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Author Topic: AMC to close first megaplex
Adam Martin
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Posts: 1090
From: Dallas, TX
Registered: Feb 2003


 - posted May 27, 2010 09:32 PM      Profile for Adam Martin   Author's Homepage   Email Adam Martin         Edit/Delete Post 
From a press release:

quote:
AMC Entertainment(R) Elects Not To Exercise Lease Extension for AMC the Grand 24 in Dallas

*Kansas City, Mo.* (May 27, 2010) - AMC Entertainment Inc. (AMC), one of the world's largest theatrical exhibition and entertainment companies, announces today that its wholly owned subsidiary, American Multi-Cinema, Inc., will not exercise its option to extend the lease for AMC The Grand 24, currently held by EPT Down REIT II Inc., a subsidiary of Entertainment Properties Trust (EPT).

This marks the end of an era, as AMC The Grand 24 was the first megaplex - a theatre with 14 auditoriums or more and stadium seating - ever built in the United States in 1995.

"It's disappointing that we have not come to terms on a historical, and to us, a somewhat sentimental property," said Gerry Lopez, AMC's chief executive officer and president. "But in our opinion, the proposal advanced by EPT is simply untenable. We continue to negotiate with EPT on several other properties and will see where those discussions take us."

The EPT lease contains a notice deadline of May 31, 2010 to exercise its renewal option. Because AMC elected not to exercise its option to renew the lease, it will now expire on Nov. 30, 2010. AMC will vacate the premises and remove its equipment prior to this date.

"Throughout the past 15 years at AMC The Grand 24, we made history and developed many friends in the community" said Mark McDonald, AMC's executive vice president of global development. "We will miss them."


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Jeff Arellano
Senior Member

Posts: 685
From: Monterey Park, CA
Registered: Jun 2003


 - posted May 27, 2010 11:57 PM      Profile for Jeff Arellano   Email Jeff Arellano         Edit/Delete Post 
Wow that's shocking. I wonder if another operator would take it over. At least we know what it did to the industry.

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Scott D. Neff
Tour Guide

Posts: 661
From: San Francisco, CA
Registered: Feb 2003


 - posted May 28, 2010 08:48 AM      Profile for Scott D. Neff   Email Scott D. Neff         Edit/Delete Post 
Hard to think of AMC being sentimental about a property.

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John Robert
Member

Posts: 135
From: Addison, TX
Registered: Jan 2005


 - posted May 28, 2010 02:22 PM      Profile for John Robert   Email John Robert         Edit/Delete Post 
Here's local angles: now....

Dallas Observer 'Unfair Park' blog article

quote:
It's Curtains For the AMC Grand 24

By Robert Wilonsky, Thursday, May. 27 2010 @ 2:21PM

​A little while ago AMC Entertainment Inc. sent out a press release announcing that come November 30, it will "vacate the premises" at the 24-screen AMC Grand off Stemmons Freeway and W. Northwest Highway. But it'll be dead long before that, as AMC has to get 24 screens and 15 years' worth of stuff outta there long before it turns over the keys. Seems AMC ran into a lease issue with the building's owner, Kansas City-based Entertainment Properties Trust, and that, as they say, is that. And just like that, the first and most revolutionary megaplex ever opened in the U.S. will be no more.

I've left messages for, among others, John Weis, head of investor relations at EPT, to see what'll become of the property. I'll update if and when we get calls back. AMC officials also aren't available. Instead, all we have are the statements of AMC execs who say they're real, real sad to go, but, eff it, that's showbiz:

"It's disappointing that we have not come to terms on a historical, and to us, a somewhat sentimental property," said Gerry Lopez, AMC's chief executive officer and president. "But in our opinion, the proposal advanced by EPT is simply untenable. We continue to negotiate with EPT on several other properties and will see where those discussions take us."

"Throughout the past 15 years at AMC The Grand 24, we made history and developed many friends in the community," said Mark McDonald, AMC's executive vice president of global development. "We will miss them."

...and, by way of an Observer commenter, then (May 1996):

Dallas Observer article

quote:

Attack of the killer megaplexes

The number of movie screens in Dallas has almost doubled overnight. But that's no cause for applause.

By Arnold Wayne Jones Thursday, May 23 1996

AMC's The Grand--the Gotham City of film-exhibition venues--officially opened its doors in May 1995 with its inaugural movie, Die Hard with a Vengeance. One year later, The Grand can lay claim to unofficially opening the doors to something else as well--an unstoppable movie-house feeding frenzy that has seen three additional theaters open in Dallas, with more on the way.

