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I was looking to get some feedback and opinions on some cost figures. I am looking at an existing single screen with just under 300 seats. All of the equipment is intact and in good working order it is just seems old. DTS/DOLBY is about 10 years(DTS 3D/Dolby CP45), the projection equipment (Cinemaccina, Simplex XL and Xetron 1600 light housing). Yamaha C320 Amps. Concessions could use some remodeling but the popper is 32oz. Goldmedal and in great shape, ice machine, cabinets, etc.

The building is a lease and have not got all of the details on that yet but just wanted some opinions on the price. They are asking $55k for for all the interior equipment and supplies, projection,sound and seating. The location has not been closed for more than 6 months.

Hello,

The first thing you need to do is ask yourself can this single screen be profitable or not cost you more than you want it to if this will be a hobby. There are very few situations in which a single screen theater can work. You should spend a good deal of time looking over this forum. Min 20 hours.

It is of my opinion, that a single screen may not be worth touching even if it is free.

Clarification: is the theater closed right now? IF so, you need to find out why. This is the busiest time of the year when there is plenty of product available basically to everyone.

Over the past 45 years I have operated 10 single screens, several twins and 3 drive-ins.

One of the twins was inside a shopping mall in which I assumed the lease after a large national chain had given it up. The chain owned the equipment and I had to purchase it from them. This was in the mid 90s. I bought everything for the two screens... booth equipment, concession, box office, auditorium seating, screens, speakers etc. for 10k. It was all in very good condition.

Every one of the single screens were privately owned, and in every case the equipment was owned by the theatre... therefore, the lease included the equipment as well.

When the leasee owns the equipment, it is generally a stipulation in the lease that the equipment must be either removed from the premises by the conclusion of the lease or forfeited to the buildings ownership. The fact that the equipment is still there in a theatre that has been closed for about 6 months raises the question as to who actually owns it. If owned by the previous operator, why is it still there? If owned by the person or company that owns the theatre, then why is it not included in the lease?

55k seems a bit high for used equipment to me.

Please feel free to leave a private message here at big-screenbiz or e-mail me and I'll be willing to discuss the operation of sigle screen theatres with you.

Roxy,

What is your though on operating single screens today?

I just spent time looking at singles in the KC area. Only 3 singles that make their grosses veiwable are playing Twilight-Eclipse (the widest released movie ever). One is a non-profit. 19 other singles have played Iron Man 2 through today, only 5 are for profit.

Thank you for the feedback. I am working on getting more details so I can be more specific as to the terms and conditions etc.

I run a single screen and it is profitable. We have the highest grosses for a single screen in my state. This year we opened How to Train Your Dragon, Iron Man 2, Shrek 4 and we're finishing up Toy Story 3. I think single screens are the right choice under the right circumstances. You're never starved for product in a single screen....

Leeler,

Can you spell out those circumstances?

sure, my theater is in the heart or a rural county. we are the only theater in this county. this is a VERY small and VERY rural county. there are no stoplights in the entire county. a single screen fits in beautifully and it has been profitable for us (although we could always use more ). Would a twin be more profitable? Undoubtedly. Would we ever make up the added costs of buying the property next to us and turning it into another auditorium? I doubt it.....

Ok here is the skinny on the place. I have had a conversation and a walk through with the original owners. It goes like this: They owned and operated the business successfully from 1970s to 2006. They decided to sell as they were getting up there in age and they decided it was time to let it go (family not interested in taking over). He sold the business to someone and it ended up poorly managed for the last 4 years. He had a payment schedule with the buyer for the sale of the business. Now approx. April of 2010 they got shut down as newer owner was not paying the bills to either the landlord or the original owner. LLC went belly up. So the landlord still being a friend of the first owner allowed him to claim the equipment and reopen the place etc. But still being quite old (late 70s i think) he still wants to sell it off. So he and the landlord worked it out to sell the equipment and try to lease it out.



Sorry for the long post

Price too high IMHO for the equipment with future digital conversion out there.

I would suggest a 6 mo lease to give it a try. Use of the equipment for a min. fee. What kinda of lease payment are we talking about?

BTW, not a long post at all.

Did a little research on the before mentioned single screens: only 3 have grossed more than $70,000 the past year.
Theeater A: 6000 population, closest 3d screen at a twin 38 miles away, no plex 6 or bigger within 60 miles, grossed over 90k
Theater B: 9000 population, closest 3d screen and 6-plex+ 49 miles, grossed over $70k
Theater C: 4400 population, closest 3d screen & 5-plex 30 miles, grossed over $80k

The rest were less than $30k.

I have not yet had a chance to speak to the landlord in person. The previous owner says he is looking to get 1300 for rent and not sure what the 3N might be but thinks the #s are negotiable because the theater was thought of as a draw to other businesses there in the plaza. The owner seemed more or less just concerned about getting the remainder of what he is owed and cutting himself free from the business and said he would rather have it go to someone who can revive it that to have it just remain shut down. So I think there is room for negotiation. The concessions would need a remodel and some automation (thinking RTS or similar). But I think with some effort to actually make it worth while. They were only showing 1 show a night regardless of the day note sure if that was 7 days or not.

rufusjack wrote:

Is that a monthly figure?

Those numbers are yearly ticket grosses. These theaters probably average $6 per ticket and per cap. of $2.75 -$3. Seem to be seasonal first-run so probably pay 50% in film rental, run COGS of 35%. So my guess would be gross profit of $60-76k per year. So you need to pay for all of your other expenses out of that: lease, labor, insurance, utilities, advertsing.

Now those are the good grossing singles. I would think you would have to gross at $50k per year in ticket sales to break even with your operating expenses assuming it was a labor of love (meaning you work it for very little $$).

I am not too excited about this.

Two other singles that I am aware of in Illinois that I believe do pretty well (meaning they are profitable): Theater A: 3000 population with nearest multi/3d 33 miles away & Theater B: 5600 population and with neareast multi/3d 34 miles away. Both are seasonal first-run.