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It's Curtains for Some Edwards Theaters

Movies: The chain is trying to get rid of about 25 aging cinemas that aren't drawing the crowds that multiplexes do.

March 10, 2000|LESLIE EARNEST | TIMES STAFF WRITER

Edwards Theatres Circuit Inc., Orange County's largest movie house operator, said Thursday it is trying to unload about 25 aging theaters that moviegoers are shunning in favor of flashier mega-plexes.

The Newport Beach-based chain has hired a Beverly Hills law firm to help it revise or discontinue leases for some of the outdated theaters, which were built in the 1960s and 1970s. In Orange County, 16 theaters with 76 screens are expected to close. The other targeted theaters are in Riverside and San Bernardino counties.

The move reflects an industrywide trend toward building grander, multiscreen theaters, which often anchor large shopping and entertainment centers, such as the 21-screen theater at Irvine Spectrum Center and the 30-screen AMC cinema at the Block at Orange.

Theatergoers are increasingly flocking to the more upscale properties with stadium seating and top quality sound systems, said Gregory Stoffel, whose Irvine consulting firm, Gregory Stoffel & Associates, conducted a nationwide study on the trend last year.

In areas where multiplexes opened, "it was almost always at the expense of the older, smaller theaters," Stoffel said. "Landlords that have older movie theaters should consider this a wake-up call."

Edwards wants to close small theaters that lack modern touches, including cushy seats with cup holders in the arm rests, Chief Executive James Edwards III said. While he declined to name which theaters will likely be shuttered, he did say the weary, single-screen Edwards Cinema on Adams Avenue near Harbor Boulevard in Costa Mesa will close, probably within a month.

"These theaters are obsolete by today's standards as far as design and lack of amenities [that] people like today," he said. "We're building new, state-of-the-art luxury entertainment centers, and, as we do, the older, obsolete theaters will fade away, one way or another."

To help shed the aging cinemas, Edwards hired Stutman Treister & Glatt, a high-profile law firm that specializes in bankruptcies. But Edwards said the theater operator is not in any financial distress and does not intend to file for Chapter 11 bankruptcy protection to get out of its leases. The company selected the law firm because its attorneys have expertise in leasing, he said. Edwards declined to discuss details of the leases.

But Leonard Shulman, an attorney with the Irvine bankruptcy firm Marshack Shulman Hodges & Friedman, said it is a smart move on Edwards' part to hire the Beverly Hills firm. Because the bankruptcy code limits the amount of money a landlord can recover when a lease is broken, just raising the specter of bankruptcy could persuade a landlord to renegotiate, he said.

"You're sending a message to other parties you are dealing with that there is a possible threat of filing a Chapter 11," he said.

Edwards said the movie operator is continuing to pay rent on its properties and called it ridiculous to believe the company would consider filing for bankruptcy.

"We are repositioning Orange County for the future," he said.

In its push to satisfy moviegoers, Edwards is expanding existing high-profile mega-plexes such as the 21-screen Irvine Spectrum cinema, which is scheduled to get four more big screens this fall. But Edwards also is bucking the trend, modernizing smaller theaters at some prime locations.

The three-screen theater on Bristol Street across from South Coast Plaza is being transformed into an Edwards Palace Theatre with one screen at least 65 feet wide, rivaling the largest regular movie screen in Orange County. The theater may even serve light meals, the company said.

Edwards has added 75 screens in Orange County over the past five years as it has upgraded older movie houses and built mega-plexes. Currently, Edwards operates 90 movie theaters with 850 screens, most of them in California. In the future, the company is likely to have fewer theaters and more screens, Edwards said.

And the company will not close any of its so-called art houses, smaller theaters that show specialty films, Edwards said.

These theaters still draw movie lovers, who will trade creature comforts to see an offbeat or foreign film, Stoffel said.

At the now-closed Port theater in Corona del Mar, for example, locals would buy tickets even on rainy days, when a leaky roof dripped water inside the theater.

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