Focus on selling cinema complex

The Tokoroa Cinema complex nearest competitors are 60km away - in Rotorua and Taupo.

New owner of Tokoroa's three screens and entertainment lounge could boost movie takings by going digital.

Tokoroa's cinema complex at 34-36 Logan St has been placed on the market for sale by negotiation as a freehold property and going concern business.

Noel Rogers, of Bayleys Manukau, and Brendon Bradley, of Bayleys Tauranga, are marketing the land, buildings and business comprising Tokoroa Cinema on the northern fringe of the town.

"Three years ago, the cinema passed into private ownership having been operated temporarily by the South Waikato District Council," Rogers says. "It is operated under management with all the major film distributors on side.

"Interest was expressed by a number of other potential buyers at the time of the sale in 2010. They had alternative plans for the movie complex and a collective sigh of relief went around the Tokoroa community when it remained operating as a cinema," Rogers says.

Today there are three screens operational in one part of the cinema. The remaining space is occupied by a TimeZone entertainment lounge.

Rogers says the Tokoroa Cinema screens are Cinema Scope offering optimal throw, width and height and are larger than those on offer in areas such as Whakatane, Rotorua and Taupo.

"A new owner could vastly improve the appeal of the cinema to the public along with increasing the takings of the complex, by converting the current 35mm film operating system to a digital platform and by introducing 3D capability.

"In its current form, the complex can only show movies in traditional film format which does limit the range of titles it has access to given that the movie world now almost exclusively uses digital format.

"Digital conversion and digital theatre management technology systems greatly streamline the operational side of any cinema complex as it does away with the notion of a projectionist and instead has an information technology skew.

"There are time and staff efficiencies inherent in a digital-based operational system."

Bradley says the cinema buildings total 610sq m on around 1011sq m of freehold land with ample carparking on the adjoining council carpark.

"In 2010, Statistics NZ figures taken from a Screen Industry Survey showed that a new record had been set for annual box office takings in this country when film exhibition revenue rose 6 per cent to $162 million," he says.

"This figure held steady in 2011/2012 being unchanged at $162 million in spite of online technology advances and Rugby World Cup distractions for two months of that period.

"In a provincial town like Tokoroa, with limited entertainment options on offer, the cinema becomes an important part of the community's life," says Bradley.

"The next closest cinemas are around 60km away in Rotorua and Taupo so there's a captive movie-going audience here in Tokoroa."

Bradley says the management has been a loyal supporter of community events and initiatives over the last three years. "They have provided a valued community service offering the premises as a venue for fund-raisers, and screening the Rugby World Cup final and high-profile boxing matches on the big screens."

Rogers and Bradley say there are a number of possible sale options for the cinema complex including a partial trade scenario, and they are welcoming inquiries from interested parties.

"We believe a new owner's investment in digital conversion would be well-received and would certainly bring Tokoroa into line with other centres that have the benefit of screening first-run movies soon after release."

What's on offer

For sale: Cinema Complex.
Where: 34-36 Logan St, Tokoroa.
Sales method: By negotiation.
Agents: Noel Rogers, of Bayleys Manukau, and Brendon Bradley, of Bayleys Tauranga.
* Only cinema in South Waikato town.
* Three screens and entertainment lounge.
* Potential to add value introducing digital and 3D.