Hemorrhaging up to $30,000/week. Will theaters survive coronavirus?

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Laemmle Theatres Playhouse 7 in Pasadena, California, a theater that shows many independent films. Photo credit: Dreamyshade/Wikicommons

The coronavirus has upended day-to-day life and paralyzed small businesses. People usually turn to movie theaters to escape from stress and hardships. But now theaters are closed due to COVID19.

“Over the years, I've kind of planned for …  a rainy day,” says Lance Alspaugh, owner of the Vista and Los Feliz 3 theaters. “Well, the rainy day has come.” 

The Vista has been a fixture on Sunset Boulevard for nearly 97 years. Alspaugh is optimistic he’ll hit the centennial and many more years – but admits he and his employees are anxious. 

“We're taking it as a week-by-week thing.  … Once those tactics are exhausted, we'll see what we do next.”

Greg Laemmle, the owner of the Laemmle chain of theaters, says his eight theaters are hurting. 

“We're hemorrhaging ... probably in the order of $20,000 - $30,000 a week, plus.”

He says he’s had to cut his staff from around 200 to two and a half employees.

“The art house had a rough year last year,” Laemmle says. “We were up for sale. We were expecting a bit of a bounce-back this year. This kind of puts a pressure on that.” 

He thinks his theater chain could survive if they open by Memorial Day.

Relief could come soon though. 

There is an industry trade group called the National Association of Theater Owners, which lobbies the government in Washington. They’ve asked for a bailout. That would guarantee loans and tax benefits (among other helpful relief) to stay afloat and bounce back after this. 

But some smaller theater owners aren’t so certain their art houses would benefit from a bailout like that.

Peter Ambrosio, co-owner of the Lumiere Music Hall in Beverly Hills, says he’s been in contact with the Small Business Association for relief loans due to his uncertainty of benefitting from the proposed bailout. 

Until that happens, he’s relying on gift card sales and clientele memberships. 

“I think we could make it to June, potentially,” Ambrosio says.

But all hope isn’t completely lost. Theaters and distributors are getting creative. 

Alison Kozberg, managing director of the Art House Convergence, a nationwide organization of independent specialty and repertory theaters, helped facilitate partnerships with distributors to assist these mom and pop theaters with virtual cinema screenings.

“The art house you love sells tickets through their website,” Kozberh explains. “And you gain access to a film that is not available on any other streaming platform to watch from the privacy of your home. A certain percentage of ticket sales is dedicated back to that theater.” 

While these methods may keep theaters afloat in the interim, will people go back after a pandemic? 

Owners say they’ll adhere to CDC guidelines and may take extra measures to protect customers in the way supermarkets have, such as holding special hours or screenings for senior citizens. 

Aside from health concerns, theaters have to deal with supply chain problems too. Laemmle says theaters can’t just immediately open again as other businesses can. Hollywood is shut down too, after all.

“[Studios] are nervous about doing the advance work of promoting a film and all the expenditure that goes into that without the certainty that that date is going to stick,” Laemmle says. “We don't know which films we're going to play.” 

Though this is just the latest Sword of Damocles to hang over the heads of theater owners, they’re positive they’ll come back from this. 

Alspaugh sums it up best: “I do think people will come back. And I think things will rebound. People will be very happy once we all get the green light that things are going to get better. ... The best thing I can call it is a ‘hallelujah moment.’ But I think people are going to return to the movies. I truly do.  

There's just nothing like seeing a room full of 350 strangers that no one's ever met. They're all sitting there watching a movie on a screen. They're there crying together, laughing together, being scared together. It's just no experience like that.”

To help your local theater, contact them. Support them by buying gift cards, signing up for a membership, and engaging in virtual screenings.