Hudson Pacific Properties announced a phased wind‑down of its Quixote subsidiaries’ leased sound stage facilities and Atlanta‑area operations, a move that will be executed over the coming quarters. The company will relocate select equipment to its Los Angeles and New York studios, where Quixote’s full‑service offerings will continue.
The wind‑down is part of a broader cost‑optimization strategy that follows significant impairments and operating losses reported in 2025. By shedding the Atlanta footprint, HPP expects to generate annualized cost savings of $21‑$27 million, a reduction that will help offset the $572.5 million loss the company recorded in 2025 and improve profitability in the studio segment.
Quixote’s Atlanta operations have historically operated at a lower occupancy rate than HPP’s Hollywood and Manhattan studios. The company’s Hollywood stages are 96% leased and Manhattan stages are 100% occupied, while Quixote’s Atlanta stages were operating at roughly 53% capacity. The decision to exit Atlanta reflects the structural cost and demand disadvantages that have made the market less attractive.
Management explained that the wind‑down will allow HPP to reallocate financial and operational resources to its stronger office portfolio, which accounts for 87% of revenue, and to Sunset Studios, which continues to show robust demand. "Quixote is taking steps to move away from leased sound stages and markets characterized by structural cost or demand disadvantages, which will allow Hudson Pacific to focus financial and operational resources on our office portfolio and higher performing segments of our studio business," said Mark Lammas, president of Hudson Pacific.
The company’s broader strategy has already produced tangible results. In 2025, HPP completed nearly $330 million in strategic asset sales, extended its debt maturity runway, and nearly doubled liquidity. The upcoming Atlanta wind‑down is the latest step in a series of actions aimed at reducing net debt and strengthening the balance sheet.
Analysts note that while the wind‑down signals a contraction in studio operations, the expected cost savings and focus on higher‑yielding assets should help improve the company’s earnings profile over the next few quarters. The move also aligns with industry headwinds, including a post‑pandemic construction boom, strikes, and tighter streaming budgets that have pressured studio demand.
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