St. Peter 5
ST. PETER, MN For a little more than three months, the marquee at the former St. Peter Cinema 5 Theater has had little to brag about since the owners of the business closed its doors Feb. 1. A deal is close to completion that will literally breath new life into the theater as the owners of Minneapolis-based company, CineMagic Theaters, have reached an agreement to purchase the facility with plans to reopen it, if all goes right, by Memorial Day weekend at the earliest.
Theater suitors near deal
By Kurt Hildebrandt
Staff Writer, St. Peter Herald
"It's probably the worst kept secret in St. Peter right now," CineMagic President and CEO Steve Tripp said. "We have signed a purchase agreement to buy the property and plans are for us to close on the property within the next 30 days. Once we close we'll need a good seven to 10 days to get the facility ready by doing some cleaning and much-needed repairs. At this point we are targeting having it open by the Memorial Day weekend, because in movie theater business that is a big weekend. Right now we're not sure if that's realistic, but we're hopeful it will work out. If we're not open that weekend, it would be shortly after that."
The St. Peter Economic Development Authority will be reviewing the sale at a meeting on Thursday because tax-increment financing (TIF) funds were used when the building was constructed in 1997. The city has been in negotiations about the remaining principle amount of $192,000 getting paid back to the city and the new owners have agreed upon terms in satisfying that debt on schedule.
"Through negotiations with the the proposed new owners, we have reached a deal where the city will be getting the principle back they put into the initial loan when the theater was built," St. Peter Community Development Director Russ Wille, the city's chief negotiator on the deal, said. "We just won't be getting back the seven-percent interest that was in the original financing."
A second note for up to, but not exceeding, $40,000 from the city to the new owners for the maintenance and repair work deemed necessary has also been requested and is expected to be acted on by the EDA. The loan, which was part of the negotiations, would be a no-interest loan that would be paid back through a balloon payment in three years.
"It's not like a revolving line of credit where it would be open for all three years," Wille said. "There would be a six to nine month window where they could request funds for those purposes and after that we'd close the doors on that money."
The EDA will vote on both matters Thursday and make a recommendation to the St. Peter City Council for possible consideration at Monday's (May 8) regular meeting.
"It appears as if these two have their primary financing in line and I'm optimistic that the EDA will make a recommendation for approval and it will be on the council agenda on Monday," Wille said. "Given the current situation the city is in with the building, I think this is a good deal for us."
"(If this goes through) it obviously is exciting news from the city's standpoint and personally I'm thrilled by it," St. Peter Mayor Tim Strand said. "We've met with these guys and they've proven they know what they're doing. I was impressed with them right from the start because they had a lot of good ideas on how this theater should be run. This city really misses having a movie theater and perhaps it took it being closed awhile for people to realize that. If this goes through, I'm confident the people of St. Peter and surrounding area will turn out to support it."
CineMagic up and coming
The company currently operates 42 screens in the Minnesota cities of Austin, Hutchinson and Rochester, as well as in Menomonie, Wis., and Okoboji, Iowa. They are also in the process of building a state-of-the-art Metropolitan Cineplex 15 theater in the St. Michael, Rogers and Albertville area (at intersection I-94 and Hwy. 241) with completion scheduled for this summer.
"With the new theater we are opening in St. Michael and once we acquire the St. Peter theater we will have 62 screens in seven cities," Tripp said. "We are very excited about getting set up in St. Peter and, in fact, we looked at opening up a theater there years ago prior to opening the one in Hutchinson. However, the former owners (of the St. Peter Cinema 5) ended up building the one we are buying before we could get one set up. At that time we were looking at a site across the highway from where it sits now, but it didn't work out. We spent a full day in St. Peter a couple weeks back and we absolutely believe there is a great market there. We believe if it is run properly and promoted actively it will do very well."
Tripp said he feels his company's experience with operating movie theaters in cities similar in size to St. Peter will be a real asset to the whole deal. "Bryan and I are Minnesota guys and both of us grew up in Worthington which is similar in size to St. Peter," Tripp said. "We've been together in this for about 10 years, but I've been in the theater business in some capacity for about 30 years and I hope to use that experience to make the St. Peter theater strong again." CineMagic is still in the process of assessing what kind of staffing will be needed, but they hope to start making hiring plans in the coming weeks provided everything goes as planned, according to Tripp.
Kurt Hildebrandt can be reached at firstname.lastname@example.org or 507-931-8568.