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Author Topic: Is second run still viable?
Sean McKinnon
Phenomenal Film Handler

Posts: 1712
From: Peabody Massachusetts
Registered: Sep 2000


 - posted 03-25-2013 03:26 PM      Profile for Sean McKinnon   Author's Homepage   Email Sean McKinnon   Send New Private Message       Edit/Delete Post 
I have been wondering if second run or "dollar" theaters are still a viable business model these days?

I heard of someone being interested in trying to lease a closed 8 screen in a "dead" mall and try to go sub run with dlp. I was thinking that this is a crazy idea and am curious if I am wrong?

In addition to that is there even any "used" digital machines on the market? I think this person's plan was to save money by buying used digital projectors but I don't think there is such a thing.

Thoughts, comments?

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Aaron Garman
Phenomenal Film Handler

Posts: 1470
From: Toledo, OH USA
Registered: Mar 2003


 - posted 03-25-2013 03:38 PM      Profile for Aaron Garman   Email Aaron Garman   Send New Private Message       Edit/Delete Post 
Our local discount house still seems to have business. In fact, they're still showing Wreck it Ralph despite already being on video. They must be making money.

I think digital could make it easier for one to run a discount. Sure, up front costs will be high but after that, it's all automated. Find the right market, and it will work.

AJG

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Jason McMillan
Film Handler

Posts: 68
From: Houston, TX, USA
Registered: Dec 2009


 - posted 03-25-2013 04:20 PM      Profile for Jason McMillan   Email Jason McMillan   Send New Private Message       Edit/Delete Post 
I've close ties to one of the three sub-run venues here in Houston, TX. They're upgrading to digital in the next couple of weeks... My understanding is they're going to be installing Barco projectors, Master Image 3D in two auditoriums, and completely re-doing the sound systems (although as old as the current Ultra Stereo processors are, this is kinda a necessity).

If I had to make a guess on the sound systems, I'm betting they go with some sort of Ultra Stereo processor (JS200, I assume) with the USL DAX-602. They are, however, trading the old Peavy CS400 amps for Crown -- can't beat that.

The theatre still does plenty of business for its size -- enough to justify new air handlers, new building signage, remodeled restrooms, remodeled concession stand, and of course the equipment for the digital upgrade.

The new Eprad eCNA10 automations and CLD-2K dimmers just arrived the other day, actually. Was the first equipment to show up.

Sad to say, its going to be better for the theatre because it's been tough to keep a booth staff (and honestly the booth staff thats there couldnt care less about film, its just a paycheck to them), and the labor hours spent with someone upstairs can now be used to keep an extra doorman on the floor cleaning.

You'd be surprised just how many people want to have a birthday party there for their kids, or schools wanting to arrange showings ... and buy kids packs. Cha-ching.

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Edward Havens
Jedi Master Film Handler

Posts: 614
From: Los Angeles, CA
Registered: Mar 2008


 - posted 03-25-2013 04:20 PM      Profile for Edward Havens   Email Edward Havens   Send New Private Message       Edit/Delete Post 
There should be used digital equipment out there by now. I'm vaguely remembering Barco themselves putting some used DP-2000s on sale a couple years ago.

As for "dollar houses" in a digital age, I'm surprised it hasn't happened that much yet, although as a former dollar house manager in the late 1980s and early 1990s, I believe they best work with two to four screens, with double features or day/night split screens bringing in the best mix of guests.

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Jason McMillan
Film Handler

Posts: 68
From: Houston, TX, USA
Registered: Dec 2009


 - posted 03-25-2013 04:36 PM      Profile for Jason McMillan   Email Jason McMillan   Send New Private Message       Edit/Delete Post 
I'm also pretty sure Cinemark's 16 screen sub-run in San Antonio, TX is all digital, too...

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Christopher Crouch
Expert Film Handler

Posts: 128
From: Holywood, ca, usa
Registered: May 2006


 - posted 03-26-2013 02:38 AM      Profile for Christopher Crouch   Email Christopher Crouch       Edit/Delete Post 
I'm employed by a chain which currently operates eleven of it's theatres under a subrun model and all are quite profitable. Seven of these theatres were converted to digital back in 2010-2011 (profitable enough for new NEC & Barco, not used) and an eighth location is currently in the process of being converted. In the right market, subrun remains more than viable.