The Grand, with 24 screens, is currently the largest single theater in the world, although that record will be broken twice before the end of the year. It already faces competition from three other newly christened venues, including the 17 screens of Cinemark 17 on Webb Chapel Road, the 14 screens of Sony's Cityplace near Lemmon off Central Expressway, and the new United Artists Galaxy 9 at LBJ Freeway and Jupiter Road, which opened this week.

The age of the megaplex has arrived.
"Our industry is entering a period where we are reinventing ourselves with all these megaplexes," says Joe Brock, AMC's Southern Division marketing manager. "The Grand was the first to hit the marketplace. We have opened several of these across the country since then," including one set to debut in Houston this week.

The trend is unmistakable. According to Brock, "Megaplexes are rapidly becoming the major force" in film distribution.

You'd think that such unprecedented growth would be a godsend to the film-going public. But despite their technological proficiency and ostensible convenience, there's a depressing dearth of exhibitor creativity among the megaplexes. No new art houses. No repertory houses.

"The commercial product is in [greater] demand" than the art films, Brock concedes. And the megaplexes clearly plan to go where the money is.

Four years ago, there were about 16 centrally located first-run theaters in Dallas, accounting for some 75 screens. None of those theaters had double-digit screens under one roof; the most for any one venue was eight. By the end of this summer, seven new theaters will have opened--including five of them within 13 months--for a total of 100 additional screens.

"The other theaters have all been doing well--moviegoing in Dallas increased last year while overall the industry stayed flat nationwide," Brock says. "Dallas has overwhelmingly latched onto this concept."

Still in the wings: another 24-screen AMC cinema at Prestonwood, slated for a fall 1997 debut, and the Mesquite Cinemas 10 in July of this year.

The technology and innovations at prototype facilities like The Grand are state-of-the-art, offering refinements like stadium seating, digital sound, and high-backed "love seats" with removable arms for better snuggling.

But the theater leaves much to be desired in terms of user-friendliness. The Grand can seat 5,000 moviegoers at a time, not to mention the people milling around its video-game arcade and concessions stands intended to make the theater a "total entertainment destination point."

But all 24 screens are served by, at most, six cashiers working at a single-entrance box office. By contrast, the UA Plaza at Central Expressway and Park Lane is more than twice as efficient: It has four booths for eight screens--a ratio of 1-to-2 instead of 1-to-4--and less traffic and congestion for the films.

Getting into The Grand is no picnic, either; in fact, it would be hard to contrive a more awkward bottleneck. There is only a one-lane road winding its way to the megaplex, located off Northwest Highway and Interstate 35. The majority of patrons must enter the parking lot by way of a short, left-arrow-only traffic signal. The parking lot's mostly one-sided design--fanning away from, rather than around, the building--can force customers to park a quarter-mile from the theater.

You can't help but wonder if the theater was able to achieve its success mainly by bullying the market. (The Grand is one of the five busiest theaters in the nation, according to Brock.)

The Cinemark 17 is easier to get to, but lacks the appeal of traditional movie palaces. The lobby is devoted to television, video games, and a diner to keep bored soon-to-be movie-watchers occupied; you have to look carefully to find the entrance to the screens. The decor in the theaters themselves is a decorator's nightmare. With its deep purples and sickly greens, the upholstery looks like debris from an exploded vomitorium.

The Cityplace 17 is probably the best of the new breed. It's the only megaplex in the area with two public entrances--including two parking lots--so you're never too far from the door. It's also the most aesthetically pleasing, if for no other reason than that its minimalism neither inspires nor offends.

But even as the number of screens mushrooms, the breadth of movie offerings in Dallas is waning. The Major Theatre--the last truly alternative film venue in Dallas--has closed its doors to moviegoers, even as megaplexes sprout across the landscape.

The megaplexes tend to be lap dogs of popular taste. Hollywood studios produce basically the same number of movies each year, so the exponential growth in screens signals one thing: The multiplexes aren't designed to offer a wide selection of films, but to inundate us with the least common denominator of mainstream movie-making.

Twister debuted on five of The Grand's screens, while The Journals of Jean Seberg has yet to be seen in Dallas outside of the USA Film Festival. Last summer, Batman Forever showed simultaneously on nine screens at The Grand. Although The Grand devoted four screens to foreign films when it first opened, that trend lasted less than a month.

That seems to contradict Brock's assertions that "the appeal of the megaplex is the movie choice," and that its goal is to "offer multiple showtimes and a much-larger array of movies to pick from."

