I am pleased to forward to you, Kristen, a response from John Bell, a League board member and Executive Director of the Tampa Theatre, a 1,452-seat city-owned and non-profit managed historic theatre in Tampa, FL.  The Tampa Theatre is renowned for its film programming, as well as live performances and educational programs.

 

 

 

Fran:  Please see my thoughts below in blue:

 

Summary of questions related to operations and business model:

Members of the Advisory Panel would like to get a better understanding of how the film industry works today, whether a single screen theater is viable, and whether a multi-purpose venue which also includes first run films is feasible.   They also question the feasibility of getting private donations to cover a portion of the cost of improvements.

1.      Is it feasible for Buzz Cusack to run a one- or two-screen first-run movie theater?  The odds of turning a profit – without subsidy – with a one screen theatre are very low and maybe zero; two screens would give the site better odds, but even still there are no guarantees.  However, given that Mr. Cusack successfully operates a 5 screen theatre nearby, he will have some leverage and bargaining power with film distributors as he competes for film product.  I am unfamiliar with the distances involved between his existing theatre and the Senator, so I am not in a position to speculate as to whether distributors would view the Senator as a potential roll over site for films he opens at his existing venue, or even if that is in his business plan.   In fact I hope its not, as that would relegate the Senator to being a second run house when in fact the facility has the capacity (and the heritage) to have a more important programming profile.

2.      What options does Mr. Cusack have to move first run movies that are no longer performing but for which he is still under contract to show?  With one or two screens, I suspect he will have to bargain hard with distributors to grant him shorter engagements and more flexibility.  I cannot speculate as to whether or not he has that bargaining power.  Ultimately, the Senator’s only real asset when it comes to film distributors is that it has a large seating capacity, meaning that it should be able to pull substantially higher box office revenues for film openings which may provide him with some bargaining chips when vying for product and favorable terms.

3.      What are some examples of successful single-screen movie theaters?  If by “successful” you really mean “profitable without subsidy”, I cannot think of a single one.  The odds are just too long.  There may be some examples of a few commercial (for profit) single screen theatres are still open, but if they are, they are only marginally getting by.  Remember that before it closed, the Senator was operated by a man who was an extremely experienced, savvy film exhibitor.  It wasn’t because of managerial ineptitude that the Senator closed, it was most likely because the odds of making it as a viable profit-making entity into today’s world finally caught up with the theatre. 

4.      Is it feasible for WTMD, with its plans to accommodate a wide variety of activities throughout the week, to commit to showing first run movies?  Do distributors require a movie to be shown for a set number of consecutive nights?  Do distributors prefer to work with theaters that show movies all the time, rather than just some of the time?  It is possible to shoehorn some stage or community events into a theatre while maintaining a specialty first run film program.  The emphasis here is on “specialty”, meaning that distributors of blockbusters like Avatar or the next Julia Roberts’ vehicle would not allow for interruptions in the schedule to make way for local or non-film events.  However, distributors of first run specialty films – independent, foreign, documentary, etc. – are usually more flexible with scheduling, so that that losing a Tuesday or Thursday night to a concert or community event would not spell doom for running these types of first run films. However, weekends (Friday, Saturday and Sunday) are considered sacred by distributors, so if the theatre chooses to take one of those days out of play to accommodate a special event, chances are the film distributor will not give the theatre a new film to open.  We juggle this constantly, and if we want to take a concert event on a weekend, we’ll plan to simply holdover a film in its second or third week and work around it, so long as we get clearance from the distributors (which we always seem to get).   But we would never be able to open a strong, new first run specialty film on a weekend when we did not have the full weekend to work with. Of course, most specialty films do not have the box office potential of major, mainstream Hollywood releases, but on the other hand the terms for showing specialty films are usually more favorable for the exhibitor.  That’s at least our experience at Tampa Theatre. 

