04/29/2026
JK Muller Studios (Worldwide)+
Skywood (China)
Global Leader in Film Studio Development, Operations & Advisory Services
Another stark reminder of the prolonged production slump reshaping Hollywood’s infrastructure.
Today, Quixote Studios — acquired by Hudson Pacific Properties in 2022 for $360 million — announced it is shuttering its Atlanta-based production services business and winding down most of its soundstage operations in Los Angeles. Approximately 70 team members in Atlanta and L.A. will be affected by layoffs.
Hudson Pacific has already written down the entire value of the Quixote unit due to sustained operating losses. While their core Sunset Studios portfolio remains strong at 96% leased, Quixote’s leased facilities (including West Hollywood, Pacoima, and Panorama City) operated at just 53.3% occupancy last year. The company will retain its Atwater Village/Griffith Park location and expects annual cost savings of $21–27 million.
This contraction reflects broader market realities: L.A. soundstage occupancy has hovered around 62% in recent reports — well below the 90%+ levels seen in the pre-2023 boom years. Excess capacity, cautious content spending, and shifting production incentives continue to pressure secondary and leased studio assets.
At JK Muller Studios, we have long advised studio owners, REITs, and production companies on portfolio optimization, adaptive reuse strategies, and resilient operational models in volatile cycles. When markets correct, disciplined capital allocation and a laser focus on high-occupancy, strategically located assets separate the survivors from the casualties.
The industry is not disappearing — it is consolidating and evolving. Those who treat studio development and operations as a real business (not just a real estate play) will emerge stronger.
We continue to support our clients with clear-eyed advisory on studio acquisitions, lease restructurings, operational turnarounds, and long-term capacity planning.
What are your thoughts on this latest development? Is this the bottom, or do we expect further consolidation in 2026–2027?