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Comment by viraptor | Hacker News Reader

This one is really interesting to me since it's an extreme case (due to the building structure) of "if they leave, what's your plan for that space, exactly?". Could they survive by firing lots of people and basically hibernating for a few months / a year?

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I wouldn't be surprised if in a couple of years there will be a lot of suspiciously-cinema-shaped gyms and family play centers everywhere.

There are already many cinema shaped Bingo halls in the UK.

And at least one Weatherspoons (chain pub). Sad when that one shut down - though it's possible the new multiplex had the same owners.

This one went through quite a few changes! cinema->glass factory->storage warehouse->bingo hall->snooker club->restaurant->cinema

http://cinematreasures.org/theaters/16613

Neither of those are sparkling businesses during the pandemic

They don’t have to be. The buildings will still be there, it’s the debt securing them (and equity, depending on the capital structure) that’ll eat the losses until they’re repurposed at some point in the future.

Assuming they’re secured and maintained enough to avoid vandalism and damage. Once water/mold start getting into abandoned buildings there’s only one option left eventually.

Odeon Cinemas have been experimenting with operating as Nightingale Courts. I don't think this gives them nearly enough money to stay alive, especially seeing the poor condition of existing court buildings in the UK.

https://planetradio.co.uk/borders/local/news/jurors-at-the-m...

https://www.societyofeditors.org/soe_news/uk-trials-conducte...

My ex-employer bought a cinema and are planning to knock it down and build an office on the site[1]. I left before hearing any plans about it, not sure if they always planned to knock it down or somehow convert it.

[1] https://www.bbc.co.uk/news/uk-northern-ireland-52813604

They won't be able to service their debt.

Long-term debt would indeed be a problem. I would think it'd be unlikely they could go back to the markets & put up additional shares for sale, since investors would want some assurance that patrons will return to theaters once the pandemic restrictions have been eased. [0]

Whether they can pay their operational debt (rent, utilities & property taxes mostly, since they won't be paying employees or suppliers) would depend on their cash balance. Eight months into this, and their cash has got to be running pretty low.

[0] I for one will not. I wasn't happy with the megaplex movie-going experience anyway, and there isn't an Alamo Drafthouse in Charlotte.

Long-term debt is going to be the ultimate problem. Commercial property is already looking very rocky, and it's going to have its 2008 moment within 18 months or so.

IMO this is a major social shift, not a temporary distraction from business as usual.

I’ve seen a few repurposed as comedy clubs. Ironically brings them closer to their original role as proper theatres.

You don’t get the all-day money making you do with a cinema (though plenty of daytime screenings are very empty) but you can serve booze and proper food, so there’s a middle ground of profit to be had, I suppose.

Stand-up comedy doesn't have a fraction of the audience, sadly, and many cinemas already serve booze and proper food, even going as far as to-your-seat-service. Everything is ruined, isn't it?

A ton of these are like 10-20 screen locations I imagine. Would be a hell of a comedy club

Yeah I think the giant out of town multiplexes are screwed. But they’re probably also a lot cheaper to redevelop into something totally different.

How do you pay your debts while hibernating?

You take on new debts and try to persuade creditors you'll be paying them off real soon now.

This isn't snark - it's literally the new normal in many sectors.

Yeah, if the creditor has a choice between (maybe) getting paid at some point in the future or definitely not getting paid at all, some will opt for the maybe.

It would be different if they could resell the property, but in a market where no one is buying, it's a different story.

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