Box Office Gains, War Fear Spurring Local Productions

By DARRELL SATZMAN

Staff Reporter

While other industries sputter under the weight of the sluggish national economy or hold back spending in anticipation of a possible war with Iraq, Hollywood is humming along at a decent clip.

Many studios are fully booked and a sampling of local production workers say they are as busy as they have been in the past 18 months.

Los Angeles County location filming in January was up 7.8 percent over a year ago, according to the Entertainment Industry Development Corp., which issues film permits for local shooting. The level of location feature filmmaking doubled in January compared to a year earlier.

Still, enthusiasm over the increase is tempered by tepid production levels in 2002, which were slow to recover from the combined disruptions of the Sept. 11, 2001 terror attacks and a production hangover that followed a surge in work after anticipated strikes by actors and writers failed to materialize.

This increase in activity, while not at the levels of the early 1990s, augurs a return to more appropriate levels, say many in the industry.

“Right now the industry is hopping and it all starts in Los Angeles,” said James Thompson, president of Real to Reel Location Agency, in Van Nuys. “After the events of 9/11 and the strikes it was very slow, but with the box office setting record numbers, all the studios are trying to get product out there.”

Positive trends

Last year’s $9.31 billion domestic box office take was an 11.5 percent increase over 2001. Just as importantly, theater attendance has increased for the past two years after several years of decline, said Paul Dergarabedian of Exhibitor Relations.

“We hadn’t had a 10 percent jump in revenues for at least 10 years,” Dergarabedian said. “If there’s a war, people will be looking for escapism without leaving the country or without going too far from home. The local cineplex provides that.”

And as the public stays closer to home in uncertain times, so do the people who make movies. How big an impact that has on local production levels is unclear only top stars and big-name directors have the influence to make such demands.

Other considerations make local filmmaking more attractive during wartime, including added travel costs and increased security hassles. Combine that with a strong inclination by people to be close to their families during war, and producers are likely to go to greater lengths to make working in Los Angeles pencil out.

“The films that would have been overseas because of incentives or currency savings might be filmed differently to save money, with a different cast,” said Dave Davis, a senior vice president at investment banker Houlihan Lokey Howard & Zukin. “War has always been a boon for the box office, so you figure you can make it up on the other side.”

Davis said the collapse of the German stock exchange for new and fast growing companies, the Neuer Markt, and with it dozens of German production companies, has led to a reduction in the amount of films being made overseas. Some of the gap is being made up locally, he said.

There is other evidence that things are picking up.

Of the 60 American films currently in production, according to the Hollywood Reporter, 31 are being made at least partly in Los Angeles, a somewhat higher percentage than normal. Moreover, of the 21 major studio films in production, 14 are being shot in part, if not completely, in Los Angeles.

“The war is on people’s minds,” said Karen Constine, director of the California Film Commission. “In some meetings I have had with producers they say a war with Iraq would impact production decisions. They would look to shoot closer to home.”

Calls seeking comment from Walt Disney Co., Universal and Columbia TriStar were not returned.

Television and commercials

On the television side, location production levels in January actually fell 10 percent from last year, reversing a six-month upward trend that saw TV production nearly double.

Kathleen Milnes, vice president of the EIDC, cautioned against reading too much into the recent production gains, but said local officials are cautiously optimistic about the year ahead.

“One thing you’re seeing in television is a proliferation of outlets for product,” Milnes said. “There’s a lot more stations and a lot more air time to fill.”

When Warner Bros. abruptly changed its mind about filming a portion of its as-yet-untitled “Superman” mega-feature at Los Angeles Center Studios, Christopher Ursitti didn’t panic because it provided him a chance to get in on the upcoming television season.

“There’s a busy-ness that wasn’t here last year,” said Ursitti, co-owner of the downtown Los Angeles production facility, noting that he’s well on his way to filling the space that had been set aside for “Superman.”

After a dismal two years for commercial production in Los Angeles following the six-month strike by actors against advertising agencies that ended in 2001, levels last year remained fairly constant, though still down from before the strike.

Steve Caplan, senior vice president of the locally based Association of Independent Commercial Producers, said despite that constancy for commercial production, hit harder by runaway production than perhaps any other segment of the industry, there is no upside to the prospect of war.

“On one hand it might have an impact on local production because people don’t want to travel,” Caplan said. “But there’s a lot of speculation that advertisers are holding back. And they’ll probably be holding back more if there is a war.”

And not everyone is convinced that things have rebounded for local production workers.

Earl Brendlinger, business manager for the Studio Utility Employees Local 724, which represents 1,150 local set construction workers, said there’s been little consistency in the amount of projects over the past few months.

“I went from 75 members out of work in the first week of February to 150 now,” Brendlinger said. “I’ve had very few work calls in the past couple of weeks. It doesn’t seem real busy.”

And freelance lighting technician Michael Everett said he’s only worked a few days so far this year, though he has an offer to do work on an upcoming independent feature. “It’s seems like there’s a lot of wishful thinking going on. But I don’t know if it’s gotten busier or not,” Everett said.

But others insist the year is shaping up well, a prospect unlikely to change if the United States does go to war. “We’ve been busy, We’ve got 150 companies a day on the streets,” Milnes said. “There’s a sense things are improving.”

Jack Kyser, chief economist for the Los Angeles County Economic Development Corp., said industry employment in the county is expected to increase by 6,500, to 125,000 in 2003. That’s substantially below 1999’s total of 138,000 workers, but it does indicate a moderate recovery.

“It’s a decent jump,” Kyser said. “If there is a war you are going to see a pullback in overseas production. There’s bound to be lingering hostility over the United States, and American film companies are a very rich target.”