Jerry Snyder finally has his movie theater. The $50 million Howard Hughes Promenade retail center being built by his company, J.H. Snyder Co., in Westchester has landed National Amusements Inc. for a new live entertainment/movie theater component.
Snyder and a joint venture of National Amusements and CineBridge Ventures agreed last week on a 25-year lease at the project, which is to be called The Bridge. Snyder would not disclose the rental rate for the 106,000-square-foot theater.
Coming on the heels of last week's announcement that Pacific Theatres Corp. would join OliverMcMillan's Town Plaza project in Culver City, the deal is another bit of good news on the local movie theater development front after months of uncertainty following bankruptcy filings by some large exhibitors.
It's a pinch that Snyder knows all-to-well: Last summer he booted Edwards Theatres Circuit Inc. out of the 250,000-square-foot Promenade development shortly before the theater chain filed for bankruptcy protection. He never fretted over finding another theater tenant.
"We just kept building the damn thing," he said. "The idea was to find someone who wasn't broke."
Closely held National Amusements, which operates more than 1,350 movie screens in the United States, United Kingdom and Latin America, appears to fit that prerequisite.
The company's chief stockholder is Sumner Redstone, chairman and CEO of Viacom Inc. National Amusements holds 68 percent of the outstanding shares of Viacom's common stock, according to the company's most recent proxy statement. Redstone's daughter, Shari Redstone, is the president of National Amusements.
The 4,200-seat, 17-screen Bridge theater is envisioned to be a high-end venue, with valet parking, a lounge area, a live performance space called Center Stage, an IMAX auditorium, assigned seating and media pods for listening to music and viewing video clips. At least one of the theaters will offer food and drink service, Snyder said.
Snyder said the complex, which is already under construction, is slated to open in May. CineBridge and National Amusements will customize the two-level theater space, which includes a two-story lobby.
While Snyder and OliverMcMillan have firmed up key components of their development puzzles, another developer in need of a theater anchor is not having the same luck.
Developers Diversified Realty Corp. is still searching for a theater tenant for its 512,000-square-foot Queensway Bay development in Long Beach. The company was given a reprieve of sorts when the Long Beach City Council on Feb. 13 gave it another 15 months to close on a ground lease for the development site.
DDR lost Edwards Theaters Circuit Inc. and Resort Theaters of America to bankruptcy, the latter jumping out the very week that DDR was to break ground last October. DDR spokesman Scott Schroeder said that company officials are starting to talk optimistically about a December groundbreaking.
The extension from the city required DDR to post a refundable $500,000 deposit on the ground lease and specifies that the city is free to negotiate with backup developers. Should DDR fail to close the lease in 15 months, it would have to turn over to the city more than $5 million in due diligence work.
Schroeder said that, with the extension in hand, the company, which is negotiating with a theater anchor, is not worried about closing on a lease.
"They're going good," Schroeder said of the talks. "We anticipate we will be able to announce new tenants by the middle of next month."
Schroeder declined to reveal the prospective theater tenant, but said there will be announcements soon regarding restaurants and retailers that have committed to the project. Already on board are Cost Plus, Barnes & Noble and California Pizza Kitchen.
Change of Identity
In what at first blush appears to be a cosmetic change, Pacific Theatres Corp. has changed the name of its real estate arm from Pacific Theatres Realty to Robertson Properties Group.
The name change is an effort to separate the real estate business from the movie exhibition operation, according to Neil Haltrect, formerly vice president of operations at Pacific Theatres Realty and president of the newly named company.
Robertson Properties will develop existing Pacific sites not used as theaters for other commercial uses.
One such project is the redevelopment of the Cinerama Dome theater on Sunset Boulevard in Hollywood, a stone's throw from the Hollywood & Highland project being developed by TrizecHahn Corp.
Project on Track
Speaking of TrizecHahn, its recent announcement that it expects to sell the $455 million Hollywood & Highland project next year is no indication that the project is struggling, company officials say.
The decision to sell is part of a business strategy to exit the retail and entertainment business and increase focus on U.S. office properties and develop a global technology center business, according to a company spokesman.
In keeping with that strategy, Hollywood & Highland will be put up for sale along with the Paseo Colorado project in Pasadena and Desert Passage in Las Vegas.
The announcement has not alarmed the Hollywood business community, according to Kerry Morrison, executive director of Hollywood Entertainment District Property Owners Association.
"It does not signal they are leaving the project," Morrison said. "My understanding is that there is no diminution of their commitment to finishing the Hollywood & Highland project."
According to the developer, Hollywood & Highland will open in November. Its 425,000 square feet of space is 68 percent pre-leased, and includes a 180,000-square-foot movie theater and a 40,000-square-foot ballroom, which will become home to the Academy Awards.
Morrison said that TrizecHahn should have little problem marketing its massive development because the economic climate in Hollywood is good and getting better.
"All arrows point upward," she said.
Morrison's assessment seems to be supported by a study recently released by the Hollywood Entertainment District Property Owners Association that showed a 26 percent increase in retail, restaurant and cinema business between 1997 and 2000. The district runs along Hollywood Boulevard between La Brea Avenue and Gower Street.
Staff reporter Christopher Keough can be reached by phone at (323) 549-5225 ext. 235 or via e-mail at email@example.com.
For reprint and licensing requests for this article, CLICK HERE.