The soon-to-be-redeveloped Lansdowne Park now has another question mark as a future tenant that was slated to open a theatre at the site’s vast new retail space announced Thursday it’s moving away from the movie business.
View from corner of Bank Street and Aberdeen Way looking southeast.
Empire Company Ltd. said it plans to sell its location in Kanata, as well as other locations in Ontario and Atlantic Canada, to Cineplex Inc.
The deal does not include the Empire location at the World Exchange Plaza or the planned location at Lansdowne Park, said Pat Marshall, vice-president of Cineplex, in an interview.
The firm doesn’t have any plans to open a cinema at either location, she added.
A spokesperson for Empire could not immediately be reached for comment.
The Ottawa Sports and Entertainment Group, which is handling the Lansdowne project, is still unsure of what Empire’s decision means to the future of the project.
“We are only aware of what's been reported in the media and are trying to understand the implications for the Empire Theatre planned at Lansdowne,” said Roger Greenberg, a partner on the project, in a statement. “When we do find out, we'll be happy to share further.”
The theatre is already under construction, the statement said. It did not say whether there was a lease agreement in place.
Empire’s departure would leave another hole to fill at the Lansdowne site. The company responsible for the project’s retail components, Trinity Developments, has issued few details about its plans for a large part of the close to 400,000 square feet of retail space.
It listed several new tenants – including TD Canada Trust, Rexall and Jack Astor’s – in February but then pulled them down a short time later.
Empire was still listed as a future tenant at Lansdowne on Trinity’s website as of Thursday afternoon. Messages left with the company were not immediately returned.
The location at Lansdowne, which was scheduled to open in 2014, was supposed to replace a theatre at the Rideau Centre that closed this spring.
The Kanata location of Empire Theatres is one of 26 movie theatres across the country Cineplex Inc. plans to acquire., according to Thursday’s announcement.
It’s part of Empire’s gradual move away from the theatre business. Cineplex plans to buy the theatres for a total cash purchase price of $200 million, subject to closing adjustments. With most of the screens located in Atlantic Canada, the purchase will expand on Cineplex’s current 136 theatres between British Columbia and Quebec.
“This acquisition is an excellent strategic fit for Cineplex. It provides us with a presence in Atlantic Canada and it will enable us to leverage our existing businesses to maximize shareholder value,” stated Ellis Jacob, Cineplex president and CEO.
Empire stated it will undertake a $55 million transaction by Landmark Cinemas, which is acquiring an interest in 20 Empire theatres.
“Upon closing, the assets will be held by a new entity with Empire Theatres' equity being the controlling interest,” Empire stated.
“The new entity will be consolidated into the company's financial statements, including $30 million of debt in the new entity.”
Landmark will oversee the business, and will have until Dec. 31, 2013 to purchase Empire’s equity stake for $19 million in cash.
Should Landmark pass on the option, Empire can sell its equity interest to another party “and require Landmark to sell on the same terms,” Empire added.
In a statement, Empire’s CEO and president said it had been a hard decision to make the transactions.
"The decision, however, aligns with the strategic direction of the company to focus our resources on our food retail business through our 100 per cent interest in Sobeys Inc. and on our related real estate investment through our 42.8 percent ownership interest in Crombie REIT,” stated Paul Sobey.
The agreements are expected to be finalized in late summer, but they are subject to closing conditions. Also, approval must come from regulatory authorities.
But while Empire’s decision threw doubt on the future of a couple theatres in the city, news about another one in Orleans arrived shortly afterwards.
Movie chain CinéStarz plans to have six screens open at the Orleans Town Centre on Centrum Boulevard before the end of the summer, Bob Monette, the city councillor for the area, announced Thursday.
The new theatre will replace the satellite version of the Mayfair, which closed down in February.