Kansas City area movie theaters aim to reopen amid COVID-19. Get ready for big change
If the story of the nation’s movie houses, like those run by Leawood-based AMC Theatres or Liberty-based B&B Theatres, were, itself, a movie — right now it would be a horror flick.
Theaters dark. No one around. An unseen specter looms.
COVID-19 has stilled projectors and frozen the theatrical release of all new major movies as if they were The Thing encased in ice. Only recently were theaters in the Kansas City area allowed to reopen. But the next major Hollywood release, the Russell Crowe thriller “Unhinged,” won’t open until July 1, and director Christopher Nolan’s “Tenet” is set for July 17.
Everyone is spooked about what lies around the corner.
Will coronavirus infections resurge, followed by renewed fears, walloping movie houses just as they regain their footing?
In a world wracked by COVID-19, will people even feel comfortable going to the movies again?
Already for theater owners, the impact of closures since mid-March has been their own version of “The Day the Earth Stood Still.”
“I mean, as an industry, in 100 years, we’ve never had to shut down completely, ever,” said Brock Bagby, executive vice president of B&B Theatres, and a descendant of the Bills and Bagby families that started the chain in 1924. The company operates 500 screens in 50 theaters in seven states, including 10 in the Kansas City area.
“I mean, we’ve had some hurricanes that closed a couple theaters for a couple of weeks,” Bagby said. “We’ve had tornadoes. But we’ve never had our entire circuit, or, of course, the entire industry shut down ever. It’s been truly devastating because we went to completely zero income.”
Scary movies
This week a Morning Consult poll of some 2,200 people tracked how comfortable they are, amid COVID-19, at returning to nine activities: going to movies, gyms, parks, concerts, malls, museums, vacations, eating out or traveling abroad.
All numbers ticked up from April, but overall were low — ranging from 23% for those who say they are comfortable going out to eat or on vacation to 10% feeling comfortable enough to travel abroad.
Returning to indoor movie theaters sat at 16%, up from 12% in April, which The National Association of Theatre Owners sees as a positive trend. (Politically, 23% of Republicans said they felt comfortable going back to the movies compared to 14% of independents and 12% of Democrats. Millennials, at 22%, were double the baby boomers at 11%.)
But owners know that overall, 84% of those polled do not yet feel comfortable returning to movie theaters, which have now been allowed to open in 20 states so far.
In the past week, local governments have eased restrictions: Johnson County made its recommendations voluntary, for example. Kansas City and Jackson County will allow businesses to operate at 50% capacity.
That permission aside, theaters have largely remained shut and likely will stay that way through June.
AMC, which was struggling financially with debt even before COVID-19, controls more than a quarter of the nation’s 40,000 indoor movie screens. A company spokesman declined to say when they plan to reopen screens, but the AMC website touts the release of “Unhinged” and “Tenet” in July.
In an investors April conference call, Cinemark’s chief executive officer, Mark Zoradi, said they, too, are looking at opening their more than 4,600 screens in the U.S. (more than 6,000 worldwide) in early July, including the location in Merriam. (Its Country Club Plaza theater closed last year.)
B&B Theatres are open but only for small groups of no more than 20 people who want to book a private auditorium to watch a movie on a big screen, what Bagby called “retro” movies or past runs that include “Goonies,” “Raiders of the Lost Ark,” “Ferris Bueller’s Day Off,” “Mean Girls,” “Grease,” “Wonder Woman” or any of the Harry Potter movies. Otherwise, they, too, won’t start reopening until the middle of June, with all 50 theaters open by mid-July.
The reason isn’t that theaters can’t be ready sooner. It’s that the movies aren’t ready.
When COVID-19 shut down theaters, Hollywood naturally shut down its flow of new films, delaying such blockbusters as Marvel’s “Black Widow” and the James Bond thriller “No Time to Die” until fall, and many more, such as Paul Rudd’s “Ghostbusters: Afterlife” and “F9” of the “Fast and Furious” franchise, until next year.
Or they’ve already been made available for online streaming, often through the movie houses, which split the profits to bring in even a little money.
