fbpx
Category

Blog

12.08 2020

Resiliency for Cinemas to Rebound and Thrive

By | No Comments

DECEMBER 8, 2020

Resiliency is not a new term for the Cinema Industry.  The industry has faced adversity in the past but economically has always been the Teflon industry.  Cinema has survived TV as noted by Greg Marcus:

“My grandfather, I know one of the ways he built the business after TV came along — so let’s talk about the fact that this industry does endure some significant shocks. And it endures. The keyword being endure. He went around to people who were getting theaters back and said, ‘Look, we’re going to partner. Because it’s going to come back at some level.’ And he was right. So I think there could be opportunities like that as we look forward.”

Greg Marcus

Marcus Theatres CEO Says Biz Endured “Significant Shocks” Before — Q3 Earnings – Deadline

After TV, cinema has survived the rise of VCRs, DVDs, and streaming.  At TK Architects, a nearly 40-year-old firm that has specialized in Cinema, Entertainment, and F&B since its inception, we believe cinema will survive the pandemic and can thrive again.  Building on our expertise, we challenge our architectural and engineering staff to develop dozens of concepts for cinema business post-pandemic.  We have also seen our vendor partners with longer histories than us pivot and provide creative solutions that are helping cinemas (and other industries) meet their immediate needs during the pandemic.  To move beyond surviving and back to thriving the question needs to be what is next for cinemas?

Converting to recliners and elevating food offerings implementation continues to be key improvements for re-inventing the industry.

Examining what is next for cinema is something TK thinks about every year since our creation but in a formalized way for the last 9 years.  Provoking a conversation tailored to a client’s individual needs while thinking about those needs differently is what we strive to accomplish with these concepts.  Sometimes the ideas push the envelope with a dreamer’s surrealism and other times they are perceived as achievable with some additional creativity. One of my favorite activities has been showing them to various clients and hearing their responses.  Clients can visualize them for their own brands.  Deciding the factors that go into the path to resiliency are unique to each location.

Covered speaker concept that was later executed by a client.
Urban outdoor cinema concept.

Right-sizing for new construction and re-demising for renovation are parallel paths that clients have taken and both remain relevant.  Reducing screen count is one approach.  This can provide negotiation options for discussion with the Landlord by giving back space.  Another approach we see as viable is repurposing the extra space for new entertainment uses.  Reuse ideas can include an expanded bar or a kitchen to convert the facility to dine-in.  Bowling, arcade, or trampoline are also repurposing options.

Re-demised cinema that reduced screens from 24 to 14.
Auditorium converted to a kitchen for dine-in auditoriums.

Concept for repurposing an auditorium as a bar adjacent to the Lobby.

Repurposing for event cinema, e-sports and gaming or other experiential cinema helps to diversify revenue streams making a location less dependent on Hollywood (or local content as the location may dictate). All of these alternatives can draw audiences to a facility at varied times beyond the prime Friday and Saturday night slots.  Finding the right mix for your facility requires research and testing.

Event Cinema concept and Bowling concept for repurposing two adjacent auditoriums.

Capitalizing on the information and data that an exhibitor has access to from their loyalty programs can factor into additional amenity research.  As cinemas diversify their offerings, avoiding the struggle cinemas experienced when first managing kitchens for dine-in by adding people knowledgeable in these different areas will help the ventures succeed.  The road to rebounding and thriving will be paved with combinations of the elements mentioned here.  We look forward to helping to steer clients to the road that works for them.

Theresa English

11.11 2020

Freedom is Never Free

By | No Comments

November 11, 2020

I am Steve Petracek, a Principal at TK Architects and a CDR in the US Navy Reserves and I want to say thank you and express my thoughts on this Veteran’s Day.  I am in the Navy Reserves and only a few months short of achieving the 20-year mark, but I have no retirement plans.  The military has helped me grow in ways I couldn’t see 20 years ago.  There have been some good times and some bad times, but all of them have helped shape me into the person I am today.

I joined the Navy in May of 2001, only months before the 9-11 attacks.  My wife and I had discussed the time and effort it would take, but we had no idea what lay before us.  I have only completed two deployments during my time.   My first tour was to Kuwait in 2006-2007 for eight months, with my second one to Afghanistan in 2012-2013 for 12 months, with each providing unique experiences.

In Kuwait, I was a lieutenant tasked to provide engineering management for small construction projects in the state’s eastern part.  My home was Camp Arifjan, and my focus was on overseeing projects that provided safety and resource staging for our troops.  I had the continual support of the Kuwait military in all I did.  I can’t imagine letting any other sovereign nation establish a base on US territory, yet they did and were very thankful.