"The trend in the industry is to combine movies with dining and retail so when you're planning your Friday night, you can go to The Grand and take care of all your entertainment needs," Brock adds.

"For the big blockbusters, I love to go to The Grand," confesses David Kimball, manager of Landmark's Inwood Theatre on Lovers Lane and Inwood Road. But he knows that the Inwood, and the UA Cine at Yale and Central, have effectively cornered the market on art films in Dallas. "Customers look for art films to play here first, and that's why we have a lot of exclusive runs," he says.

The multiplexes just can't seem to stomach the modest but devoted following of art films. "If they play these little films and expect blockbusters," they are going to be disappointed, Kimball says. Consequently, the megaplexes pose no threat to art houses. "People call [the Inwood] from Oklahoma City and Tulsa all the time because, unfortunately, a lot of these films aren't available in their market," he says.

That's good for Landmark, but does it serve the Dallas moviegoing audience? Maybe so. Dallas may be, after all, the ultimate consumerism center.

"I've been told that some of the film [-distribution] companies use the Inwood as a barometer to see how art movies will work nationwide," says Kimball. "Dallas is just full of moviegoing fools."

"Dallas is undeniably a major market," says Alonso Duralde, artistic director of the USA Film Festival. The proof of its appeal is clear: "On Tuesdays, Daily Variety runs a breakdown of weekend box-office receipts for three markets: one is Los Angeles, one is New York, and one is Dallas. I think Dallas is considered [representative] for what the studios refer to as 'flyover country.'"

Dallas is also one of the few cities between the coasts that has offices for major film distributors, Duralde adds.

The megaplexes may not even be to blame for the absence of creative film distribution--"We've seen a decline in repertory theaters because of the home-video revolution," Duralde notes--so as long as there's a need, the megaplexes can be expected to continue their onslaught.

"We keep thinking they're overbuilding and oversaturating the Dallas market," says John Krier, president of Exhibitor Relations, a company that studies the statistical breakdown of box-office grosses. "But it hasn't happened. Yet.


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Christopher Crouch
Member

Posts: 292
From: Anaheim, CA
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 - posted May 29, 2010 03:37 AM      Profile for Christopher Crouch   Email Christopher Crouch         Edit/Delete Post 
It's amazing how relatively quickly a site can turn from crown jewel to expendable. For the first few years of the "megaplex era", AMC used the Grand as a constant reference. I can still remember standing in the Fullerton 10 lobby between sets, watching a promo the "southern California marketing coordinator" had on the Grand, shown on a 20" box style tv that was hooked up to a VHS vcr (funny to think everything I mentioned in that last sentence is now gone). I recall everyone speculating if the concept would really become the standard, as the promo video stated. Of course, within a year, everything was heading that direction, including Fullerton.

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John J. Fink
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Posts: 123
From: Buffalo, NY
Registered: Aug 2005


 - posted May 29, 2010 06:50 AM      Profile for John J. Fink   Author's Homepage   Email John J. Fink         Edit/Delete Post 
It is telling, however that the Grand didn't have a digital 3-D projector. But EPT has ambitions to add retail and scale down the number of screens for another tenant. They also work with Rave. Also interesting to note is that EPT was spun out of AMC if I remember correctly.

I think AMC will be removing their property, so they might have to start over again from a bare building. I don't know what kind of area it's in, it seems like a few other plexes of the era, including the Loews (Sony) theaters mentioned in an early article have also closed. Cinemark closed a 24-plex in Houston as well.

I think we're in an era where 14-18 is the magic, sustainable number.

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Christopher Crouch
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From: Anaheim, CA
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 - posted May 29, 2010 03:18 PM      Profile for Christopher Crouch   Email Christopher Crouch         Edit/Delete Post 
quote:
I think we're in an era where 14-18 is the magic, sustainable number.

That was likely the case all along, it just took the exhibition industry a decade, not to mention a financial collapse, to figure that out for themselves. Even at the height of the mega plex era, 20-30 screens was an inefficient business model.

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Jeff Arellano
Senior Member

Posts: 685
From: Monterey Park, CA
Registered: Jun 2003


 - posted May 29, 2010 05:02 PM      Profile for Jeff Arellano   Email Jeff Arellano         Edit/Delete Post 
I got off the phone with my friend who works at AMC and their new plan is to convert another one of the megas to a mixed theater. She mentioned Grapevine 30 will do what Studio 30 has done and will have one wing converted to Fork and Screen. I can see the 30's and 24's doing this. 13 screens for fork and screen then one imax and 16 screens of traditional stadium (or 10/1/13 for a 24). This gives a good choice for patrons.

