The ambitious plans for a massive movie studio complex in Effingham County are now on the cutting room floor.
Effingham Industrial Development Authority members have approved and received a termination agreement with Moon River Studios, which had been planning on building movie studios on 1,560 acres off Interstate 16 and Old River Road.
The bond termination reverts control of the entire tract back to the IDA.
“This is something our board had drafted and approved several months ago,” IDA CEO John Henry said. “This is something we’ve been working for a while.”
IDA members were presented Thursday night with copies of the termination agreement signed by FONU2 CEO Roger Miguel.
“The Moon River project had somewhat of a disappointing end,” Henry said. “The project was very ambitious from the very beginning.”
Once designed to occupy the entire 1,560 acres of the tract, Moon River Studios officials sought and got a revised agreement that reduced the scale of the project to 51 acres. The IDA agreed to build an entrance road into the property from Old River Road.
A reworked agreement between the studio and the IDA led to the IDA taking on building the entrance road to the property from Old River Road. The 3,000-foot road is expected to be completed this summer. The road will cost $1.5 million, and the IDA is saving $130,000 because of engineering work the studio performed before the IDA took over the road construction.
Under the terms of the termination agreement, the studios will not receive $300 million in bonds. Its lease on the property also is terminated and the option and economic development agreements also are ended. The studio also is responsible for all costs with the bond termination agreement, potentially including attorney’s fees.
Even with the end of the studioplex plans, the IDA will continue to build the entrance road into the tract and market the site to potential users.
“We will continue to focus on marketability of the site in order to create jobs, bring new capital investment and expand the tax digest in Effingham County,” Henry said. “It is and has been an attractive piece of property for development. We should have no problem finding users for the site.”
The termination agreement , signed April 4 by FONU2 CEO Roger Miguel, also means the studio cedes all rights to the property, and it reverts to the IDA’s control.
“We will continue to work with prospects on the site to find the best use and best project,” Henry said. “We will rely on our strategic plan and our capital improvement planning process to determine what we will plan next for the property.”
What was then Medient Studios and the Effingham IDA entered into a memorandum of understanding in March 2013, after the company searched sites in several states and nations. A lease agreement was signed in July 2013, and the studio had grandiose plans for studios, DVD and video game production, hotels, shopping, on-site housing for the workforce, an amphitheater known as the Leafr and a glass bridge
Along with $1.25 million in cash rebates for site improvements, the project also was targeted to receive a $3 million grant from the state for economic development if it reached its employment objectives. It also was eligible for a $5,000 tax credit per job created per year for the five years.
Once the initial lease payments were completed, the studio could purchase the entire property for $100.
The original Medient development schedule called for the first studios to be done by November 2014 and the final phase of construction, aside from landscaping, to be completed by September 2016. w
But in June 2014, then Medient CEO Manu Kumaran was ousted after board members expressed their displeasure with a lack of progress. Along with the change in leadership, the amphitheater, bridge and on-site housing were removed from the plans but the second master plan had areas for shopping and recreational facilities and less elaborate 20,000-seat amphitheater, along with studio offices, warehouses, soundstages and back lots for movie production.
Under the original terms, the IDA was to receive $10 million and with the 20-year lease, it was going to provide $1.25 million for site development. The initial projection was for the studioplex to create 1,200 jobs by the end of the first phase.
The studio was obligated to create $90 million in investment and 527 jobs within the first five years.
FONU2 acquired Moon River Studios, the new name for Medient, and its lease in February 2015.
In October, the IDA and the studios’ parent company FONU2 announced a revised lease agreement that reduced the company’s annual lease payments from $555,000 a year to $51,000 a year, to go with the less amount of property the studios planned to occupy.
Moon River’s capital investment requirement also was slashed from $90 million to $10 million over a five-year period, and the plan called for 10 stages, four warehouses, support buildings and offices to be built in the first phase. It also reduced the number of full-time jobs to be created within five years to 250.
Moon River brought on board Hussey, Gay and Bell as its engineers and Foley Design Associates Architects for the studioplex project.
Moon River remains in operation and will continue to keep its offices off Goshen Road Extension. The studio currently is working the movie “Mara,” filming on locations in and around Savannah.