Raleigh Studios - Pontiac movie studio launches with high-profile party

[muskie1]

I do hope it is not another Unity mess, I saw that big carnival party they had. One of the things I had heard mentioned during a interview with the state head of this program was that because there were no local organized unions for these skills not many local people are hired for the jobs. Your choice after recieving training in this field was to head west,get your union card and hope to maybe get picked up for some projects here. Do not know how accurate that is but I just see taxpayers being stuck with more bills and not too many real jobs.

[Packman41]

I do hope it is not another Unity mess .....but I just see taxpayers being stuck with more bills and not too many real jobs.

Agreed. I too hope the taxpayers will not get stuck with more bills.

The financing of the project concerns me – the developers have very little “skin-in-the-game.” They are using a lot of OPM [[other people’s money) mostly taxpayer funded to pull this off.

See this article from the January 10 edition of Crain’s:
http://www.crainsdetroit.com/article/20100131/SUB01/100129812

Uses:
Developer’s Cost to build: $60.0 million

Sources:
Bond: Oakland County EDC: $28.0 million
City of Pontiac Recovery/Reinvestment: $ 3.8 million
MI Film Infrastructure Tax Credits: $11.1 million
Federal New Market Tax Credits: $15.1 million
Subtotal: $58.0 million

That leaves only $2.0 million or 3.3% “equity” in the project and nearly 97% of OPM supporting the deal.

If this deal goes south, then the State of Michigan Employees Retirement System is guaranteeing $18.0 million of the OCEDC Bond and would have to pay that out.

Remember, there is a 368,000 square foot office building attached to this project and that is a lot of space to fill. Not only do the developers have to lease out a lot of studio time they also have to lease out a lot of office space too in order for this to succeed. I am taking a wait and see approach.