It's showtime: Cinemas are back in business but it's rare for them to hit the market
Grab the popcorn and a Choc Top – it’s showtime.
Cinemas have enjoyed a revival in the wake of pandemic restrictions, becoming a major beneficiary of increased consumer spending throughout 2022. Now, movie buffs are enjoying watching their favourite flicks in freshly renovated cinemas after many operators made the best of a difficult situation during the worst of the pandemic.
Blockbuster films such as Top Gun: Maverick were a welcome shot in the arm, and with Avatar: The Way of Water just around the corner, a busy summer is in store.
According to Screen Australia, there are roughly 500 cinemas in Australia. Of those, over half are collectively owned by Hoyts, Event Cinemas and Village Cinemas, while about 30 per cent are independent.
When cinema operators choose to sell, the assets are usually traded within the industry.
“They seem to trade off-market between different operators,” said real estate agent Rodney King of Aston Commercial. “It’s very rare that a cinema will go to market.”
There are just two cinemas listed for public sale at the moment, and a former drive-in cinema that could be reinvented.
For the first time since being built in 1977, the cinema complex on Hewish Road, Croydon, is up for grabs.
In the decades after opening, the cinema expanded to include four screens and upgraded its digital projection and sound technology. It has operated under the Dendy, Village and Hoyts banners, but is now run independently.
During the pandemic, the owners opted to acquire the airspace above the cinema complex, with plans and permits in place to install another two screens,as well as an outdoor cinema with views of the Dandenong Ranges. Recently, the owners also bought an adjoining shopfront so the theatre entrance could be extended and renovated.
Aston Commercial is handling the expressions-of-interest campaign, marketing the complex as a “once-in-a-lifetime” opportunity to own and run a cinema.
While other cinema operators are already showing interest, King said the property could be scooped up by anyone.
“There are a lot of people who enquired because they grew up in the area and used to go to that cinema,” he said. “There are people that love movies and love theatre.”
A price guide was not available for the property, King said. “There’s no precedent set for what cinemas are worth. You’re not only buying the building but an established business. That’s why we’re putting it out to tender. ”
The expressions-of-interest campaign closes on October 28.
Much more than just a cinema is for sale in Charlestown, about 10 kilometres south-west of the Newcastle CBD. The Forum is a landmark commercial asset comprised of two separate buildings anchored by a successful Hoyts cinema complex as well as 11 other commercial tenancies.
The cinema complex recently underwent a $3.5 million redevelopment and has since capitalised on the post-COVID demand for entertainment.
Stonebridge Property Group, Commercial Collective and Burgess Rawson have been appointed to sell The Forum.
Burgess Rawson’s Rhys Parker said the fully leased asset had a net operating income of about $2.45 million a year.
“Rarely do assets of this calibre come onto the open market, particularly where there is a significant portion of the income stream anchored by a multinational tenant,” Parker said. “The Hoyts lease extends to 2041, representing approximately 36 per cent of gross income.”
Expressions of interest close on October 27.
This 3.5-hectare slice of land mightn’t look like much now, but it used to be an entertainment mecca of the Sunshine Coast.
In 1968, the Scottish Drive In Theatre opened, named after the nearby Scottish goldmine. Up to 300 cars would stream into the property to watch Hollywood hits like Jaws, Jurassic Park and Star Wars.
For the last two decades, the place has been under private ownership and home to a few horses. But, according to listing agent Alex Henriksen of NAI Harcourts Sunshine Coast, an astute buyer could return the property back to its glory days and revive the drive-in cinema.
However, a buyer would need to apply for a zoning change of use as the land is currently zoned as residential. “It is such a unique site, and one that should generate some equally unique interest,” Henriksen said.
