Massive San Marcos film and production studio on track to break ground later this year

Documents filed with San Marcos City Council show the layout of the proposed Hill County Studios project.
Provided By Hill Country Studios

Austin American-Statesman
Kara Carlson, Austin American-Statesman
September 8, 2023

A massive $267 million studio for film and television production is expected to break ground in San Marcos later this year after winning city approvals last month.

Hill Country Studios, a subsidiary of Hill Country Group LLC, first proposed the project — which will be a state-of-the-art TV, film and streaming studio — last year. At the time, the company said the project would be the largest of its kind in the state, and it has garnered city and county incentive deals that could be worth more than $6 million.

Hill Country Studios, which was founded in 2020 by Cory McLoud and Zach Price of Hill Country Group, will focus on virtual production, a type of emerging technology that allows film to be made in a digital environment using technologies such as computer-generated imagery and augmented reality before it goes to a physical set. Last year, the company said virtual production design and management would be led by film technology company Vision.

Jacob Cowan, chief marketing officer of Hill Country Studios, told the American-Statesman the project is expected to break ground by the end of the year. He also said films could be made at the studio as early as 2024 as facilities come online, with some construction continuing through 2025.

Cowan said the approvals were “key milestones” in the project’s roadmap as the company moves towards groundbreaking.

An artist's rendering shows what the planned film, TV and streaming production studio in San Marcos could look like.  Hill Country Studio's plans include 820,000 square feet of production offices, comercial space, four workshops, back lots and 12 sound stages.
Provided By Hill Country Studios

In August, the San Marcos Council annexed the land, which is located near the Edwards Aquifer Recharge Zone and rezoned the property to "less intense" zoning classifications. The project will be built on the existing La Cima development near West Centerpoint Road, West Wonder World Drive and RM 12.

The approval followed a July City Council meeting during which the annexation and rezoning were discussed in two items. One item called for rezoning 90 acres to a "Community Commercial District," which would allow it to be used specifically for a film studio. The second called for rezoning 58 acres to a character district, which is designed to preserve open space, according to a San Marcos staff presentation on the change.

At the meeting, Council Member Mark Gleason said he was glad to see the project moving forward, after receiving questions about the project's timing. Mayor Jane Hughson added the project brings "something different for many other people to participate, work and etc." compared with existing advanced manufacturing in the city.

At the same meeting, La Cima developer Eric Willis said he is committed to community outreach on the project and hasn’t heard any feedback that would change the project's direction.

Lisa Marie Coppoletta, a local professor, also spoke in support of the project, saying Hill Country Studios is committed to the community and could compete with other nearby film projects. She said it’s important to stay on the “cutting edge,” and said the studio's virtual film focus means it's a cleaner industry. She also said it could bring internship opportunities to local students.

What incentives has the project received?

The approvals come after the San Marcos City Council last year authorized a Chapter 380 tax abatement agreement following a lengthy discussion that raised environmental concerns, and that included talk of the economic benefits and potential partnerships with Texas State University and the San Marcos school district.

Under the agreement, the studio will receive an estimated $4.6 million in property tax rebates over five years, with abatements decreasing year by year starting with a 90% rebate once the studio is built and ending with a 20% rebate in the fifth year. The deal would go into effect in 2025, but before that the city would collect $2.1 million property taxes and estimated it would get $11.4 million in property tax revenue for the project over 10 years.

Last year, Hays County commissioners also approved a separate incentive agreement for the project that granted property tax abatements worth about $1.6 million over five years, starting in 2025.

Both agreements require the company to meet certain performance obligations, including purchasing the land and constructing the studio, as well as obligations related to jobs and business operations.

What will the project include?

Plans on the company’s website show the project would be built on 75 acres of a 209-acre property, and include 820,000 square feet of production offices, commercial space, four workshops, back lots and 12 sound stages.

The website also said the property will have a food lot with local food trucks and vendors. The website also mentions a vendor village with onsite services to aid production.

The website shows Hill Country Studios plans to build the project in two stages, starting with seven studios and two workshops. The second phase would add five studios, two workshops and an additional unlabeled building. Original plans filed with the city last year called for an earlier groundbreaking in April 2023 and three phases.

The website also mentions a production office with more than 200,000 square feet, flexible configurations for small and large productions, two concrete pads that are 2 acres, and a backlot for outdoor filming space in a variety of environments.

Documents filed with the city last year show the studio expects it would employ 22 people full time with an average salary of $100,000, a number that could grow to 44 full-time employees once fully built. The filings also estimated the studio could employ up to 1,400 contract workers, averaging about 1,200 workers on production projects, with an average salary around $80,000.

Similarly, Cowan estimated projects filming at the studio could provide about 1,200 contract employee jobs once the project is in full operation.