5.      What options does WTMD have for dealing with first run movies that are no longer performing well, but for which they are still under contract to show?  The only advice I would offer would be the same as how I responded to the similar question about Mr. Cusack’s options.  Don’t agree to very long engagements to begin with.  Usually, for specialty film product we only have a guarantee a two week run, and sometimes only one.  Occasionally if it is a “big” specialty film (like March of the Penguins or Brokeback Mountain), we are pushed to agree to 3 or 4 weeks.  Never more than that. 

6.      What are some examples of successful mixed-use venues, similar to WTMD’s proposal?  Tampa Theatre and the Michigan Theatre are successful, though each is set up as a non-profit and utilizes contributed support to balance their budgets.  Both program film as their core business, but also host educational programs, concerts, and community events.  The Michigan added a second screen several years ago. 

7.      How does clearance work and how big of an issue is it?  Clearance can be a big issue depending on the market.  Clearance basically grants a theatre operator exclusivity over product within a certain radius. The size of the radius is negotiable and varies on the local marketplace.  Clearance is a big deal, especially for competing chain multiplexes.  

8.      Who decides where movies are shown?  Generally, film distributors decide where their films will open.  Film exhibitors are simply jumping up and down shouting, “Over here! Over here!”  In the case of a multi-venue operator, the operator can suggest where he or she would like to open the film, but its still the distributors’ call. 

9.      What is the feasibility of getting donations from private donors (particularly those interested in historic theater renovation and reuse) to cover a portion of the cost of renovations?  There are many examples of restored historic theatres that have been funded largely by private donations.  Many projects have some local, state and federal dollars committed as well.  It should be noted that only a non-profit can really raise money to pay for restoration costs.   A commercial movie operator cannot be expected to successfully raise money.  However, if the Senator’s ownership is vested with a public entity or a non-profit, then tax-deductible contributions can be solicited.  It is entirely possible that a preservation group, non-profit, or public entity could own and restore the theatre, and then contract with a commercial entity to operate the building thereafter. 

 

 

Summary of Questions Related to Capital Improvements and Historic Preservation

Members of the Advisory Panel would like to get a better understanding of how committed Buzz Cusack and WTMD are to restoring the building in a manner that will protect and preserve its key historic features, both on the interior and exterior, and to maintaining the building in the future.   From experts in the field of historic preservation and historic theater restoration, they would like to get a better understanding of what it would cost to restore the Senator.   Both parties are planning to apply for state and federal historic tax credits, so they will have to abide by Secretary of the Interior standards.

 

1.      One of the proposals involves relocating the ladies’ room in order to accommodate the necessary number of stalls and make the restroom ADA-compliant.  Is this necessary?  It may be, but I am not the expert on these matters.  I would consult a preservation architect, perhaps asking for some free advice from the Maryland State Historic Preservation Office. 

2.      What will it take to restore the mural in the lobby, and how much will it cost?  Is cleaning it sufficient?  Cleaning may be sufficient, but I cannot offer advice here either.  You may ask Jeff Greene of Evergreene Studios in NY to provide you with some advice and a budget estimate.  

3.      Questions 10 and 13 below include lists of some of the key feature of the building that have been brought up by at least two members of the Advisory Panel.

 

I hope this helps to some extent.  I did not get into the rest of the document because I am unfamiliar with the specifics, and those specifics seemed to be directed at each of the bidders. 

 

I will say that my gut feeling is that to be viable, the Senator will have to expand, preserving the integrity of the existing structure while adding additional screening rooms, meeting/class rooms, or public amenities.  We operate the Tampa Theatre and need to raise at least 40% of our annual operating budget of $2 million from public and private sources. Our master plan calls for expansion here, too, adding educational spaces, expanded lobbies, and 3 new screening rooms. 

 

I think its great news that the Senator will be brought back to life, and it looks like those involved in evaluating the proposals are asking all the right questions. 

 

If I can provide any additional information, please let me know. 

 

Best regards,

 

 

John Bell

813-274-8679

Tampa Theatre

 

Tampa Theatre:  "One of America's 21 Wonders" -- LIFE magazine, 2007

www.tampatheatre.org