The fire has gripped an industrial building on Rongotai Rd, near Wellington Airport.

Parts of troubled movie The Hobbit may have literally gone up in smoke after a Wellington miniatures studio lined up for filming on Sir Peter Jackon's movie was damaged by a major fire.

Fire crews battled for nearly three hours to put out the blaze at the Rongotai Road warehouse and workshop housing Portsmouth Miniatures Studio, a shooting stage owned by Sir Peter.

The flames prompted a flood of calls from throughout Kilbirnie and neighbouring areas, including from the air traffic control tower at nearby Wellington Airport.

"It would have been used in the shooting of The Hobbit, yes," a spokesman for Sir Peter's Wingnut Films production company, Matthew Dravitzki, told NZPA.

The producers are currently in a dispute with actors over employment terms for the adaptation of JRR Tolkien's book, with unions threatening to escalate into a worldwide boycott of the production.

The project has been hit by other problems, including financial troubles for MGM, which owns the rights to The Hobbit, and the departure of director Guillermo del Toro in May because of delays.

Portsmouth had provided a large studio and shot all the miniatures and many special effects for the King Kong and Lord of the Rings movies, according to the company's website.

"It's a specialist miniatures shooting facility, it's one of the only ones in the world, and I can't comment at this point as to whether (the damage) will cause a problem," Mr Dravitzki said.

They were waiting for an inspection by the fire service and their own insurers for information about what had been damaged and lost, or how long it would take to restore the facility.

"I probably won't know that until after the weekend."

He would not comment on what had been stored in the building, because there were items of commercial sensitivity.

Part of the building had been fairly extensively damaged, although he would not say which part.

The building was being reroofed at the time. As well as the contractors working on the roof, there was one person inside the building.

"When he walked into the building, he saw it was well ablaze and he got out uninjured and unharmed for which we're very thankful and pleased.

"He was able to raise the alarm - it could have been much worse I gather if he had not spotted it," he said.

The fire was in a big commercial building right behind the Kilbirnie Fire Station, producing a large black cloud of smoke, one witness said.

The Fire Service received an automated alarm about 3pm, followed by a flood of calls from nearby residents spokesman Chris Dalton told NZPA.

"We were lucky enough to have a fire appliance drive past at the exact same time (as the alarm), which saw some flames coming out of the roof, so we escalated the response straight away," he said.

The fire received a major response, which the service calls fourth alarm, out of a scale of one to five.

"I believe it was a workshop area and the warehouse part of it, and (in) the workshop area was a reasonable amount of damage - but I think it was a good save, actually," Mr Dalton said.

LPG cylinders and other hazards were involved as well.

The fire was extinguished nearly three hours later, about 5.45pm, but two fire trucks remained to check out any flare ups.

The building has a 2009 valuation of $3.2 million.