The massive deal between a film studio and the Effingham Industrial Development Authority appears to be heading toward a groundbreaking later this year.
The IDA approved two agreements between Medient Studio and the state Thursday, one of which will provide a $3 million grant to the company for its Effingham County project.
The IDA and the studio entered into a memorandum of understanding in March, taking the first step in building a $90 million film, DVD and video game production studio, along with a retail and shopping complex closer to Old River Road.
“I think we’re all pretty much in awe,” said IDA member Dick Knowlton. “It’s going to take us a while to really grasp and understand what this means.”
Medient also provided the IDA with a development schedule, which calls for the first phase of construction to start Sept. 9.
Effingham IDA CEO John Henry said they will set up meetings with county officials soon to discuss the intergovernmental agreement that is part of the memorandum of understanding. He said they need to know the water and sewer capacity needed at the project in order to set up the service provisions and responsibilities.
Phase 1 construction, which includes roads, utilities, the suspension bridge, the reception building, the unique leaf structure amphitheater and the main studio, could begin by Sept. 9. The roads, utilities and suspension bridge into the tract have that beginning date. The rest of the first phase includes the reception building, the leaf structure amphitheater and the main studio.
Studio construction is expected to be completed in June 2014, and the leaf structure and utilities are the last items to be finished, according to the schedule, with a completion date of September 2014.
The second phase includes the retail centers, hotel, housing, gaming center and Medient’s corporate offices. Construction on that phase is slated to start in the fall of 2014, with end dates set for mid to late summer in 2015.
“We’re looking at two to three years for completion,” said Manoj Koshy, the head of Medient’s infrastructure group. “We want to be working while at the same time we are developing other areas.”
The first building to be erected will be a reception hall with offices to greet guests, Koshy said. While the leaf structure, covering a 25,000-seat amphitheater, is one of the most noticeable design concepts, Koshy also raved about the corporate headquarters to be built there.
“We want to try to capture a piece of East and West, and make it unique,” he said. “They have put together something that I think is going to be brilliant.”
Koshy also reiterated the company’s plan for a limited impact on the environment, including underground waste management systems and elimination of gasoline vapors on the site.
“The whole project is going to be self-sustaining, with solar panels covering every usable surface,” he said. “We’re going to be using geothermal power.”
Recruitment of the local job force could start as soon as the middle of June, according to the development schedule.
The IDA has agreed to extend the deadline for financial due diligence on the project until May 31, as both Henry and IDA Chairman Dennis Webb are visiting a prospect in China next week. Henry said they are still targeting mid-July as their closing date on the bonds.
Medient’s grant from the state is unique in its format. Rather than money upfront, it will be paid out based on the company’s performance. The state will pay $750,000 for the first 250 jobs created and maintained for 12 months. Another $750,000 will be directed toward the company for the next 250 jobs created and maintained for 12 months. The final $1.5 million will go to Medient for 500 additional jobs created and maintained for another 12 months.
Because the state cannot make the grant to a company directly, the IDA will act as the go-between, receiving the grant and then disbursing it to Medient.
“We act as the conduit,” Henry said.
Manu Kumaran, Medient’s CEO, said the studio has been in talks with a construction partner, an internationally-known firm that specializes in low-cost housing in the Third World.
“But they have some modern techniques they think will adapt well to this,” he said. “We’ll see if they can make our weird shapes come to fruition.”
Kumaran said the company also considered going to Wall Street to raise money for its construction before choosing the option of buying it over time from the builder.
“The financing plan has been very carefully thought out,” he said.
Kumaran also said the project is moving at a pace faster than it would have in other states.
“This is still a relatively fast and painless process,” he said. “I must commend the people of Georgia for creating that environment.”
He also called the state’s grant — the first given for any movie studio project, he added — a “validation.”
“The fact we have secured state support over Pinewood and big names shows that reasonable people have examined our plan in great depth,” Kumaran said.
“Things couldn’t be better.”
