Metro Pulse/Insights/An Open Letter to Regal Cinemas

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Circling Market Square

Finding a way to revitalize Market Square without running roughshod over its property owners remains a key to success of the city's downtown redevelopment efforts. At times, this quest has looked like a squaring-the-circle exercise. But Deputy to the Mayor Frank Cagle insists it can be done.

"There's a plan in the works, and it's not the draconian disaster people think," Cagle says. "I believe we can work with the property owners to resolve it without creating a stink up there. It's got to be something people like and will support. John Elkington [the prospective master developer for the Square] has some good ideas, and he doesn't want to create any bad publicity either."

One of Memphis-based Elkington's good ideas is to involve Knoxville developer David Dewhirst as his partner. Dewhirst, who just happens to be Market Square's largest property owner, commands the respect of virtually all the others and can help overcome the biggest obstacles to a collaborative effort: namely, fear and mistrust.

In Dewhirst we trust.

—J.S.

by Joe Sullivan

Mr. Michael L. Campbell
Chairman & CEO
Regal Cinemas, Inc.

Dear Mr. Campbell,

This is in response to your letter to Mayor Victor Ashe opposing development of a cineplex in downtown Knoxville.

Your letter, which was also released to the media, represents a blatant attempt to thwart competition and is a slap in the face not only to the city's downtown redevelopment efforts, but also to the citizens of Knoxville. None of the self-serving, anti-competitive points you make, except for lamenting the plight of your failing industry, stand up under analysis. I would like to address them one by one.

You say that the success of downtown cinemas has been poor except in large cities that have densely populated downtown areas. But one need look no further than Chattanooga to find an example of a downtown cinema that is working very well.

According to Ken Hayes, president of the River City Co. that has spurred downtown Chattanooga's revitalization, you told him that a downtown cinema wouldn't work there either. However, Hayes says the seven-screen Carmike that opened there in 1996 has been highly successful and is now paying rent to the municipal authority that built it comparable to cinema rentals in suburban mall locations. He also attests that, "The value the community gets from Carmike being downtown goes far beyond the rent. It's given life to a lot more activity, especially in the evening hours and on weekends."

You allow for the possibility that downtown cinemas might succeed in cities that are under-screened or underserved. But you are oblivious to the fact that such is the case in Knoxville. Neither South Knoxvillians nor center city residents nor UT students have any cinemas accessible to them. To assume that they are supposed to drive to a mall or some other outpost in the western suburbs in order to go to a movie bespeaks a Marie Antoinette "Let them eat cake" posture on your part.

You say that "the proper ratio of residents per theater screen across the U.S. is one screen for every 10,000 residents...." Well, there are close to 90,000 residents in South Knox and the center city before we even get to thousands of other UT students who hang out in the campus area. That's enough to support a 10-screen cinema by your own standards.

The single most offensive statement in your letter is that, "Customers are not inclined to drive past...convenient, modern theaters to attend similarly appointed theaters in downtown areas." The only people who fit this profile are West Knox suburbanites to whom you have catered—excessively to judge by your hand-wringing about over-screened conditions in the burbs.

We don't begin to know what you did, or failed to do, to put your company on the brink of bankruptcy. But we do understand that desperate people tend to resort to desperate measures. Still, it's a shame to see the head of one of Knoxville's largest companies who's shown civic-mindedness in the past so devoid of it now.

The one legitimate complaint you might have is against city-subsidized competition. It's true that the Renaissance Knoxville plan calls for the city to incur the cost of a garage to support a downtown cineplex with free parking. However, it's my understanding that malls across the land are doing just that in order to land cinemas that pull in people who will eat and shop at the mall as well. The intent of the Renaissance Knoxville plan is just the same, and the city needs to show a return on its garage investment before proceeding.

In summary, your letter reminds me of the boy who murdered his parents and then appealed to the court for mercy because he was an orphan.

Sincerely,

Joe Sullivan