Rants and Raves: Cinepolis Luxury Cinemas
Mexican Exhibitor Opens Its First U.S. Luxury Theater
Tuesday, August 2, 2011
Last month, Cinepolis Luxury Cinemas opened its doors in Del Mar Highlands. Can a luxury theater with $22 ticket prices survive in our current economy? Listen to my radio feature or read the extended article.
If you want to watch a movie these days you have a lot of choices. You can go to a multiplex, pick up a Bluray to watch at home, stream a movie to your TV, or download films to your iPhone. You can watch in 2-D, 3-D,4DX or D-Box. But with all the new fangled technology, Cinepolis Luxury Cinemas are returning to something old.
CARLOS WELLMAN: We're trying to recreate that luxurious experience that our grandparents grew up with where going out to the theater was a whole event.
Carlos Wellman is the managing director of Cinepolis Luxury Cinemas. The Mexico-based company runs the largest movie chain in Latin America. It also has theaters in India. Last month it opened its first theater in the U.S, giving the international exhibitor some 2800 screens (including 34 V.I.P. cinemas in Mexico) in 11 countries. Most recently, Cinepolis took over the old UltraStar Del Mar and renovated the multiplex with a mix of old movie palace grandeur and new state of the art digital projection. It's all part of a business plan that involves careful evaluation of demographics.
CARLOS WELLMAN: We saw an opportunity in the U.S. market as real estate was low and the economy was low, and a lot of different things made us feel this was the right time to venture into U.S. market. California being where trends start and we believe that if we attack the Southern California region first that will help us grow. So the first thing is we've tried not to add new screens to the market. We've taken over some older theaters that were run down and needed to be fixed up, and not only that but we're looking at locations and at competition and at the people that live around the area, the affluence of the people that live around the area,the average household incomes are to support our business model to say people might want to choose us to go to the theater versus others.
That's because Cinepolis boasts 38-foot screens, a full bar and restaurant, at least 7 feet of aisle space, and 2 of the 8 auditoriums allow liquor sales inside. There's also stadium style seating with each successive row a full 2 feet higher than the previous one so when people or waiters move about the theater it's less of a distraction to anyone watching the film. If it feels like a glorified living room that's because Wellman's first love is architecture and he spends much of his time designing luxury homes. That might also be why every seat is a leather recliner, which impressed first time patron Kathy Hansen.
KATHY HANSEN: The seats are phenomenal really comfortable they are cushy and my daughter just pushed a button and I almost laid down. I thought I was going to sleep rather than watch a movie and you have a place to push a button and server comes and serves you. I mean what else could you ask for?
Such amenities attracted Gina Tribolett's kids who wanted to see the new "Smurfs" movie.
GINA TRIBOLETT: They are really excited about getting on the chairs and moving them around and ordering food and it's so nice and clean and for a treat this is a nice place to come but the price is quite a bit more expensive than what we are accustomed to paying so it probably won't be our regular movie theater.
But Wellman points out the the price difference between Cinepolis tickets and those at a multiplex is about $7 and local residents might spend that on gas to drive to another more traditional theater. Phillip Lorenzo chose to come from Lemon Grove to the theater on its opening weekend.
PHILLIP LORENZO: Sitting in the theater when I went to see "Captain America" I have never sat in a more comfortable seat in my life. And I think that's the most important thing about it. It's nice that there's restaurants, it's nice that there's a lounge, But the most important thing is your experience watching the film. I think they have taken the theater experience seriously as much as they have taken the other amenities and the other part of the experience seriously.
That's important to Lorenzo who is the managing director of the San Diego Asian Film Festival. He thinks the theater could provide a perfect venue for fundraisers or intimate screenings with filmmakers.
PHILLIP LORENZO: I think the big thing that's attractive to me is this exclusivity, it's almost like you're driving a BMW or Mercedes instead of a Yugo or something.
But there are downsides: cost of the venue, small seating capacity, and the location in North County is not as central as a film festival might want.
PHILLIP LORENZO: But for me as someone who's been involved in film festivals I can see a lot of value in it because of the amenities it offers -- alcohol, full food, nice seats, great screen, and professional staff.
And people appreciate those amenities says Cinepolis' Carlos Wellman.
CARLOS WELLMAN: We opened the doors and before we were even said we were open we were full. So we have about 72 people on our staff right now and we're hiring more because we noticed the rush times we need to have more waiters, we need to have more runners, we need to have more bartenders, we need to have more managers.
Wellman admits that the overhead for his theater is higher than for the typical multiplex because he has a full bar and restaurant as well. But he's factored that into the equation.
CARLOS WELLMAN: In reality our business model works at a pretty low percentage rent. Most theaters are running at 8 to 18 percent. We hope to exceed 50 percent but we will be okay if it's lower than that now obviously given that it's a couple of weeks we've been running at over 75 percent so that's telling you that we think we might be have a good product.
Having a 40-year-old multi-million dollar corporation behind you provides a nice cushion, which may be why Cinepolis is already pushing ahead with construction of a theater in La Costa and just signed a lease for another in Laguna Nigel. Wellman says that in less than 6 months he hopes to have 7 locations in California offering consumers a high end movie going experience.