Pandemic threatens to reduce movie theaters to rubble

By R.T. Watson | Wall Street Journal

If your local movie theater succumbs to the coronavirus crisis, the coming attraction might be a bulldozer.

The theater industry was struggling before the pandemic with high fixed costs, mounting debt and stagnating attendance as in-home streaming options proliferated. But the lockdown has added to those pressures by halting incoming revenue for months and creating uncertainty over when, and if, customers will feel comfortable returning to cinemas.Number of indoor U.S. movie theatersSource: National Association of Theatre Owners.

The situation is seen leading to many theater closures, say analysts and industry veterans, creating the problem of what to do with the buildings once the curtain goes down for good. According to theater owners and real-estate experts, cinemas tend to be tough properties to move because the sloped floors and multiple rooms make them difficult to repurpose, especially in a commercial property market expected to get crowded with closed retailers, small businesses and offices.

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