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John J. Fink
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Posts: 123
From: Buffalo, NY
Registered: Aug 2005


 - posted June 01, 2010 02:03 PM      Profile for John J. Fink   Author's Homepage   Email John J. Fink         Edit/Delete Post 
Well one of their 30 plexes will soon be Regal's problem.

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Eric Gieszl
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Posts: 57
From: Las Vegas
Registered: Sep 2006


 - posted June 01, 2010 07:30 PM      Profile for Eric Gieszl           Edit/Delete Post 
I don't see in the article where AMC thought the complex was disposable per say. However, they clearly were trying to alter the terms of the lease extension and likely because these megaplexes have not met performance expectations. The landlord on the other hand was probably expecting a rent increase.

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John Robert
Member

Posts: 135
From: Addison, TX
Registered: Jan 2005


 - posted June 02, 2010 12:48 PM      Profile for John Robert   Email John Robert         Edit/Delete Post 
More news....

Dallas Morning News article

quote:
Trendsetter AMC Grand megaplex closing Nov. 30

11:24 AM CDT on Wednesday, June 2, 2010
By CHRIS VOGNAR / The Dallas Morning News

When the AMC Grand opened in 1995, it was a unique behemoth: the first megaplex not only in Dallas but in the country. With 24 screens and a parking lot that felt like a city, it was the place to see all the big, new releases.

Times have changed. Boutique theaters are increasing, and the Grand, at I-35 and Technology Boulevard, is scheduled to shut its doors by Nov. 30.

American Multi-Cinema Inc., AMC's wholly owned subsidiary, will not exercise its option to extend the theater's lease, the company said.

AMC's theater in NorthPark Center continues to thrive, but the AMC Glen Lakes on Walnut Hill Lane at North Central Expressway closed in 2006.

The local theater scene has moved toward specialty exhibition since the Angelika opened in 2001 and the Magnolia opened in early 2002. Both theaters show art-house fare and offer drinks you can take to your seats. Meanwhile, Studio Movie Grill expanded into Dallas proper, adding to its many locations around the area.

More recently, Gold Class Cinemas, part of a new luxury, dinner-and-drinks theater trend, opened at the Village at Fairview on May 7.

...plus this article with the owner of the building:

Dallas Observer 'Unfair Park' blog posting

quote:
The Owner of the AMC Grand 24 Building Finally Talks About What's Next
By Robert Wilonsky, Wednesday, Jun. 2 2010 @ 10:00AM

​Took a few days, but last night I finally got a call back from John Weis, head of investor relations at Kansas City-based Entertainment Properties Trust, which owns the building that has, since May 1995, housed the AMC Grand 24. On Thursday, AMC said it's outta there by no later than November, as it opted not to renew its lease for reasons that remain unspecified outside of EPT offered an "untenable" lease renewal option. Which left one other big question: What does EPT intend to do with the massive theater, once the largest in the world?

"Find another theater operator," Weis tells Unfair Park. Simple as that. "It's a good location and among the Top 20 highest-grossing theaters in the Dallas metro, so we'll move forward and look to release the property. AMC is just closing up shop -- they don't own the property or the land. Tenants come and go, and we'll attempt further negotiations if they're interested in staying, or we'll find another theater operator."

Weis wouldn't get specific about why AMC had decided to leave; he wouldn't say how long EPT and the exhibitor had been in lease-extension negotiations or why they broke down, leading to last week's announcement. He'll just say it was their "corporate decision" and leave it at that. But, of course, he thinks it's a mistake: "Dallas is a very, very strong exhibition market," he says. And, again, he mentions that the AMC is still pulling in decent dollars.

I asked him if he was surprised by last week's announcement. He says no, since it came after an extended back-and-forth. But he will not get into a war with AMC. Because, who knows, maybe it'll decide to stay. But, probably not: "AMC is a great operator and a great tenant, but it's their choice," he says.

So, then, since the announcement, have any other exhibitors stepped up to say they're interested? Again, Weis refuses to be specific.

"One, it's a great location, and it has historically done well," he says. "It's a Top 20-grossing theater in the market. When we've got something to tell our investors and the public about, we'll let everyone know. But AMC is still there till the end of the year. The lease has a specific end date. If they leave early, rent's still due. And on our side we'll talk to other theater operators. Others know it grosses well, it's a good location. This is a decision by AMC -- it doesn't fit in their corporate strategy. That appears to be what has happened."


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