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TOPIC: Building a theatre

Building a theatre 06 Apr 2005 03:22 #28856

  • jacker5
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I was looking in an area for a theater and a Realtor said he was talking with a prospective partner to buy a site... a building ... where a movie house could be located. Then I could refit the inside of the building for a movie theater?
What should I be asking and look out for in partner I don't know!
I am weary about this, I am right or is this a good way into getting my theater. I was thinking of just buying building myself and doing the renovations but that may be costly.
I am facing a dilemma! Thanks for your help guys!
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Re: Building a theatre 06 Apr 2005 10:18 #28857

  • jimor
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Jacker, you do have a difficult decision in front of you, and a few words here may not make it that much easier. You are right to be wary of the whole venture, but especially of a partner that you do not know well. Some people mistakenly think that a good contract between the partners will protect them in case the other guy is a stinker, but in reality, a contract is only as good as your ability to enforce it, and the quality/quantity of the “repairs” that are available in the form of such as his funds should the contract be breached. Obviously, if it costs you lawyer’s fees in the tens or hundreds of thousands to enforce the contract, it is not likely that you yourself will see any remedies in the form of cash. The same is true if the partner really does not have the funds or liquefiable assets that you thought he had; in such a case, even if you win, you lose.

Few existing buildings lend themselves well to becoming cinemas, usually because of low ceilings and poor traffic patterns for safe exiting of the audience. If you are rightfully wary of a non-theatrical building, you would do well to hire a theatre/cinema consultant who has no discernable connection to any builder/remodeled/contractor and ask him if a site can be converted and for how much. You must do your due diligence in searching out the real history of the consultant and any builder/contractor he recommends. Even if you don’t confront sharpies skilled at parting people from their money, you will still confront ‘experts’ and builders who prefer to look at things through rose colored glasses, since it is not their money at risk. Have you done an entire demographic study of the area to determine marketability? If not, you may be putting the cart before the horse, since the building is an afterthought in this area.

Starting from scratch, and risking only your own funds is the most risky approach, but it also gives you some peace of mind in that you will not be in hock to a bank, and you will not worry about waking some morning to find that your partner has left for Brazil with all the firm’s money leaving you high and very dry. If I had at least a half million to risk on new construction in an area where I am convinced that there will be a good pay off, then I would go the sole proprietor route at first, but if I did not have such money I would be very wary about trusting others to come through for me. Remember, NO ONE will ever really have your interests at heart but you. It boils down to ‘how much can you stand to lose?’
Jim R. (new E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it ) member: www.HistoricTheatres.org
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