“We either have to show retro right now, or we have to show what was playing when the pandemic happened,” Bagby said. “No one really feels like they can play retro for six or seven weeks. It’s just not going to work. But we think we can do it for two or three weeks.”
Everything was on hold, so there aren’t any new movies to play,” said Brian Mossman, owner of Fine Arts Theatres, which include the Glenwood Arts and Rio theaters in Overland Park.
Mossman has six screens, five at the Glenwood Arts, relying mostly on art and independent films, and a single screen, with 500 seats, at the Rio. Those, too, have remained shut and will until fresh films become available as July arrives.
“It’s just kind of my hunch that people want to see new stuff,” he said.
‘Tenet’ tension
It’s more than a hunch.
Mark McSparin owns 15 VIP Cinemas in several states, including two in Kansas, the VIP McPherson 4 and the VIP Majestic 4 in Concordia, and two in Missouri, the Lake West Cinemas in Gravois Mills and the VIP Cannonball 6 in Lexington.
He reopened his Missouri theaters on May 15 and his Kansas theaters on May 23, playing older material.
He’s charging $4 a ticket. Business?
“Pretty dismal,” said McSparin, of Charleston, Illinois. “It’s dismal because I’ve got no new product. It’s like a restaurant without food. You can open, but if you don’t have stuff to serve people, you’re not going to do very well.”
He opened knowing that hardly anyone would show up, too few to account for the costs of operation. But he wanted to keep the equipment running and theaters fresh and get people used to the idea that movie theaters will be open again.
“Better to have our buildings open and operating and being air conditioned, to have people in them, than to sit there being stagnant,” he said.
Until this week, most of the movies he had — Ben Affleck’s “The Way Back,” “Trolls World Tour,” “The Invisible Man” — had all been released in March or April, and long ago had gone to video on demand. He’s currently open only on weekends. Attendance is four or five customers per movie.
“There’s not much trouble social distancing,” he joked.
But on Friday, McSparin started showing a new release, “The High Note,” a comedy/romance with Tracee Ellis Ross and Dakota Johnson centered on a superstar singer and her assistant in the Los Angeles music scene. It’s hardly expected to be a blockbuster. It’s also available online. McSparin hopes to pull in 50 people.
Because he operates in small towns, with lower rents, he figures he can survive running at 25% to 30% occupancy. (Currently, he’s at about 5%.) Even in normal times, he doesn’t often run more than 50%. The idea is to keep his theaters going until new material arrives.
“We’re just biding time and treading water until we hit July,” McSparin said.
Movie houses in hardest hit cities, such as New York City, or even parts of Los Angeles, may not all be open by July. But the expectation is the vast majority of theaters nationwide will — barring a resurgence of the coronavirus that forces another shutdown.
The key is the movie “Tenet” and its July 17 release.
“Everyone, the whole industry’s got eyes on that movie and eyes on Warner Bros.,” Bagby said. “The biggest fear is that if Warner Bros. holds ‘Tenet’ back, then Disney will move ‘Mulan.’ And then it just spirals. And then God knows how long before we get a first-run title.”
As currently scheduled, the live-action “Mulan,” delayed from March, will open July 24, “The SpongeBob Movie: Sponge on the Run” is set for Aug. 7; “Wonder Woman 1984,” originally scheduled for June, is set for Aug. 12.
Safe house
Once screens are open again, going to the movies is certain to be different.
“People are going to be cautious,” Mossman said. “Those who like movies are still going to come back. I think the people who do it once in a great while, they’re going to think twice before going into a room with a whole bunch of strangers.
“My biggest fear, the biggest hurdle, will be getting the trust back from the customer. If they feel safe, they are going to come back.”
To that end, movie goers should expect to see significant changes: concession stand workers and ushers in masks; Plexiglas sneeze guards at the concession stands; sanitizing stations around theaters. Some theaters will be pushing online ticket sales and the use of cellphone QR code readers to cut down on contact with ticket takers.
The Hollywood Reporter this week cited an Atom Tickets poll of 1,500 that said 25% would return to the movies now, 34% in a month, 18% in two months. Some 42% said spaced seating was key, followed by extra sanitary measures, 21%, and guests and staff wearing masks, 14%.
