SMALL STUDIO, BIG MOVE; LOW-BUDGET COMPANY PUTS HOPES IN SITE.

Byline: Dave McNary Daily News Staff Writer

The shuttered Cherokee clothing plant in Sun Valley is on the verge of receiving a new life as a film studio, mostly as a place where actors play cops and criminals.

Executives with PM Entertainment, a specialist in low-budget action and family films, are thrilled about the company's move to the three-story building with 125,000 square feet of space at a time when local film and TV production has been booming.

Privately held PM, which has 124 lesser-known titles in its library such as ``Big Foot'' with Matt McCoy, ``Road Ends'' starring Dennis Hopper and ``Executive Target'' with Roy Scheider, was able to snag the property earlier this year for $3.85 million. Cherokee closed the deal quickly after agreements with two other potential buyers fell through.

``We moved fast on this because there was nothing, absolutely nothing, on the market to meet our needs,'' said George Shamieh, president. ``There's such a demand right now for big industrial properties and we'd been looking in this part of the Valley for a year.''

Within a month of closing the deal, a major studio had offered to lease the entire property for three years and another had offered to buy the property outright. PM turned down the proposals and started converting the Wentworth Street property into a studio with three sound stages and extensive post-production facilities.

Cody Cluff, head of the Los Angeles-based Entertainment Industry Development Corp., said PM's plans reflect a growing local trend. Major studios such as Walt Disney Co., Warner Bros., DreamWorks SKG and Universal have massive expansion plans under way, and projects have been announced for new soundstages in Manhattan Beach, Santa Monica and Culver City.

``We also hear about a lot of other projects that people are holding off on announcing,'' said Cluff, whose agency regulates film permitting in the county. ``They're keeping a low profile until they get further along on approvals.''

With a solid domestic box office and soaring overseas demand, sound stages are often booked for a year in advance. Production in Los Angeles County has been surging with a gain of 27 percent in 1995, 29 percent in 1996 and 5 percent so far this year.

Privately held PM, which usually produces a dozen films and three television series annually, hopes to move most of its 200 employees to the revamped facility in November.

Shamieh, who co-founded PM a decade ago with partners Joseph Merhi and Richard Pepin, said his company is spending more than $1 million to upgrade and modernize the studio-to-be, which had been a fairly plain brick building in a quiet foothill area.

When completed, PM will move out of its headquarters on Chivers Avenue but keep its soundstage facility with 45,000 square feet on Peoria Street.

Buying its own studio reflects PM's strategy of tight control over operations and its ability to operate as a one-stop production facility.

``The only thing we'll have to do outside here is send out the film for developing,'' Shamieh said.

That approach has meant PM's growth has been slower than some of its rivals because it has invested in equipment and property, but it will take a step toward the big time early next year. Instead of spending the usual $2.5 million to $5 million for a movie, it is developing a $25 million project with a ``major star.''

The goal is to get a PM movie into the potentially lucrative U.S. theatrical market for the first time rather than being seen only on U.S. cable channels and videocassettes. The films generally perform most strongly in the Far East, Middle East and Latin America.

The long-term strategy is to start competing against giants like Disney and Warner by releasing two films annually to the domestic theatrical market. ``Either we're fools or we must be doing something right,'' Shamieh said.

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5 Photos

Photo: (1-4--Color) Lights, camera, expand

PM Entertainment, a specialist in low-budget action and family films, has plans to release larger-scale films. Among its titles:

(1) ``ROAD ENDS''

(2) ``BIG FOOT''

(3) ``LITTLE BIG FOOT''

(4) ``HOLLYWOOD SAFARI''

(5--Color) Chevonne O'Shaughnessy, vice president of foreign sales, and George Shamieh, president, see a rosy future for PM.

Evan Yee/Daily News