Real Estate

Kerasotes ShowPlace Closes 10-Screen Theaters in Santa Clara, Mountain View

Kerasotes ShowPlace closes 20 screens in Silicon Valley, impacting local malls and commercial real estate.

By Doug Elli

7/11, 13:33 EDT
Brookfield Asset Management Inc

Key Takeaway

  • Kerasotes ShowPlace Theatres closed its 10-screen theaters in Santa Clara and Mountain View, impacting Westfield Valley Fair and The Village at San Antonio Center.
  • Landlords Unibail-Rodamco-Westfield and Brookfield Properties are actively seeking new operators to maintain the spaces as theaters.
  • The theater industry faces ongoing challenges from pandemic impacts and recent Hollywood strikes, affecting recovery efforts.

Kerasotes ShowPlace Theatres Shutters in Silicon Valley

Kerasotes ShowPlace Theatres, a venerable Chicago-based theater company, has recently closed two of its prominent locations in Silicon Valley, leaving landlords in Santa Clara and Mountain View scrambling to find new operators. The 10-screen ShowPlace Icon theater at Westfield Valley Fair in Santa Clara and another 10-screen theater at The Village at San Antonio Center in Mountain View have both gone dark. This move is part of a broader trend of closures by Kerasotes, which has been shutting down theaters across the U.S. The closures come at a time when the theater industry is grappling with the aftermath of the pandemic and ongoing labor strikes.

The Impact on Local Malls

The closure of these theaters is a significant blow to the shopping malls they anchored. The Westfield Valley Fair, which underwent a $1.1 billion upgrade in 2019, had specifically targeted Kerasotes ShowPlace Theatres to fill a key slot in its retail-restaurant hotspot. Similarly, The Village at San Antonio Center in Mountain View, owned by Brookfield Properties, had added the ShowPlace Icon in 2018. Brookfield Properties has expressed a desire to maintain the space as a theater and is actively seeking new operators. The loss of these theaters not only affects the malls' foot traffic but also poses challenges for the landlords in finding suitable replacements.

Struggles of the Theater Industry

The theater industry has been hit hard by multiple factors over the past few years. The pandemic led to prolonged shutdowns, and the industry has struggled to recover fully. The situation was further exacerbated by the Writers Guild of America strike in May of last year, followed by the Screen Actors Guild strike. These labor disputes have disrupted the production and release of new content, making it even harder for theaters to attract audiences. Kerasotes ShowPlace Theatres, which once boasted nearly 1,000 screens across the U.S., has been significantly downsized, operating just six theaters in five states as of 2021.

Broader Implications for Commercial Real Estate

The closure of Kerasotes ShowPlace Theatres in Silicon Valley is indicative of broader challenges facing the commercial real estate sector, particularly in retail and entertainment spaces. Shopping malls, which have already been under pressure due to the rise of e-commerce, are now grappling with the loss of key tenants like movie theaters. This trend could lead to a reevaluation of how these spaces are utilized, with landlords potentially exploring alternative uses such as mixed-use developments or experiential retail to attract visitors. The situation also underscores the need for flexibility and adaptability in commercial real estate strategies.

Management Quotes

  • Unidentified Brookfield Properties spokesperson:

    "We are in active discussions with prospective operators and our goal is to maintain the space as a theater."