Sound Stages: The Real Estate Asset Winning the Content Creation Boom

Thesis Driven dives deep into emerging themes and real estate operating models by featuring operators executing on each theme. This week’s letter is a guest post from Jake Chai, Managing Partner at Mana Tree, a New York-based developer. It dives deep into sound stages, unique spaces supporting the content creation industry. 

In an era where content is king, sound stages stand as the castles of the entertainment world. These specialized facilities, designed for film, television, and digital production, have become a focal point for real estate investors looking for the next big thing. 

Building sound stages could mean revitalizing underutilized industrial spaces or constructing purpose-built ground-up structures, turning them into artistic production and economic activity hubs. But it’s not for the faint of heart. Demand for sound stages is directly linked to content production volume, which can be quite volatile. The emergence of AI also introduces macro risks and brings the sector's future into question.  

Today's letter will explore the evolution of the sound stage industry, including:

• An overview of significant institutional partnerships;
• Sample economics of a sound stage adaptive reuse project; 
• Industry perspective from a regional power operator, Umbra Stages; 
• Analysis of the data underlying the evolution of supply and demand for sound stages.