A major Hollywood infrastructure player is scaling back sharply, cutting jobs and shutting down key parts of its studio services business. The move is underscoring continued strain across the production economy centered in Los Angeles and California.

Hudson Pacific Properties is winding down most of its Quixote soundstage operations in LA while also exiting operations in Georgia and New Mexico.

The move will affect about 70 employees across Atlanta and LA, a source familiar with the decision told the Hollywood Reporter.

The pullback marks a reversal for a company that expanded aggressively during the streaming boom, when demand for production space surged across California and competing production hubs nationwide.

Back in March, Hudson Pacific CEO Victor Coleman warned of shifting production patterns, saying: “LA and New York have seen a rise in production with the downfall of other markets like Albuquerque, New Mexico, New Orleans, Louisiana, Atlanta,” pointing to weakening regional hubs even before the latest cuts.

In a memo to clients, Quixote confirmed the decision, writing: “Quixote has made the difficult decision to begin the process of winding down most of our sound stage business in Los Angeles, including our main commercial studio in West Hollywood,” adding: “Like many of you, we have persisted through the prolonged and ongoing slowdown in commercial, television, and film production. But ultimately, industry conditions have forced difficult decisions.”

Quixote operates vehicle fleets, production supplies, and soundstages across multiple states.

In LA, it is closing leases at several sites, including Quixote West Hollywood and its Van Nuys facility at Quixote Central Valley, formerly Chandler Valley Center Studios, known for use on NBC’s The Office.

Griffith Park Studios will remain open due to an existing tenant.

Since then, production demand has cooled sharply.

Studios and streamers have cut spending, reduced episode orders, and scaled back production slates after years of rapid expansion.

The number of original TV series has declined for three straight years, with 2025 marking an 11% drop in premieres from 2024, according to Luminate.

Hudson Pacific expects $21 million to $27 million in annual savings from scaling back Quixote operations in Atlanta and relocating select equipment to LA and New York.

Even within California, the picture is mixed.

Hudson Pacific president Mark Lammas said Hollywood stages are 96 percent leased, while Quixote stages sit at just 53.3%.

“Quixote is taking steps to move away from leased soundstages 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,” Lammas said Tuesday.

The company says core services remain active.

“Quixote’s fleet, equipment and supply rentals remain fully operational and ready to support production needs,” Sean Griffin, senior vice president of sales for Quixote told the Hollywood Reporter. “For clients of Quixote’s soundstage and Atlanta operations, we are taking a phased, collaborative approach to minimize disruption, while continuing to deliver a high level of service during this transition period.”

New Jersey posted the strongest year-over-year production growth in early 2026, while California remains the top overall production hub, though with fewer shoots than in prior years.

Hudson Pacific’s Sunset Studios in LA remains a key asset, with Netflix locked in as an anchor tenant through 2031.

The streaming giant is also reportedly in final talks to acquire the historic Radford Studio Center in Studio City, a deal that could further consolidate production infrastructure in LA even as the broader industry continues to grapple with reduced output, fewer series orders, and the aftereffects of the streaming-era production surge.