My trip to Afghanistan was an entirely different story.  I was the operations officer for the battalion, and I started this position a year before our unit was to deploy.  What the means is I was responsible for training and preparing 550 people through classes and field exercises to face the austere and hostile environment Afghanistan was at that time.

For any of you who have seen “Band of Brothers,” a bond does form with people who endure hardships together.  Shortly after leaving Afghanistan, I read a quote that best describes the deployment.  It has stayed with me, and the further I get from my time there, the more real it rings, “I am homesick for a place I never wanted to call home.”  The bonds created there are forever locked in me that time will never take away.

I have been blessed in many ways.  I have a wonderful family that has supported me and been there every step of my journey, as well as an understanding and appreciative company that has bent over backward to help any way they can.  As my family will attest, these 19+ years have not always been easy.  The time away is difficult, and each of us changed in ways we didn’t think.  We have ridden the rollercoaster through numerous hills.  The best and worst times followed each other closely.  The joy of coming home from a year’s deployment was followed immediately by anger and resentment.  We never went back to the way we were, but we always found a path through the hardships.

There is so much more I could say, and if you ever want to listen to it, I would love to grab a cup of coffee and talk about it.  Good or bad, I am thankful for the opportunities to serve my country.  I am so very grateful for what my country has provided me, and it has been my pleasure to give back in some measure.

Non sibi sed patriae.

Steven Petracek

10.29 2020

Reimagining The Restaurant: Week 6

By | No Comments

COVID EDITION

OCTOBER 2020

Idea #7

Food trucks were a hit before Covid.  Not only are they convenient, deployable, and festive but they’ve been elevated from a culinary view point in the past decade.

This concept builds a restaurant around the food truck phenomenon that is all about flexibility.   From a construction point of view, this building is columns, beams, roof and a lot of garage doors.  Spatially, this is a dining space with a block of restrooms, no kitchen, no coolers, no hoods.  The kitchen is in the vehicles and can be supplemented as needed.  On nice days this can be an open air restaurant, almost like a biergarten or farmers market.  As the weather turns, the doors come down and the restaurant transforms into a light filled, cozy conditioned space.

This concept solves the awkward patron-vendor height difference by elevating the dining platform for customers.  Along either side of the truck lane is a rail with a bar-top for fall protection and dining space.   Although there are a number of ways this concept could be implemented aesthetically, this one played around with a garage theme and even teases the idea of a bar-mobile with horseshoe bar seating.  Durable polished concrete floors, exposed structure, supersized graphics, and ample natural light provide style on a budget.  The color comes through vibrant furniture and the trucks themselves.

You could also imagine other functions or revenues that could happen in a structure like this: games, retail pop-ups, local collaborations, events.  Ultimately this concept takes the food truck festival, a popular trend that happens on street curbs and gravel lots, and elevates it, creating a flexible year-round space for dinging, commerce, and gathering.

Well, that wraps up our 6 week exploration of the Food and Beverage facility of the future.  We hope you enjoyed this playful series and maybe came away with some ideas.

Do you have one you’d like to see tested out and illustrated?  We’d love to hear about it!

10.08 2020

Inflection Point for Cinema Exhibition

By | No Comments

October 2020

The Cinema Business and specifically exhibition have been a challenging business model since their beginning.  It enjoyed a golden age, and while forever changed by the advent of television, it has remained a significant, stable, and profitable business.  It faced an onslaught of challenges that had many predicting its demise including VCR, Cable, DVD/Blu-Ray, and streaming.  The key reason that exhibition survived these challenges is focused and consistent re-invention and innovation.

All businesses rely upon partners to provide them products and/or services.  Exhibition takes that to another level by relying upon movie content to draw customers to their facilities.  In other words, studios have provided the content and exhibition provided the venue and the experience.  The business has always been cyclical based on popularity of content, but with long-term stable revenue growth as illustrated below:

Cinemas, along with most places of public gathering, have been shuttered since March by Covid-19.   Cinemas have been permitted to open with limited capacity in many locations, but the results have been less than optimal because there is hesitation from customers and little fresh content to draw them back. 

