard, said:
"The UK television and film industry is booming, driven in large part by a favourable tax set up and a widely-held belief that the country is home to some of the world's best production talent. This of course has created a lot of demand for dedicated studio facilities, leading to massive investment in the forward-funding of new units, warehouse conversions and the acquisition of existing sites.
"It was a pleasure to work with Aviva on this deal. Longcross provides a huge range of production facilities, so is an appropriate filming location for big-budget movies and television shows. The investment will help to drive economic growth in the wake of Covid-19 and create valuable jobs for those working within the film and TV industry."
James Stevens, Head of Development, Global Real Estate, at Aviva Investors, said:
“We are very pleased, not only to increase our investment in Longcross and the UK’s creative industry, but also to grow our relationship with Netflix and bring a world-leading business to the region and further our strategy of actively targeting unique opportunities in this sector. It is exciting to see such a large global brand and pioneer in the digital entertainment industry demonstrate a strong, long-term commitment. We are confident that Netflix’s presence at Longcross will further cement it as a leading studio and create a truly world-class production centre for the British film industry. Moreover, this project will increase the depth and breadth of local employment opportunities, whilst also creating value for the UK pension schemes that make up a large proportion of our investor base.”
Anna Mallett, Vice President, Physical Production, EMEA/UK, at Netflix, commented:
“We are delighted to announce the expansion of our production presence in the UK. The new lease at Longcross highlights our commitment to investing in the UK creative industry and will provide a wealth of opportunities and production jobs, from entry level to heads of department. We’re excited to work with some of the best storytellers in the business to create amazing new films and series for our members.”