CHESTERFIELD — A fight between a general contractor and owner threatens to further delay the completion of a $150 million music production facility here that officials said would grow jobs and boost the region’s visibility in the entertainment industry.
Arco Construction last week ordered its crews and subcontractors to stop working at Gateway Studios, a 32-acre rehearsal, studio and hotel project in Chesterfield Valley. Rock Hill-based Arco alleges owner Gateway Studios & Production Services had not made payments — and it wasn’t clear the company had the funding to do so.
This week, Gateway responded, alleging Arco hadn’t upheld its obligations and wasn’t meeting the project’s timeline. It told the company that it planned to terminate their contract — an unusual move in the construction industry.
People are also reading…
Moreover, Gateway Studios CEO Trey Kerr said Wednesday, full funding for construction has been in place since the project began and payment delays were due to Arco failing to submit invoices and lien waivers in time.
“Gateway’s goal is to move this project forward as quickly as possible without any further unnecessary delays and deliver this world-class facility to Missouri and the St. Louis community,” Kerr said in a statement.
The scuffle would cause “a very brief delay,” Kerr said, but construction should still wrap up by the end of the year.
The Gateway Studios facility, at Spirit of St. Louis Boulevard and Chesterfield Airport Road, is being built as a 300,000-square-foot complex with offices, conference and dressing rooms, on-site catering, sound stages, green screen studios, live streaming, and audio, lighting, and video manufacturing and production services designed to support stadium and arena concert tours, plus other entertainment-industry business. Gateway said the facility would employ 100 workers.
Kerr, an industry veteran and St. Louis native, said he modeled Gateway after a similar facility in Pennsylvania.
The venue garnered broad support from state and local officials with a slew of public incentives, including $130 million in bonds from St. Louis County, and the ushering of a new state incentive for the entertainment industry that would allow a tax credit for rehearsal and tour expenses equal to 30% of the cost.
Its groundbreaking in 2021 brought out top politicians including Missouri Gov. Mike Parson and St. Louis County Executive Sam Page, who touted Gateway Studios as a “huge opportunity,” expected to stimulate other jobs and investment in the region.
Steph Kukuljan and other business reporters bring you insights into St. Louis-area real estate and development.
But project delays have postponed the facility’s opening from 2023 to the end of this year.
Arco and Gateway Studios had been in dispute over payment for several weeks before Arco ordered crews to leave the jobsite on Friday, Arco said.
As of this week, the site remained empty. Arco said Wednesday afternoon that it has yet to receive an official termination notice from Gateway.
“Arco met with Gateway’s ownership team to express our desire to resolve the issues and finalize a plan to finish the project. Unfortunately, these efforts were unsuccessful,” the company said in a statement.
Arco declined to share how much money it says it is owed.
But the statement called Gateway Studios’ move to terminate the deal “atypical” for the industry and said that a client had never terminated Arco in its 32-history.
“Arco’s commitment to honoring our agreements with our subcontractors, suppliers and project partners is paramount,” the company said. “After spending several weeks attempting to resolve these issues, we could no longer jeopardize this commitment.”
Editor's note: Gateway said Thursday subcontractors are not barred from the site.
Trey Kerr, CEO of Gateway Studios & Production Services, explains the services that will be offered at a new multimillion-dollar production and rehearsal facility in Chesterfield. Video courtesy of GSPS