Central City Studios (CCS) have been declared "preferred tenderer" for the job of building and operating a studio and post-production complex in Melbourne. The move is a big step forward towards establishing Australia's third substantial studio complex in its second biggest city.

While CCS managing director Tim Barnett says the core business is providing sound stages and facilities to the local and international industry, he believes the CCS bid was accepted because of its determination to create a hub for local industry, including the formation of a foundation to provide training and production subsidies.

A percentage of the fees charged to international production for the use of the studios will fund the foundation. The Victorian Government stipulated when it called for tenders -- and offered A$40m in public money to encourage bidders -- that at least 25% of production at the studio had to be local. "We have been working on the bid for about 12 months," said Barnett. "We made a presentation to Government last April before we knew about the $20.3m (A$40m). Obviously it (backing) makes the project more attractive and more substantial."

The total cost of the development is $56.2m (A$111m). The Government's $20.3m will be spent on the sound stages while private funds will be used to build the tenant-based commercial part of the development. The Film Studio Group, which operates facilities worldwide, will be handling international sales and marketing for CCS, and consulting on the management and construction. It will be a minor shareholder.

The six variously sized sound stages totaling over 7,000 square metres, computer animation and production offices, and equipment rental and other support areas, will span six hectares in the heart of Melbourne. Providing final agreement can be reached, construction is likely to start in April/May and it will be open for business in mid 2003.

In the interim, the Government has secured the temporary studio space used by US picture Queen Of The Damned, shot in 2000. It has not yet been decided whether CCS will manage this facility.

CCS is chaired by Peter Bartels and also on the team is Michael Briggs, Robin Lick, John Kearney and Peter Madder. Its commercial partners include the lawyers Deacons, corporate financier Deloittes Touche Tohmatsu and architects HASSELL.