Battle over seating at Lake Haven cinema

Metro Cinemas Lake Haven CEO John O’Neill has accused Central Coast Council of misleading the public on the reasons the cinema needs rental concessions.

Council granted a rent relief measure for the period February 1, 2023-January 31, 2024, at its last meeting, setting the rent at 15 per cent of the business’s monthly turnover and citing challenges in the broader cinema sector as the reason.

But O’Neill said the reason the cinema was losing custom was its outdated seating.

The cinema was built on behalf of Council with the needs of the youth of the northern Central Coast area in mind, with Metro Cinemas leasing the premises from Council with a 20-year lease.

Council owns the cinema fit out, other than projection and audio, and is responsible for its replacement.

O’Neill said a report to the Council meeting cited the downturn in the Australian cinema market as the reason for the rent relief; however the cinema market for 2022 for the Central Coast is up six per cent on the equivalent 2019 pre-pandemic period.

All that increase has gone to Event Tuggerah, where recliner seats have been installed, he said.

In November 2022, Metro Cinemas asked Council, as the landlord, to install recliner seating, as the existing seats had come to the end of their economic life, but was met with refusal.

“Under the terms of the lease Council is required to replace the seats when they come to the end of their economic life,” O’Neill said.

“The industry standard cinema seat is now a recliner seat, and we are losing substantial business to our opposition because of this.

“So, we have requested that Council replace the seats with recliners to enable us to compete.

“Not only is Metro Cinemas losing revenue and profit, but Council is losing substantial revenue through rent relief.

“While Council’s report cites estimated loss of rent at $50,000-70,000 per annum, the real number, given the substantial drop in admissions and revenue, will be more than $300,000 per annum.

“The rent relief for the six months ended December 31, 2022, alone was about $120,000.”

O’Neill said the report to Council’s January 24 meeting made no mention of the seating issue, instead blaming the downturn in patronage on general conditions in the cinema industry, which he said were actually improving on the Central Coast.

“I emailed the Administrator the morning before the meeting telling him Council’s report was misleading and requesting it be corrected,” he said.

“It is extremely disappointing that Council’s report was not corrected, and Mr Hart did not make the public aware of our request to replace the seats, which is the reason we require rent relief.

“I have requested a meeting with Mr Hart, which has been ignored.

“I will have no option other than to refer the matter to our lawyers.”

A spokesperson said Council considers the present seating to be adequate.

“Council supports the continuation of the Metro Cinemas at Lake Haven as a facility for the community to utilise and enjoy,” the spokesperson said.

“Council also appreciates the changing expectations of movie goers, including the need for it to be an affordable experience for all ages and demographics, and has resolved to reduce Metro Cinemas rent for a further 12 months.

“Council’s contractual obligation is to replace cinema seating at the end of its useful life.

“While at this time Council believes the current cinema seats are very adequate, should the operator wish to upgrade seating before the end of life, they are able to do that.”

Terry Collins