The industry is turning its gaze to Hungary as a HUF 17bn mega studio, Europe's newest and flashiest, is unveiled for the scrutiny of executives for the first time on Thursday.

Business daily Vilaggazdasag said Raleigh Studios of the US -- which has tied up with FotoKem, a leading US post-production company -- has built the complex situated on the outskirts of Budapest in Rakospalota in cooperation with Europe's Origo Film Group.

The studios house a full service lab and post-production facility, operated by Los Angeles-based FotoKem, as well as nine full sound stages and a huge back lot for outdoor sets.

In order to nurture the existing local talent pool, a training college will also operate at the studios.

Raleigh Studios said it expects Budapest to serve as a production hub for Europe for cheaper rates than other European countries.

The 17.5-hectare facility is due to open in April.

Raleigh Studios president Michael Moore said Hungary was selected as the location for the investment because of the attractive tax conditions, the availability of qualified workforce and the diverse architecture of the capital city.

The market operators interviewed by the paper said there is already a degree of oversupply on the market due to the number studios in Hungary and their capacity.

Hungarian film studios closed a mixed year in 2009. Film production was hit by the general negative trends with foreign customers often delaying shooting for 2-3 months and financing possibilities narrowing considerably. Furthermore, the system of tax refunds, otherwise a great attraction, was suspended for six months in 2008, leading to a decline in the number and value of productions in Hungary even in 2009.

However, Hungary's film industry increased its total revenue to HUF 48.5bn in 2009, including HUF 15.2bn from contract work for foreign productions, HUF 20.1bn from co-productions and HUF 13.1bn from Hungarian films. Total revenue was up from HUF 45.8bn in 2008, which included HUF 4.8bn from contract work, HUF 21.4bn from co-productions and HUF 19.6bn from Hungarian productions.