Netflix has struck a deal to set up a permanent production base at Shepperton Studios, home to films from Alien to Mary Poppins Returns, as the company plans to spend more of its $13bn (£10.3bn) annual production budget in the UK.
The US streaming service made more than 40 productions in the UK last year, including The Crown, Sex Education and Outlaw King, and has been searching for a long lease for an exclusive hub to ensure the boom in demand for studio space doesn’t hinder its plans to make TV shows and films without delays.
The deal guarantees Netflix exclusive access to most of the facilities at Shepperton’s west London studios, including its 14 sound stages, from October.
Paul Golding, the chief executive of Shepperton’s parent Pinewood, home to the James Bond and Star Wars franchises, said that the deal represented a huge boost to the UK’s status as a major destination for film and TV production.
“Netflix’s decision is a real vote of confidence in the UK film and TV industry,” he said. “It is all about confidence in the UK as a location for top quality productions.”
Netflix has significantly increased its European production slate this year, with 221 projects, including 153 originals with a budget of well over $1bn. This is a more than 50% increase over 2018’s slate.
Previous reports suggested Netflix was lining up a long lease deal at Pinewood Studios. However, according to sources this was always unlikely because of the politics of rival Disney already having a long term deal in place at Pinewood until 2029.
Disney has pulled all its content, which includes the Marvel superhero universe, the Star Wars films and Pixar’s Toy Story franchise, from Netflix in the US before the launch of its streaming service, Disney+ later this year.
Details of the deal with Shepperton are unclear but it is likely that Netflix has struck at least a 10-year agreement, the same length of time Disney is thought to have at Pinewood.
Earlier this year, Pinewood gained planning permission for a £500m expansion of Shepperton, which will make it the second-largest studio in the world. The existing Shepperton site will be expanded five-fold and will include 16 new sound stages due to open from 2021.
Golding said that Netflix’s takeover of all of Shepperton’s current stage capacity would not mean the US giant would be muscling out other British and foreign companies that currently use the site.
He said that the 165,000 square feet of stage space Netflix is taking would be offset by the opening of six new sound stages, about 130,000 square feet, at Pinewood starting in October.
“It is not like Netflix is going to be dislodging all our other customers,” said Golding. “The new sound stages will enable us to have sufficient space for all our customers. We will speak to Netflix [about using the new space], but also to everyone else, small and large productions.”
Netflix indicated its frustrations at the constraints on UK studio space in a submission in support of Shepperton’s expansion last year, which said: “In 2018, Netflix plans to spend approximately $8bn on content worldwide, across more than 700 television and film productions. We would like to be able to produce more in the UK. However, we are limited by the lack of available space.”
Netflix’s first original production at Shepperton will be The Old Guard, starring Charlize Theron, an action-drama based on the comic book series from Greg Rucka and Leandro Fernández.
Last July, Netflix opened its first European production hub at a new 22,000 sq metre campus called Ciudad de la Tele (TV City) in Madrid.
Pinewood bought Shepperton Studios, which dates back to 1932 and has been home to film favourites from Blade Runner to Top Gun, in 2001 for £35m.