JPMorgan, Canyon co-originate $193m loan for Queens studio project

New York City industrial development agency tax incentives rounded out the financing on East End Studios campus.

Canyon Partners Real Estate and JPMorgan Chase have co-originated a $193 million loan for the ground-up development of a media and content production studio in Queens, New York.

The lending duo originated the July 24 financing on behalf of East End Studios, who will use the capital to create a campus in the Sunnyside neighborhood of Queens. Construction of the studio kicked off with the loan’s closing, and project completion is set for the first quarter of 2025.

In addition to the senior debt, the financing package included tax incentives from the New York City Industrial Development Agency. Pat Swiney Kaufman, commissioner of the mayor’s office of media and entertainment, said the tax credit gives television production projects an incentive to relocate to New York.

East End’s Sunnyside campus will be a 275,000-square-foot Class A facility with three sound stages spanning 75,000 square feet. The project also includes a 15,000-square-foot rooftop flex-stage and outdoor gathering spaces. The campus is located between Queens Boulevard and the Long Island Expressway.

“New York City is one of the largest entertainment markets in the world, with significant unmet demand. Our Sunnyside Campus is going to meet that demand while establishing an elevated standard for modern studio workflows,” said Jonathan Yormak, a founding partner at Glendale, California-based East End Studios.

The Canyon and JPMorgan co-originated financing adds to the ongoing lending momentum seen in the studio space sector over the last five years. Demand for movies, television shows and other digital entertainment content only increased with the onset of the covid-19 pandemic, which further accelerated that trend over the last three years.

Canyon has kept itself active in the commercial real estate debt markets this year especially with dislocation keeping some larger lenders on pause. Robin Potts, chief investment officer at the Dallas-based manager, told Real Estate Capital USA last week that her firm is looking for the best spots in the capital stack to add more value to Canyon’s debt business.

“When you have periods of volatility like this, the equity markets can take a lot longer to adjust than the debt markets. Because the debt markets tend to move first, the opportunities in the debt markets have been incredibly interesting and that is where we have been spending most of our time,” Potts said.

Outside the studio space, JPMorgan has remained an active commercial real estate market participant with financings that include a $150 million refinancing loan for a Massachusetts life science asset in June and a $140 million loan co-originated with Citi Real Estate Funding for a Miami hospitality asset in May.