After more than a year of discussions and negotiations, entertainment giant National Amusements signed a deal with the University on Friday to occupy the former Sundance Cinemas site at 40th and Walnut streets.
The half-completed theater building, which was originally intended to be operated by Sundance, has been without a tenant since November of 2000, when Sundance -- the Robert Redford-led theater company -- pulled out of the deal following the financial demise of its partner, General Cinemas.
The new theater, which will be the second in National Amusements' "Cinebridge" line, is expected to open in November, and National Amusements has committed to staying at the site for at least 15 years.
University President Judith Rodin was effusive about the new deal's merits, speaking enthusiastically about what the cinema will bring to the neighborhood.
"It's a great long-term lease with a very important and highly-financed partner," Rodin said. "It adds tremendously to the 40th Street area and is a needed addition to our plans for animating that corridor."
And the "important and highly-financed partner" also seems pleased at the chance to continue the development of its Cinebridge concept.
"I was approached by the University to become involved in this project, and it seemed like the perfect opportunity," National Amusements President and Cinebridge Ventures CEO Shari Redstone said. "It was a real opportunity for us to expand."
Penn began discussions with National Amusements, among other operators, last spring, when the chain submitted a proposal to the University to develop the site. Since that time, University officials have declared that a deal was imminent no fewer than four times, the earliest back in August of 2001.
Back then, Executive Vice President John Fry anticipated a deal between Penn and National Amusements within 60 days, and he projected that the theater would open for business this spring.
Fry attributed the seemingly endless delays to several critical components of the lease that the two parties needed to work out.
"There were so many issues, from the sort of programmatic focus to the physical structures to who's going to pay for what," Fry said.
Rodin and Vice President for Facilities Services and Real Estate Services Omar Blaik said the delay also stemmed from the fact that the movie theater industry is in dire straits, with National Amusements as one of the only large chains currently financially healthy.
"We were in a period where almost every theater company had gone bankrupt or were on the brink," Rodin said. "The very thing in the cinema economy that made the first deal go badly also made other movie chains reluctant to get into negotiations with us or unable to."
Blaik said that the half-finished theater at 40th and Walnut streets was one of several sites nationwide stalled midway through construction, so "National Amusements was having a ball, looking at 20 [other] sites," he said.
National Amusements will pour millions of dollars into finishing the interior of the theater, according to Blaik.
The University, meanwhile, is responsible for completing the outside of the theater. Fifteen million dollars was already set aside for this purpose, and just last month, the University Board of Trustees approved an additional $13 million.
Both Blaik and National Amusements spokeswoman Jennifer Maguire Hanson refused to comment on the financial specifics of the deal, though, and other Penn administrators could not be reached for comment yesterday.
The theater is being designed by famed architect Dayna Lee, who also worked on Cinebridge's flagship theater in Los Angeles.
The theater will include six screens, stadium seating, a lounge and a "media immersion room," where patrons will be able to watch what is going on at that moment in other National Amusements cinemas worldwide.
The largest theater on site will seat 350 and will have the capacity to house live performances.
While University officials seem thrilled with the deal, National Amusements' plans for the site differ substantially from Sundance's original intentions.
Sundance envisioned the site as an arthouse theater on a grand scale, but National Amusements plans to show mostly mainstream films with a few successful independent movies mixed in.
While Sundance saw the large basement of the building as well-suited for a seventh theater, National Amusements has declined to use that space. Instead, Penn "has been thinking seriously of creating a film and video center" on the premises, Blaik said.
And while Sundance planned on occupying the entire 40th and Walnut complex and filling it with amenities such as a reflecting pool, a tapas bar, a lecture hall and an outdoor cafe, National Amusements will run only the theater.
Penn will lease the rest of the complex -- which includes space for two or three stores or restaurants -- to outside vendors starting in the summer of 2003, according to Blaik.
Retail operations proposed for the site include a restaurant, an entertainment venue and possibly a record store.
Fry said he would like to see a "restaurant that features music, maybe dancing, something that's more interactive than just a bunch of people having dinner."
According to Fry, the University's objective in planning out the retail landscape of the complex is to get people out on the street at all hours.
"Really what I want most of all [is] as many people outside as inside," Fry said. "I think that's the key."
Fry said the University will accomplish this by seeking out vendors that are "completely unique [in] the city of Philadelphia."
In the end, Blaik said, the theater complex will be "almost 100 percent of what the Sundance concept was." The only difference will be that Penn, rather than the theater operator, will be putting all the pieces together.
Fry expressed satisfaction with the final product, even though it will likely open almost two full years after Sundance and General Cinemas backed out of the project.
"I think we ended up better even with the delay," said Fry, who will leave Penn this year to become president of Franklin and Marshall College. "Out of the delay came a much better partner. [This theater concept is] just as good if not better than the Sundance concept but backed by a company that is extremely successful."
