Movies and Shakies
The Loew-down on Location, Location, Location
| The old retail adage,
"location, location, location," is not just about doing business after
you’re established; it’s also the key factor in determining the difficulty and
expense of developing commercial real estate in the first place. And there’s no
better example of how big a difference can be made by a small distance than in Boston,
Massachusetts. In a downtown location, at Boylston and Tremont across from Boston Common, Millennium Partners (212-595-1600) is happily into construction of its $400-million Millennium Place, a 1.4 million-square-foot, 400-foot-tall project featuring a 100,000-square-foot Reebok Sports Club, a 20-screen, 5,000-seat, 100,000-square-foot Loews theater, a luxury hotel, condos and 85,000 square feet of retail. |
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Just a mile or so down Boylston Street in the neighborhoods of Fenway and Back Bay, Millennium Partners is trying to build a very similar project: a $500 million, 650-foot-tall behemoth featuring ingredients similar to its downtown project. This one, called Boylston Square, would sit atop the Massachusetts Turnpike and would become the third tallest building in the city.
Different Neighborhood, Different World
Despite the enthusiastic backing of the Massachusetts Turnpike Authority (MTA), which stands to make millions on the deal, the Boylston Square project is mired in community opposition and tangled in environmental red tape. Boston newspapers have printed multiple stories of the battle the Fenway and Back Bay residents are waging against the project.
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Mark J. Pascucci, vice president for advertising and publicity at Loews Cineplex Entertainment (212-833-6148), was only too glad to rattle off the features of the Millennium Place project, "...condos, a hotel, a Reebok Sports Club, a 22-screen Loews Cineplex..." But when asked about Boylston Square, Pascucci’s only comment was that it would be 14 screens and, "We’re committed to it." He directed further questions to Millennium Partners. It will be at least a year before permits can be issued for Boylston Square, says Joe Larkin of Millennium Partners, because the developer has just issued a "draft project notification form," which Larkin says is a step "before the first step of the environmental review process," intended as "an introduction to the public of what the project could be." |
As for the neighbors, Larkin says diplomatically, "The dialogue is getting more productive. People have had time to consider and think what’s important to them." Environmental review in a city location on top of a turnpike does not deal much with birds and flowers and rare fish. Rather, it is a process that examines everything that the project could have an impact on, such as urban design, traffic, parking, air quality, shadows, daylight, wind, and so on.
Smaller May Not Work
A revised plan designed to reduce the size of the development site a horizontal reduction that was accompanied by an increase in height to 650 feet was met by opposition no less vocal than before, and the crux of the problem may lie in the economics of the site. Millennium officials have said the high cost of building over the turnpike sets limits on how much the project could be scaled back and still be economically viable.
One of the biggest complaints centers on the huge shadows that would be created by the project, but another is parking. The parking plan for the 14-screen, 4,600-seat Loews theater calls for 850 spaces. Industry experts tell E.S.P. that a seats-to-parking ratio of three-to-one is standard for theaters, a formula which, if followed, would dictate 1,533 parking spaces. One opposition group predicted the neighborhood would be "just overrun by automobiles" and claimed mass transit does not serve the area well enough to allow such a parking shortage to work.
By contrast, the 5,000 seat, 100,000 square foot theatre at Millennium Place is being tagged as Loews Cineplex Entertainment's flagship theatre in Massachusetts. The hotel has yet to be named, but Larkin said it would be "five stars, at least." The Reebok Sports Club, at 100,000 square feet, is a bit smaller than its 140,000-square-foot namesake in New York City’s Lincoln Square, but it is nevertheless a gargantuan athletic facility that includes full-size basketball courts, a 90-foot-tall indoor climbing mountain, and acres, literally, of all sorts of fitness and training facilities. The Reebok Sports Club concept, says Larkin, is destined "to become the next century’s version of the best in that field."
Loews Cineplex Entertainment is involved with several other Millennium projects, including Lincoln Square in Manhattan, which houses Sony Theatres Lincoln Square; the 20-screen Star Southfield Entertainment Centre in Southfield, Michigan, one of the country's highest grossing theatres; and Metreon in San Francisco, where a 16 screen Sony Theatre is scheduled to open in Spring 1999.
Millennium Place in Boston is scheduled for completion in Spring 2000. The Loews Theatre at Millennium Place will feature stadium-style seating in every auditorium, with stepped seating rows providing unblocked sightlines to the screens, increased leg room and screens nearly double the size of typical theatre screens. In addition, all 20 auditoriums will feature plush, oversized high-back seats.
Every auditorium will be equipped with state-of-the-art projection and Sony Dynamic Digital Sound (SDDS). In addition to the traditional snack fare, the theatre's concession stands will offer gourmet coffee, baked goods and a wide selection of hot foods, including chicken wings, popcorn shrimp, curly fries and chicken tenders. All these new menu items will be prepared to order, says Loews.
