Hudson Pacific expands studio business with $360m acquisition

Hudson Pacific expands studio business with 360m acquisition

Hudson Pacific Properties has expanded its studio business with the acquisition of Quixote Studios, a provider of sound stages and production services to the entertainment industry, for $360 million.

Quixote rents sound stages, cast trailers, trucks, grip and lighting and other equipment essential for content production.

Quixote is one of the industry’s most recognized brands. Its largest clients include ABC/Disney, HBO, Sony, Paramount, NBC Universal and Warner Bros. as well as numerous blockbuster movies and hit television shows such as Apple’s The Morning Show, Paramount’s Yellowstone, HBO’s Curb Your Enthusiasm and Insecure, Disney’s Jungle Cruise and Marvel’s Avengers: Infinity War.

Since its inception in 1995, Quixote has grown its business significantly in Los Angeles, New York, Atlanta and New Orleans while building a culture based on service and innovation.

Quixote has 325 employees, over 500 cast trailers, trucks and specialized vehicles, one of the industry’s largest inventories of grip and lighting and production equipment, as well as long-term lease rights at attractive rental rates to 23 sound stages in Los Angeles and three in New Orleans.

“Our acquisition of Quixote Studios represents further execution of our strategy to enhance our core studio business for customers with a full-service offering of sound stages, both in terms of size and location, and production services in key global markets,” said Jeff Stotland, Executive Vice President of Global Studios and Services for Hudson Pacific.

“Quixote strengthens our reach to capture strong secular demand for studio and related assets, including excess demand at our Sunset Studios locations, and enables us to achieve immediate economies of scale while further diversifying our client base,” he added.

Mikel Elliott, Founder of Quixote, who will remain in a leadership position, commented, “Hudson Pacific and Quixote’s shared purpose is to elevate the production experience for crews on our collective stages as well as on location in the major global production markets. Together, we will further innovate, inspire and solve new production challenges in the era of streaming content and beyond.”

Hudson Pacific financed the acquisition with $200 million of borrowings from its credit facility plus $160 million deferred purchase price accruing interest at a 5% rate interest only, due December 2023, which is secured by substantially all the assets of and equity interests in the acquired business.