Packed movie theaters will be a thing of the past, owners said, perhaps for months or longer, or until a viable coronavirus treatment or vaccine is developed.
The Glenwood Arts seats 1,100 people in its five auditoriums. Mossman plans to rope off every other aisle, cutting capacity to 50%. Customers not in the same party will be seated six feet apart, with seats between them. Many shows are likely to feel empty.
“I think if we can get over 100 people, that’s going to be a positive note,” he said. “That’s only 20 people at each screen.”
Bagby’s B&B theaters have home theater seating. Capacity will also be cut in half. His theaters are using an algorithm. As soon as a seat or block of seats is purchased online, the two adjacent seats on each side will be left empty. Instead of filling every other aisle, customers will be seated in a staggered pattern.
“It’s kind of like a checkerboard effect,” Bagby said. “They won’t be directly in front of you, but they’ll be in front of you, though to the right or to the left.”
Theaters that typically have five daily showings of a film are likely to have four, to allow staff more time to sanitize seats and surfaces between shows.
Concession lines are problematic. If social distancing is adhered to, a line of 10 people would stretch 60 feet, too long for theaters with smaller lobbies. Some theaters are discussing advance ordering, having concessions ready for pickup as customers arrive.
Social distancing in the concession lines, Mossman said, is likely to cut back on profits.
“Concessions are where theaters make their money,” he said. “You’re probably only going to do a fraction of what you used to do. If you were doing $3 to $5 a head, you’re probably, at best, you’re going to do half of that or less.”
The color of money
The question looming over many movie theaters is, given reduced numbers at reopening, how long can they survive?
In 2019, movie theaters brought in $11 billion in box office revenue, another $4 billion in concessions. For two months, revenue at the nation’s nearly 5,800 theaters has gone to zero.
“We’re hearing that 10% of theaters won’t reopen,” Bagby said, “Which is between 400 to 600 theaters nationwide.”
Worries have long swirled around AMC, which in March closed its 600 theaters and furloughed 400 employees at its Leawood offices, including its CEO. Having staved off bankruptcy, the company’s stock price rose from about $2 a share after the COVID-19 shutdown to, on Friday, around $5.20 a share. But in up-and-down fashion, it has been declining for years from its high of $33 at the start of 2017.
AMC’s decline, McSparin said, would not be good for anyone.
“We need AMC so film companies have an outlet to show their movies,” he said.
Cinemark’s stock has also dropped because of COVID-19. Trading for years between $30 and $45, it plummeted to below $7 a share after the shutdown. On Friday, with theaters more certain to open, it was trading at about $15.
Adam Roberts, owner of Screenland Armour Theatre in North Kansas City, and Screenland Tapcade, 1701 McGee St., is worried about his two properties.
“It’s stressful, for sure, and scary, the whole thing,” said Roberts. Theaters have been bleeding money since the shutdown, he said. Rent and other standing costs, he said, amount to about $25,000 a month at the Armour Road theater alone.
They received payroll money through the federal Payment Protection Plan. But other major bills have not stopped. Bagby of B&B said his company has been working closely with 22 banks and various landlords.
“We’ve been very fortunate that almost all of them are working with us. If they hadn’t, I mean, we probably wouldn’t have made it through this,” he said.
Roberts expressed less certainty about his theaters’ future. Especially frustrating is that 2019 was their best financial year. They expanded Screenland Armour’s two theaters to four, took out a loan to do it.
“We haven’t made money since March 16,” he said. They held a May fundraiser and made $15,000, sold gift cards, held watch parties. Some money has come in through online streaming, but not much.
“We’re doing everything,” he said. “If there is a loan or grant or anything out there, we have applied for it.”
Roberts hasn’t set a precise date to reopen, but he expects they will. His website features the arrival of “Mulan” in late July. That will be more than four months without income.
“We have no intention of not opening right now. We are doing everything we can to prepare to reopen,” he said. “There are just so many questions. Every day, just new frustrations. We’ll see. We’re going to keep doing everything we can do.
“But I can’t predict the future. God forbid there is a second wave.”
This story was originally published May 29, 2020 at 5:38 PM.