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Sean McKinnon
Phenomenal Film Handler

Posts: 1712
From: Peabody Massachusetts
Registered: Sep 2000


 - posted 03-26-2013 01:55 PM      Profile for Sean McKinnon   Author's Homepage   Email Sean McKinnon   Send New Private Message       Edit/Delete Post 
How long will 35mm prints be available for sub run houses? I am.told that it would cost 50-100k per screen to do a digital installation from scratch. I think the previous operator took everything out of this location when they left. It is 8 screens and I don't think there is the financing for an $800,000 projection and sound install.

Would it be feasible to start with 35mm and try to convert one house every six months or so or is it way too late for that? When will 35mm prints cease to be struck all together?

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Scott Norwood
Film God

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From: Boston, MA. USA (1774.21 miles northeast of Dallas)
Registered: Jun 99


 - posted 03-26-2013 02:38 PM      Profile for Scott Norwood   Author's Homepage   Email Scott Norwood   Send New Private Message       Edit/Delete Post 
Personally, I would stay the hell away from any sort of "dead mall" location unless there were an amazing lease deal and the landlord had plans to bring in other tenants as well in order to revive the location. People avoid dead malls, they attract crime, and are generally bad news for the community.

A nice theatre could potentially help to improve a location like this, but, again, there would have to be a sweetheart lease deal and property improvements (including seat refurbishment/replacement and new/upgraded projection and sound equipment) to make it worthwhile. I don't see the point of installing 35mm equipment in a mainstream theatre at this point. If it were already in place, it could be used for now (of course), but the direction of the industry is clear. I would not spend money to install it, however, unless I had plans for repertory programming or special events, neither of which would likely apply to a mall theatre.

Late-run films would be the least of the problems for a location like this. I do think that the market for cheap tickets exists (at least in some markets), but not in a dumpy location that is being run on a shoestring.

I have been in a few dead malls, and the overall feeling of those places is really creepy. Lots of open space filled with boarded-up storefronts, maybe with a shoe store or drug store or something (there is _always_ a Radio Shack in these places for some reason) still open, and just a handful of people in the entire structure. This is not the sort of place where I would want to go for an evening's entertainment.

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Sean McKinnon
Phenomenal Film Handler

Posts: 1712
From: Peabody Massachusetts
Registered: Sep 2000


 - posted 03-26-2013 03:15 PM      Profile for Sean McKinnon   Author's Homepage   Email Sean McKinnon   Send New Private Message       Edit/Delete Post 
That's pretty much how I feel Scott. Are you familiar with the new harbor mall in Fall River? (edit: i see you are you took the pictures on cinematour) A former co worker/friend of mine contacted me and has this crazy idea on trying to reopen this place. He has some money but no where near enough and wants me to invest with him as partners. I told him that I thought it was a bad idea but that I would think it over. As much as I have always wanted to be a theatre owner I just cannot see this as a winner. I was able start my last business three years ago for about the low end of what it would take to install digital on one screen and tripled my size and am looking at 2 mil in revenue this year. I cannot see putting almost a million dollars into a long closed location In a dead mall.

I think I have to let this one pass me by unfortunately.

New Harbour Mall

Picture 8 shows the entrance to the theatre when it was a Loews

Here it is on cinematreasures

It sais its open but it is not.

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Mike Croaro
Master Film Handler

Posts: 394
From: Millbrae, CA
Registered: Apr 2005


 - posted 03-26-2013 07:06 PM      Profile for Mike Croaro   Email Mike Croaro   Send New Private Message       Edit/Delete Post 
Greetings:

What kinds of prices are "sub-runs" charging these days? Used to be that you had to charge at least 1/2 of the the first run theatres in your area were charghing to be considered sub-run. If you charged less, you wre considered "discount/2nd run"

Is is still the case? Has DVD affected this?

Mike

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Andrew Thomas
Master Film Handler

Posts: 273
From: Pearland, TX, USA
Registered: Jun 2012


 - posted 03-26-2013 11:28 PM      Profile for Andrew Thomas   Email Andrew Thomas   Send New Private Message       Edit/Delete Post 
quote: Jason McMillan
I've close ties to one of the three sub-run venues here in Houston, TX. They're upgrading to digital in the next couple of weeks... My understanding is they're going to be installing Barco projectors, Master Image 3D in two auditoriums, and completely re-doing the sound systems (although as old as the current Ultra Stereo processors are, this is kinda a necessity).
I'm assuming this in the Premiere in Webster based off of your description. Gary Moore runs an interesting chain. He used to take over dumpy theaters and run them on a shoestring budget but now has put together a very nice circuit. Too bad his 6 screen in Pearland is so disgusting. Hoping he puts some money into renovating that space now that he has installed the Barcos as of May 2012. Ripped up chairs, curtains, and what not.