The Loews History
Loews Cineplex Entertainment is one of the world's largest motion picture exhibition companies, with 2,700 screens in 425 locations primarily in major cities throughout the U.S. and six provinces in Canada. Loews Cineplex Entertainment's divisions include Loews Cineplex United States, Cineplex Odeon Canada and Loews Cineplex International. Loews Cineplex Entertainment operates theatres under the Loews, Sony and Cineplex Odeon names. Additionally, Loews Cineplex Entertainment is a co-venture partner in Magic Johnson Theatres and Loews-Star Theatres.
In Massachusetts, Loews Cineplex Entertainment currently operates 12 theatres with 82 screens, under the Loews and Sony Theatres names. A new location, the 20 screen Loews Liberty Tree Mall Theatre in Danvers, opened in December 1998.
One Merger, Two Lawsuits
Loews Cineplex Entertainment was formed in 1998 with the merger of two theatre circuits, Loews Theatres and the Cineplex Odeon Corporation. The merger was promptly investigated last January by five state attorneys general and then challenged by the New York and Illinois attorneys general as anti-competitive under federal antitrust laws. Settlement was reached by April, netting a consent decree in which Loews must sell off 24 New York and Chicago movie houses.
Cablevision Systems Corp. agreed in December to buy 31 Loews Cineplex Entertainment Corp. movie theaters with 105 screens for $92 million more than the judgment required in New York City, suburban New York and Chicago. Cablevision is moving aggressively into the movie-theater business. Also in December, it bought Clearview Cinema Group Inc. for $160 million, its first entry into that business. Cablevision wants to capitalize on cross-promotional opportunities between its various media properties, including cable systems and its operation of Madison Square Garden and Radio City Entertainment.
Loews Theatres, the oldest theatre circuit in North America, was founded in 1904 by Marcus Loew, whose first "nickelodeon" in a rented store evolved into the Loews Theatres circuit. By the start of World War I, Loew had locations throughout the U.S. In order to supply his theatres with new film product, Loew purchased a failing silent movie production studio named Metro Company. In 1924, Loew joined forces with the legendary Louis B. Mayer, a former Chelsea, Massachusetts scrap metal dealer, and Samuel Goldwyn to form the Metro-Goldwyn-Mayer studio.
Loews Theatres continued to grow from coast to coast throughout the 1930s and 40s and, in 1954, the Department of Justice ruled that theatre circuits such as Loews, Paramount and Warner Brothers, which engaged in film production and distribution as well as the operation of theatres, must divest their studio facilities from their theatre chains. Thus, Loews Theatres and MGM became separate entities, and the theatre circuit continued on its own.
A Circuitous Route
In the years that followed, Loews Theatres expanded and was the genesis of what became the Loews Corporation. In 1985, the Loews Corporation sold its 350 screen circuit to a privately held company. Soon after, the theatre chain was purchased by Tri-Star Pictures which in turn merged with the Entertainment Business Sector of Coca Cola, forming Columbia Pictures Entertainment. It was during this time that Loews Theatres experienced its greatest growth, acquiring four regional theatre circuits and building many new multiplexes, more than doubling in size to almost 1,000 screens. In 1989, Coca Cola sold Columbia Pictures Entertainment to the Sony Corporation of America.
Cineplex Odeon Corporation was founded in 1979 with the opening of its first theatre complex, a 21 screen megaplex at Toronto’s Eaton Centre. Throughout the 1980's, the company expanded through new construction and through acquisitions of regional theatre circuits in Los Angeles, Chicago, New York, Washington DC and Seattle.
In 1986, Cineplex secured a significant investment in the corporation from Universal Studios Inc. and subsequently built its first flagship theatre in the U.S., an 18 screen complex at Universal’s
"City Walk" in Los Angeles. The theatre has become one of the highest grossing theatres in North America. Cineplex Odeon Corporation merged with Loews Theatres in May 1998, creating Loews Cineplex Entertainment, one of the world’s largest motion picture theatrical exhibition companies. Loews Cineplex Entertainment’s divisions include Loews Cineplex United States, Cineplex Odeon Canada and Loews Cineplex International.
Today, Loews Cineplex Entertainment operates 2,870 screens in 450 locations primarily in major cities throughout the United States, Canada and Europe under the Loews, Cineplex Odeon and Sony names. In addition, Loews Cineplex Entertainment is a co-venture partner in Magic Johnson Theatres and Star Theatres. Internationally, the theatre circuit has locations in Hungary and Turkey and is a partner in Yelmo Cineplex of Spain.