Today is the last day for the Celebration AMC 2. The space is showing as available for lease. (hat-tip to the Celebration History Center for the link)
There’s been a lot of lively discussion on the internal Celebration residents message board, with a lot of “how could they do this to us?” sentiment. I’m not happy the theater is leaving, but I won’t pretend that I’m surprised, either.
AMC, the movie theater company, is a business. Lexin Capital, who own the downtown buildings, is a business. These businesses will do what they feel is best for their shareholders, within the confines of whatever business partnerships and/or contracts they’ve signed. AMC is ultimately accountable to their shareholders. First and foremost, their shareholders want to earn a return on their investment. This is done by having revenues that exceed expenses across the enterprise. If a theater is proving to be a drag on the earnings, and there’s no other reason to keep it around (like prestige or good will), then they should be looking to close it. While this isn’t Government 101, it’s certainly Business 101. It may even be a better long-term decision for a company to break a contract and incur short-term pain (or judgments) if it nets a benefit in the long-term.
Does AMC have a responsibility to the community? No! With an interest in 5,000+ screens, why should they devote any time to trying to make two of them profitable? Put another way, consider this: say they’ve earmarked $500,000 for amenities upgrades in the Orlando market. Where should they invest that? Where are they likely to see a return on that investment, of course. Celebration? Where they can barely get enough people into the theater to fill a single row? Not likely.
What’s Lexin’s role in this? Same as AMC’s: to provide the highest possible return to their shareholders. There may be internal disagreements about how to accomplish this goal, but not about the goal itself. Plus, it gets a little murkier with Lexin, as some of its moves are strategic and may not have immediately obvious benefits, but the benefits are there. It’s more trickle-down with them. They sponsor an Oktoberfest concert that brings people into the downtown who provide revenue to merchants that enables those merchants to keep paying rent. Or fireworks. Or snowfalls and carolers.
In the end, who wants a shiny theater in their downtown that nobody ever goes to? How does that serve the community?
So now what? I truly believe an alternative, Enzian-style theater could be sustainable here. Previously the theater had to compete not just with the outstanding sister theater over at AMC Pleasure Island 24, but also with all the other entertainment options available in one of the busiest tourist areas in the world. But I do believe there’s a niche that could be filled.
Thoughts?
