🧠 Food for thought

Implications, context, and why it matters.

The studio’s financing structure left it exposed to rate hikes

• The property used a floating-rate loan, so interest costs could climb with benchmark rates and left it exposed when rates started rising in 2022 1.
• As of June 30, 2024, the studio’s revenue covered about 21% of debt service costs, a sign of strain before the default and handback process 2.
• Hackman told investors debt talks were slowed by a dispute involving The MBS Group, a studio management company affiliated with Hackman that still managed many Hackman properties including Radford 3.

A flight to quality is splitting the studio real estate market

• The Radford default adds to a split in Los Angeles, where average studio occupancy was 63% in 2024 and 62% in the first half of 2025 4.
• Owners with stronger assets are doing better, with Warner Bros. Discovery reporting occupancy up to 91% across its Burbank soundstages in 2025 5.
• That gap is widening even as new studio space arrives, with facilities set to open in early 2026 despite high vacancy 6.
• For Netflix, buying an older distressed studio could be a cheaper way to bring more production space in-house than leasing from top-tier operators 7.