When Frazer Dougherty built a 35,000-square-foot facility in the East Hampton Town industrial park in the late 1990s to house a sound stage, he pictured a bustling facility filled with production companies making movies and television shows that would boost widespread sectors of the local economy.
The $5 million building was the second he had put up in the industrial park, which was designed for businesses that would generate local jobs. Mr. Dougherty had previously put up a building there for LTV, East Hampton’s public access television channel, which he founded.
The dream of East Hampton as Hollywood East was fostered in recent years by Michael Wudyka, who, with a partner, bought the sound stage from Mr. Dougherty for a reported $1.4 million in 2007, and by East Hampton Town Supervisor Bill Wilkinson, a transplant from Los Angeles, where he worked for the Disney corporation.
But the film business has failed to take off here, and, Mr. Wudyka told the East Hampton Town Board on Aug. 12, despite five years of trying, he has no choice but to throw in the towel.
Because the allowable uses of the building are limited by the town, Mr. Wudyka is seeking town board approval for its use as a storage facility by the only potential buyer he has lined up. It’s his only option, he told the board.
The building was operated in recent years as East Hampton Studios, a combination sound stage and entertainment venue, and it has been for sale for three years. Last year, the town board agreed to allow Mr. Wudyka to convert about half the square footage to storage, but now, he said, he needs to sell the entire facility to the storage company.
In addition to efforts to raise awareness worldwide about the opportunities in East Hampton for filmmaking, and the sound stage’s services, Mr. Wudyka said he had invested $1 million in keeping the facility up to date — to little avail.
Film productions, such as the crews making the Diane Keaton and Jack Nicholson movie “Something’s Gotta Give,” “The Romantics,” and “A Winter’s Tale,” did use the building, bringing, according to Mr. Wudyka, “close to $500,000” in ancillary spending into the local economy, but he lost money on the deals.
“I took a financial loss on every single production that’s come in,” he said. “I tried to build an industry.” Overall, he said, he estimates his business helped to bring $10 million into the local economy — but his bottom line suffered. “That has led . . . to a shortfall in delivering your commitment to the town,” said Mr. Wilkinson, in a delicate reference to the back rent Mr. Wudyka owes.
Mr. Wudyka said town officials had been “extremely helpful and supportive in delaying our debt.” But now, he said, “the well has run dry. At the end of the day, it’s not a viable business. It’s been a huge financial burden, personally and emotionally.”
“It’s going to break my heart to walk away from the idea,” Mr. Wudyka said.
“We tried very hard to manage your lease to give you as much flexibility as possible,” Councilman Dominick Stanzione told Mr. Wudyka. “You’re still not generating enough income to cover the lease.”
“The decisions have to be: What do we want in that facility?” Mr. Wilkinson said. “Regardless of Michael’s success, or his lack of success, do we still want that facility to be what it is?” Or, he said, does the board feel that the situation would be the same if another businessman tried to make a go of the sound stage?
Allowing a different use of the building, Mr. Wilkinson elaborated at a work session on Tuesday, “would change what I thought was, at some point in time, the mission” of the facility.
“This board had in the past made a pretty strong commitment to media, and the use of those assets for entertainment arts,” Mr. Stanzione said.
According to John Jilnicki, the town attorney, if the board does not agree to a new use of the building, eviction proceedings against Mr. Wudyka would ensue, and the town would seek a judgment requiring him to pay the rent in arrears.
The town could then look for another entity to operate the sound stage, Mr. Wilkinson said. “The town doesn’t seem qualified to do much,” Councilwoman Theresa Quigley said.
Under the original lease, Ms. Quigley pointed out, the town, to help foster the film business, had asked only a nominal rent. But the property in the industrial park is technically part of the airport’s acreage, and the Federal Aviation Administration intervened.
Airport acreage, the agency said six years ago, if leased, must fetch fair market value, and the money must go into an airport fund. That meant a hike in Mr. Wudyka’s rent, up to about $50,000 a year. “It’s not a viable business plan to hit somebody with something like that,” Ms. Quigley said.
In order to retain the right to lease the site at a reduced rate, Ms. Quigley said, the town could pursue its release from the airport footprint. That could be a good idea, Councilman Stanzione and Councilman Peter Van Scoyoc agreed, but it would likely be a lengthy process, which would not help Mr. Wudyka out of his jam. The back rent would be paid to the town immediately upon the sale, Mr. Wudyka said.
Mr. Wudyka has been a member of the Suffolk County Film Commission, on the board of directors of the Creative Coalition, which raises arts awareness nationwide, and been involved with the Hamptons International Film Festival.
He was also a member of the town’s own Media Advisory Committee, created in 2011 under the sponsorship of Ms. Quigley. After setting up a Web site, now defunct, and beginning work on a list of public properties available for film or photography production, as well as a database of local professionals in the field, the committee has “informally disbanded,” Jenny Landey, a co-chair of the group, said this week.
Ms. Landey, an East Hampton resident who operates a photo and event location and production company, said there always would be shoots here, driven not only by the scenery but also, perhaps, by movie stars who own houses here and don’t want to travel. But, she said, “it’s always been riddled with hurdles that we can’t control.” Those, both she and Mr. Wudyka said, include the distance from New York City, limited lodging, and a dearth of the technical workers needed for all aspects of a film shoot.
In addition, Mr. Wudyka told the board last week, the East Hampton Studios space is not spacious enough for large productions, and the building does not provide the cafeteria, offices, dressing rooms, and the like that such productions require.
However, Ms. Landey said, the media committee had coalesced a community of the professionals that are here, and is ready to reconvene “if there is a need.”
Ms. Quigley said Tuesday that she is inclined to agree with Mr. Wudyka’s request. “If the underlying use can’t be sustained, then I think we’re fools not to change the use,” she said. “I mean, I’m very disappointed that it can’t work, but if it can’t work, it can’t work.”
Following the public discussion of the building’s use, the board met in executive session to discuss the financial aspects of Mr. Wudyka’s lease.