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Michael McGovern
Film Handler

Posts: 57
From: New Britain, CT, USA
Registered: May 2008


 - posted 03-27-2013 12:25 AM      Profile for Michael McGovern     Send New Private Message       Edit/Delete Post 
It all boils down to the rent. You can do all the business in the world, but if your landlord is sucking you dry every month, it won't matter.

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Brian DeCiancio
Film Handler

Posts: 52
From: Warren, OH, USA
Registered: Sep 2002


 - posted 03-27-2013 10:22 AM      Profile for Brian DeCiancio   Author's Homepage   Email Brian DeCiancio   Send New Private Message       Edit/Delete Post 
A partner and I took over a 6 screen sub-run house in November--technically an intermediate as we can play immediately after the local 14 screen Regal has finished its run.

It is a viable theatre for our market, and in fact, Cinemark has an 8 screen discount house 25 minutes away that does extremely well.

Yes, we are converting to digital.

And yes, there is used equipment out there. But it's a small market. When you find the equipment, you need to have the money ready to purchase it, as there are plenty of people looking to save money over buying new.

The considerations are as mentioned above--the local market, the condition and occupancy rate of the shopping center it's located in, and securing a favorable lease.

If you are looking to pocket 6 figures a year, move on. If you enjoy the business, plan on working it at least to some extent and are satisfied with a reasonable return, pursue it.

Shopping centers do not like to have empty theaters and are reticent to invest a huge amount of money to reconfigure the space for typical retail. You may be surprised at the terms you can agree upon. The landlord would not only have to fill in the floor (assuming it's sloped), the mezzanine of the projection booth is, more often than not, a load-bearing wall.

The frontage of a theatre in a plaza or mall is significantly less than what the auditoriums take up. They may have difficulty splitting up the single store front to provide multiple retail outlets feasible frontage versus what lies behind. Those stores end up being essentially a "hallway" leading to nice-sized floor space.

As of this post, we are beginning to feel the squeeze of print shortages. We've had a couple of last minute bookings when "a print suddenly became available".

IMO, don't even consider re-opening or taking one over without a plan to begin converting ASAP.

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Bobby Henderson
"Ask me about Trajan."

Posts: 10973
From: Lawton, OK, USA
Registered: Apr 2001


 - posted 03-27-2013 10:38 AM      Profile for Bobby Henderson   Email Bobby Henderson   Send New Private Message       Edit/Delete Post 
All the right variables need to be in place for a sub-run theater to make the expense of buying & maintaining digital projection equipment viable.

Customer demand and demographics are crucial. For instance, it takes enough of a considerably different crowd in order for a theater to show movies that are either fixing to be released on home video or already available on home video.

I'm not optimistic the Vaska Theater here in Lawton will survive. It's a single screen house in need of many upgrades. And that's not including the need for a digital projection system. Fort Sill stopped showing movies at their post theater this past December, and that theater was in considerably better shape.

I was told the folks running the Vaska are actively searching for used digital projection equipment. But finding an acceptable used projector is only one part of a d-cinema conversion.

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Jason McMillan
Film Handler

Posts: 68
From: Houston, TX, USA
Registered: Dec 2009


 - posted 03-27-2013 02:04 PM      Profile for Jason McMillan   Email Jason McMillan   Send New Private Message       Edit/Delete Post 
quote: Andrew Thomas
I'm assuming this in the Premiere in Webster based off of your description.
Of the three sub-run venues in Houston -- North Oaks Cinema 6, Wind Chimes Cinema 8, and Premiere NASA 8 -- it is one of those, yes. Since I don't officially work for any of those cinemas in any capacity, I wouldn't want to cause any waves.

quote: Andrew Thomas
Too bad his 6 screen in Pearland is so disgusting.
Having myself previously worked for AMC and Landmark Theatres, I've been in a lot of theatres in this city, but this is one I have not been in and unfortunately am not able to comment one way or another.

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