Movie theater chain Regal Cinemas has signed a new lease with Related for its Union Square location.
Regal and Related Companies on Wednesday announced in a news release a new long-term lease agreement for One Union Square South, which earlier this year had been set to close.
It’s a long-term deal, said Mooky Greidinger, CEO of Regal’s parent company Cineworld, which filed for Chapter 11 bankruptcy last year.
London-based Cineworld, which acquired the Regal chain for $3.6 billion in 2018, is the world’s second-largest movie theater group behind AMC.
Related constructed the complex at One Union Square South, which also includes a 27-story, 174,000-square-foot building with 239 residential units and retailers like Whole Foods and Nordstrom Rack, in 1998.
In 2020, it entered into an off-market deal to sell the residential component of the building for about $200 million to a firm representing an overseas buyer, The Real Deal reported.
That firm appeared to be New York-based MKF Realty, which purchased the property on behalf of Argentinian firm Raghsa Real Estate. Both MKF and Raghsa are run by members of the Khafif family.
The theater underwent a multimillion-dollar overhaul just before the pandemic shuttered screens across the U.S. for nearly a year, according to amNewYork. In bankruptcy filings, Cineworld noted the plunge in domestic box office sales during the pandemic, as well as the monthly rent increase of nearly 30 percent per theater from 2019 to 2022.
“In total, the debtors estimate that rejecting the leases will save their estates approximately $22 million annually,” one document stated.
The Manhattan theater’s lease was slated to be cut alongside over 30 others from Los Angeles to New York to Miami after its parent company in the U.K. declared bankruptcy, Variety initially reported, citing legal filings.
Movie theaters have had to reinvent themselves to compete with at-home streaming, which exploded during the pandemic. The Union Square theater boasts amenities including Dolby Atmos surround sound and a Pepsi 4DX auditorium with motion-synchronized seats, vibration, scents and simulated wind, fog, rain, lightning, snow and bubbles.
Its ScreenX 270-degree viewing auditorium expands the movie screen frame to the left and right walls of the screening room.
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