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This movie was filmed on a vacant lot in a burned-out area of Manhattan’s Lower East Side (Eighth Street between Avenues C and D). In order to achieve the scene in which the building burns down, Spielberg built as a set a complete fake tenement on this lot in which the movie was filmed, and which was then burned down.

The filming of the movie sparked protests from housing activists in the community. It is an insult to New York City’s tenant movement, the protesters said, to present aliens from another planet as the sole hope for tenants facing eviction. More significantly, in an area where real housing is so desperately needed, it is a crime against the community to construct fake housing, only to burn it down and leave nothing for the community. If Spielberg were really concerned about gentrification, the protesters said, he would use the proceeds of this movie to construct actual low-income housing.