Paul Glantz admitted that his attempt to acquire four idled movie theaters from a bankrupt rival is a bold kind of proposition for his Emagine Entertainment movie-theater chain. “People will either say I’m a genius or a bumbling lunatic,” said the chairman of the Troy, Michigan-based outfit with 21 company-operated or licensed theaters in Michigan, Wisconsin, Minnesota and Illinois.
But Glantz is doing it anyway. Even as he continues to chafe under theater-lockdown orders that are continually extended by government health departments, Glantz has just signed long-term leases for four of the 30 theaters previously operated by Goodrich Quality Theaters, a Grand Rapids, Michigan-based outfit which filed for bankruptcy protection in February just before the pandemic shut down its outlets in the Midwest.
Even as screens remain dark throughout Emagine’s footprint and he believes officials such as Michigan Governor Gretchen Whitmer are unfairly – and unscientifically – throttling his specific industry, Glantz was on a Detroit-radio telethon Thursday pitching holiday packages of Emagine gift cards and popcorn, and pledging $20,000 in support of the charity.
Even as he watches day after day of what is traditionally the biggest season for his industry go by with zero revenues coming into the corporate till, Glantz is negotiating with local officials in southeastern Michigan to build Emagine’s biggest property yet somewhere in central Detroit.
And even on a day when Walt Disney Co. underscored a dedication to debuting its industry-leading movie content on streaming services and to de-emphasizing premiers in theaters, Glantz was talking about how his company is continuing to work on reinventing the movie-going experience so theater patrons will flock back to Emagine in the coming months.
“Realistically, I understand the headwinds and how pundits talk about our industry being over, but I’m a believer in people wanting experiences outside their home,” Glantz told Chief Executive on Thursday. “Some don’t. But the world is big enough that I don’t have to conquer every element of the population to have a successful business. We need to grow our market share of movie-goers by giving them a great experience.”
So Glantz isn’t sitting still. He’s busy getting Emagine ready for reopening again, bolstered by the fact that the former financial-company CEO had put Emagine’s balance sheet in very good shape long before the pandemic sapped resources.
For one thing, Glantz is making a big play for expansion within Emagine’s basic Midwestern footprint by leasing two theaters from Goodrich in Indiana, one in Michigan and one in Illinois. Emagine will pay more than $10 million to convert the properties while landlords pick up another $8 million to $9 million in costs. Previously, Glantz was trying to buy all of the chain’s assets, “but these four theaters we’re leasing provided about 25 percent of Goodrich’s revenues” among Goodrich’s 30 theaters.
Goodrich “had been spread too thin and wasn’t focused on the guest experience the way we are,” Glantz said. “This isn’t a done deal – we still have to get some financing. But people will see this as an investment opportunity in an out-of-favor industry, essentially a value play. There’s a lot of upside relative to the downside.”
It’s not a bet-the-farm gambit because of Glantz technically is keeping the transaction separate from Emagine per se and has negotiated a liability firewall if the deal doesn’t all come together within a few months.
At the same time, Glantz is redoubling his efforts to make Emagine theaters a place where consumers can get something they can’t get sitting on their couches in front of big-screen smart TVs. His company was a pioneer in installing amenities such as lounge-style seating and cocktail bars in the lobby, and now Glantz has to go back at the “customer experience” formula again.
“So now we’re replacing a lot of our reclining chairs with heated reclining chairs,” perfect for Emagine’s Midwestern markets during prime fall and winter movie-going months, he said. Emagine also is improving geo-coding in its buildings so a patron can order two cocktails in the lobby bar before the movie, imbibe one there while he or she is waiting – and then have an Emagine server slink over to that customer’s theater seat during the show and deposit the second drink.
“Our servers are very discrete,” Glantz said. “And during the show they’re only going to be bringing extra liquids – not full meals.”
All the while, Glantz is betting – big, as he repeated – on the notion that vaccine-emboldened Americans soon will begin trickling, then streaming out of their homes and back into movie theaters.
“I don’t think we’ll come back with a boom,” he allowed. “But there is pent-up demand. Folks are weary of staying at home. They want to participate in congregate activities. And the vaccine should help address the fear-mongering that’s going on by government officials and the media. If folks are vaccinated, then we’re going to find baseball stadiums filling up again, too, and we’ll begin an incremental return to life as we knew it.
“Studios aren’t being our best friends, by taking some of their best stuff to video. But I think there’s still something special about the movie-going experience.”