NSW Government pledges $100 million to build second major film studio in Sydney

The NSW Government has officially launched a search for a site to house Sydney’s second global film studio, backed by a $100 million capital fund designed to address a critical shortage of production space.

While Sydney is currently recognised as Australia’s screen powerhouse, the state’s capacity for large–scale productions has been limited by the fact that only one major hub exists – Disney Studios Australia at Moore Park.

As international demand for local facilities continues to grow, the lack of available sound stages has frequently forced Hollywood productions to look elsewhere. In response, the government has opened an Expression of Interest (EOI) process to partner with the private sector in delivering a world–class facility in Greater Sydney.

The project, which requires a minimum of six sound stages, aims to ensure NSW remains a premier destination for global blockbusters while providing permanent infrastructure to support the long–term growth of the local screen industry.

Why sink $100 million into a new studio?

• Money: The screen industry already injects $1.2 billion into the state economy.
• Jobs: 13,500 people currently work in the sector; a new studio means more local sparkies, set builders, and caterers.
• Bragging Rights: It keeps NSW competitive against other states and international hubs like Vancouver or London.
• The Constraints: The new studio must have at least six sound stages and be located in Greater Sydney (places like Bungarribee or Eastern Creek are on the shortlist).

Global movie expenditure statistics

The 'content war' is expensive. While streaming video-on-demand (SVOD) platforms continue to invest heavily in original content, total media-industry cash content spending grew to approximately US$136.4 billion in 2023, a slower growth rate compared to previous years.

Major streamers, including Netflix, Prime Video, Disney+, Apple TV+, Paramount+, and Max/HBO Max, were projected to invest around US$42 billion in original and acquired film and TV content in 2023.

While the 'Peak TV' era has cooled slightly – with a roughly $6 billion drop in spend since 2022 – the focus has shifted from 'volume at all costs' to 'high–quality franchises' – which will be rewatchable into the future, as opposed to being watched once simply because it is new.

Australia’s slice of this is growing; in 2023–24, international theatrical features shooting in Australia spent over $1 billion, more than doubling the previous year’s performance.

The film industry has changed – who will hire it?

Two decades ago, the 'Big Six' studios – now effectively whittled down to a Big Five – lived and died by the box office, but the rise of Netflix, Disney+, and Amazon has fundamentally dismantled that old order.

We have entered the age of Vertical Integration 2.0, where studios have evolved beyond mere content creators to become the owners of the 'theatre' itself through their own streaming apps and proprietary data.

This shift has facilitated the 'death of the middle', causing mid–budget dramas to vanish from the cinema in favour of streaming platforms, while the big screen is reserved almost exclusively for massive 'tentpole' franchises that are a 'visual rollercoaster' and of course, horror movies – which people enjoy as a shared cinema experience.

Is this worth the spend?

Spending money to lure 'runaway productions' (Hollywood films shooting abroad) is a double–edged sword. It creates a 'race to the bottom' where countries compete on who can give the biggest tax break.

However, building infrastructure (like this $100m studio) is smarter than just giving cash rebates. A rebate vanishes after the credits roll, but a sound stage is a permanent asset that keeps crews employed for decades (hopefully).

NSW vs Queensland

While Sydney scrambles to find floor space for its second major studio, Queensland’s heavyweight champion remains Village Roadshow Studios at Oxenford – effectively the 'Hollywood of the North' conveniently located next to Warner Brothers theme park.

As one of the largest studio lots in the Southern Hemisphere, it boasts nine sound stages and three massive water tanks, making it the premier destination for 'wet' blockbusters like Aquaman and Pirates of the Caribbean.

It is the site where Chris Hemsworth basically moved in for Thor: Ragnarok and Baz Luhrmann painstakingly recreated Las Vegas for Elvis, serving as a firm reminder that while NSW is still in the planning phase, the Gold Coast has been hosting  A-list films for years.

Does it help the local Australian film industry?

Indirectly, yes. Large international productions act as a high–intensity training ground. Local crews learn world–class techniques on a Marvel set and then bring that expertise to smaller, local independent films.

The risk is that these big studios become 'gated communities' for Hollywood; for this investment to truly inspire locals, the government must ensure the space remains affordable for smaller, home–grown stories to be told alongside the blockbusters.

You can find the expressions of interest page on the Screen NSW website.