Limelight Cinemas general manager Alexis Poulsen.
Limelight Cinemas general manager Alexis Poulsen.

Refurbished CBD cinemas will be ‘catastrophic’ for Limelight

THE CEO of Limelight Cinemas believes plans by Ipswich council to pump millions of dollars into refurbishing the cinema complex in the CBD will cripple his own business.

Ross Entwistle said a study commissioned by Limelight shows neither cinema sites, which are two kilometres apart, would be sustainable if the one in the city centre is up and running again.

His comments come as the council finalises the details on a lease agreement with an operator for the site formerly filled by Birch, Carroll and Coyle.

An upgraded cinema complex and indoor go kart track are on the cards as part of the council's revamp of the CBD.
An upgraded cinema complex and indoor go kart track are on the cards as part of the council's revamp of the CBD.

The CBD movie theatres closed in May last year after more than 50 years, with BCC choosing not to renew its lease due to a significant decline in patronage.

Limelight Cinemas opened in Riverlink Shopping Centre seven years ago and employs 55 people across the cinemas and the adjoining Ruby Chews Burgers and Shakes.

Mr Entwistle said he commissioned a study to assess potential attendance at the planned CBD cinemas.

“We did that for a number of reasons,” he said.

“One to test the viability to determine whether it was something we wanted to pursue but equally just to look at what the likely impact on our existing business would be if they were to proceed.

“The outcomes were pretty sobering on all fronts

“It would simply be a situation of splitting an existing pie.

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“The outcomes for the attendance rates in the proposed CBD cinemas would only be very marginally ahead of the numbers being achieved by the former BCC cinemas which were closed because the rate of business was simply unsustainable.

“To our own business it saw a 30 per cent decline in attendance which would be catastrophic for us.

“In essence, it was doing nothing other than robbing Peter to pay Paul and risk the prospect of creating two failed businesses instead of one sustainable one.”

The council says the cinemas are an essential component of the new Nicholas Street Precinct and the refurbished complex is seen as key to strengthening the city centre.

About $33.6 million has been allocated to the ‘venue, eats and metro B’ phases of the precinct, which includes the proposed cinemas.

The cinema industry has been hammered by COVID-19.

Even as they welcomed back customers in recent months, only limited numbers are allowed in and studios have held back from releasing blockbuster titles.

Mr Entwistle pointed to the recent closure of cinemas in CBDs in Mackay, Darwin, Cairns and Adelaide as a clear sign of the change in customer behaviour.

Limelight also operates a cinema in Tuggeranong in the ACT.

Limelight Cinemas CEO and founder Ross Entwistle.
Limelight Cinemas CEO and founder Ross Entwistle.

“Trading (at Limelight Cinemas Ipswich) is down more than 70 per cent where we would normally be at this time of year,” he said.

“Adelaide was an interesting comparison because it was a CBD site that had previously closed and reopened after a very significant refurbishment not dissimilar to that proposed by council for Ipswich.

“It lasted two years and closed again permanently.

“The argument is they existed before so we think they’ll be right again despite all the evidence and our commissioned research that said the opposite.

“They’re pointing to a failed cinema as a reason for doing another one.

“After losing $78 million on failed developments in the CBD, one would have thought doing some real research into the likelihood of the success of that expenditure was required at an absolute minimum.

“We have asked now for months and months and months for any research that may have been done to suggest that the cinemas were viable. None has been forthcoming so we undertook it ourselves.”

Ipswich deputy mayor and Ipswich Central Redevelopment Committee chair Marnie Doyle said the council has “throughly researched” the site and received extensive expert advice.

“Ipswich City Council sees a cinema offering in the Nicholas Street Precinct as an essential component of its activation and leasing strategies, following expert advice,” she said.

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“Council has considered correspondence from Limelight, in addition to discussions with its external leasing specialists, earlier advice from KPMG and feedback from a potential cinema operator for the precinct.

“Council believes a refurbished cinema complex will strengthen the city centre and add variety to the market.

“Prior to our development starting, the Birch Carroll and Coyle cinema operated at the same time as Limelight and as such retail specialist advice indicates that the market will be able to sustain both in Ipswich.”

Ms Doyle said the overhauled cinemas will be a “vital anchor” for the redeveloped CBD and the belief is it will benefit all nearby retailers, including those in Riverlink.

Upgrades will involve the addition of two extra cinemas to take the total in the complex to eight.

“It will be a vital component of the entire $250 million redevelopment,” she said.

“This isn’t a competing shopping centre, this is a cultural, leisure and business district which is complementary to and connected with Riverlink and Top of Town and will bring jobs, growth and investment back to Ipswich.”

Ipswich deputy mayor Marnie Doyle.
Ipswich deputy mayor Marnie Doyle.

Mr Entwistle said he understood the council was in a difficult position when it came to what to do with the building but believed what is planned is a mistake.

“Everyone’s desire, ours included, is to see a thriving and vibrant CBD,” he said.

“But when council says the retail component of this hinges on the success of the cinemas that worries us.

“I’ve been doing this for 35 years.

“There’s not a single precedent for the reinvigoration of a regional CBD cinema in circumstances where there’s a significant shopping centre (nearby).

“There are however, many precedents for the failure and ultimate closure of cinemas in those circumstances.

“There’s a lot of money involved in this. You’d want to be sure that it had some prospect of success.”

Read more stories by Lachlan McIvor here.

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