A suburban Chicago investment firm tied to billionaire Steve Sarowitz is moving forward on plans for an entertainment-focused development in Los Angeles despite an overall slowdown in production in the world's entertainment capital.
Entities related to Highland Park, Illinois-based 4S Bay Partners filed plans with the city of Los Angeles to build five movie production buildings totaling roughly 257,000 square feet at 3701 Stocker St. near the Baldwin Hills Crenshaw Plaza mall. 4S Bay Partners lists Sarowitz, who founded payroll services firm Paylocity in 1997, as a partner in the Illinois firm. He has an estimated net worth of $2.3 billion, according to Forbes.
The investor paid $24 million for the 2-acre property — which currently holds a 1950s-era office building — in February 2021. The following month it announced plans to convert the site along with other nearby properties it had purchased into an entertainment-related development. A 4S Bay Partners representative didn't respond to a request to comment from CoStar News.
The location is in a historically Black neighborhood roughly 6 miles south of Hollywood; 4S Bay Partners said in 2021 that its project aimed to serve "as a center of creativity and innovation for the Black community," according to a statement. The developer also said it wanted to create economic opportunities for diverse and female filmmakers, creative arts workers and community nonprofits.
The company's more recent move to file plans for the motion picture production campus comes after a notable pullback in demand.
On-location filming fell roughly 36% year over year in Los Angeles in the fourth quarter and was down roughly 32% overall in 2023 compared with the prior year, according to FilmLA. The production decline is largely a result of the Hollywood strikes in 2023.
There were nearly 50,000 job losses in the film and television industry, according to data from the U.S. Bureau of Labor Statistics. Streaming companies are continuing their pullback, with Amazon Prime and Netflix cutting jobs in recent months.
FilmLA President Paul Audley said in a statement it will take months before the region knows what the "new normal" for filming looks like in greater Los Angeles.
“History offers no point of comparison to the present,” Audley said in the statement. “The pandemic year aside, we have to look very far back — farther back than permit records allow — to find a time when production levels stayed so low, for so long.”