Spanish real estate developer GMR has announced a new cinema loop, Lux Cinemas GMR, with plans to open 16 new cinemas housing some 160 screens under the Lux brand in the next three years.
Lux will target well-heeled customers via VIP services. Total planned investment is some E27 million ($34 million).
The large question hanging over the announcement, however, is whether it reflects GMR’s real desire to build cinemas or rather an effort to build value for its exhibition investments — currently all channeled through its mainstream multiplex chain subsid Cinebox — in advance of a sale to a risk capital firm.
Terra Firma, a British private equity company, has already bought the UCI-Cinesa, Warner-Lusomundo and AMC chains in Spain.
Cinebox’s 30 Spanish plexes have been built in shopping malls. That at least affords them the loss-leading role of currying pass-through traffic for the commercial centers.
But with Lux, GMR is taking aim at richer patrons willing to spend more money on concessions and better facilities.
GMR’s gameplan for Lux also envisages using the cinemas to host conferences and presentations.
Adult audiences in Spain have flocked to select upscale titles, including Pedro Almodovar’s “Volver” and Woody Allen’s “Match Point.”
Yet annual box office gross per screen in Spain plunged from $205,366 in 2001 to $181,310 last year. B.O. has sputtered as screens multiplied dizzily, to 4,398 by the end of 2005.
Buzz in Spain’s exhibition sector is that Cinebox is on the sales block. At least with Lux, GMR seems willing to try another cinema circuit tack.