The changes that have happened in 2020 to the exhibition business model are troubling to long-term viability.  The three most impactful changes, from my viewpoint, are: 

  • Reversal of the US – Paramount Consent Decree
  • Studios changing theatrical release patterns – is this a short-term response to pandemic or a longer-term change?
  • Increased variety and availability of content, and broader acceptance of it from a variety of sources

These changes lead many to predict (again) the end of the movie theatre and moviegoing.  That is one possible outcome, though doubtful.  Another is that the resilient and creative exhibition community will once again rise to the challenge.  I believe they will and would like to talk about what that might be. 

First, it is important to consider what we have learned and will continue to learn from this pandemic in the weeks, and months ahead, including:

  • Safer, touchless ways to transact business, including new customers now more comfortable using digital platforms
  • We can survive in isolation with digital interaction and support, but
  • We crave real social interaction

This combination of exhibition business model changes and pandemic lessons learned create an inflection point, or time of significant change, for cinema exhibition. 

The question is growth or decline?  Let us dig a little deeper into the impactful changes.

The reversal of the Paramount Consent Decree, even with the two-year sunset period on block booking and circuit dealing, could be disastrous for independent and smaller market cinemas. Therefore, many in Hollywood pushed back on the removal of the decrees, including the National Association of Theater Owners, the Directors Guild and the Writers Guild of America, arguing that removing such restrictions could hurt independent films, among other things.

Among the rationales for the reversal was that the decree does not apply to all studios, to streamers or international competitors https://deadline.com/2020/08/paramount-consent-decrees-justice-department-2-1203007221/ 

Some speculated that large tech companies could be in the market to purchase exhibition companies as an outlet for their own content.  However, Reed Hastings co-CEO of Netflix told The Hollywood Reporter during a September 10th interview “I can’t see us doing a chain or expanding in theatrical,” https://www.hollywoodreporter.com/news/reed-hastings-says-netflix-wont-buy-a-theater-chain-but-thinks-moviegoing-will-return .   There are dozens more content providers that could have different views or objectives. I expect there to be further consolidation resulting from this ruling and the pandemic shutdown.  Someone will see this as an opportunity, whether currently in cinema exhibition or not. 

The change in studio theatrical release, is to me the biggest and most impactful change in the exhibition business model.  The theatrical release business model has been the glue of studio-exhibition partnership.  Even a short-term adjustment, during the pandemic, is controversial.  How this issue resolves long-term is the biggest driver of the direction of the inflection point. 

I also believe that the increased variety and availability of content can be considered a significant part of a new business model.   Content creators are engaged in different vehicles beyond the major Hollywood studios.   Outstanding content is being created in the international/global marketplace.  There is an opportunity for content that does not fit into the two-hour, formulaic standard. 

These combine to create a real threat to the cinema exhibition business model.  Unless you redefine the business model.  What do I mean?

Be a communal place for social interaction.  Diversify the offerings.  Focus on developing other sources of content including events, independent and (dare I say it) streaming. 

Cinema Entertainment Centers, featured in Box Office Pro in August https://www.boxofficepro.com/the-next-big-thing-the-risks-and-rewards-of-cinema-entertainment-centers-one-of-the-fastest-growing-trends-in-exhibition-today/ is one proven model.  Several exhibitors have redefined their business model to include other entertainment components, and some entertainment center businesses have added cinema to their business model. 

Challenge everything about your business.  Strive to be the place for people to socialize, eat, drink, play and have fun.  Cinema is a shared social experience and should remain a focus.  The studio/tentpole movie model works, will remain, and requires and deserves large premium auditoriums.  Other forms of content might be better served with non-traditional spaces.  Consider boutique/social bowling.  Games and gaming are a growing business.  Consider eSports, virtual/alternative reality components, including other active participation activities such as zipline, climbing and use of outdoor spaces.  Concentrate on food and beverage, the mixture and quality of offerings to optimize revenue and profitability. 

Find the right, new combination – the next big thing.  Be the place for people to socialize, eat, drink, play and have fun in the communities you serve, and it will lead to a better, more robust business model, and long-term stable revenue growth.

Founded in 1981, TK Architects is a full-service architectural firm that offers all professional design services in-house to simplify and streamline coordination, including: Architecture, Interior Design, Graphic Design, Structural Engineering, Mechanical, Electrical, and Plumbing Engineering. The firm’s focus is entertainment architecture and engineering, including cinema, bowling, bars/lounges, food service, and entertainment centers worldwide. TK Architects provides the right services at the right time to meet client’s specific needs, including: New Buildings, Tenant Interiors, Renovations, Facility Upgrades, and Maintenance.

For more information about TK Architects please visit www.tkarch.com or contact Jack C. Muffoletto, at jcmuffoletto@tkarch.com

Mike Cummings