The Arlington Theaters -- Arlington Heights' only cinema -- closed Sunday after negotiations for a new lease and the opportunity to upgrade the theater for the digital age fell through, said the theater's director of operations.
The closure affected 25 workers, said John Scaletta, who also is on the Arlington Heights village board.
Scaletta said he had been negotiating for about a year to renew the lease and install digital technology upgrades "in order to compete on a level playing ground" with other upgraded cinemas. But the negotiations fell through and the movie house was forced to close, he said.
"This has been a very, very tough situation for me, and I feel very bad for the staff and the community," Scaletta said.
Hollywood has been phasing out film in recent years, so celluloid is nearly extinct. And many suburban theaters nationwide are faced with some difficult and expensive upgrade decisions in the next 18 months, as Hollywood makes its final digital transformation. All movies coming out of Hollywood studios by late 2013 are expected to be fully digital and will require digital projectors and other equipment to display them in movie theaters, experts said.
The Arlington Theaters was the first tenant to open in 1999 at 53 S. Evergreen Ave. inside the Arlington Town Square, a downtown shopping district with a mix of shops and restaurants. They include Ann Taylor Loft, Bath & Body Works, Starbucks, Panera Bread, California Pizza Kitchen, JoS. A. Bank Clothiers and Noodles & Company, among others.
The property beneath the shopping district had seen its own share of troubles, including a foreclosure case in 2010.
At that time, 29 investment firms that backed Arlington Town Square were sued for missing payments on a $19.8 million mortgage.
The foreclosure case was filed in Cook County circuit court by WBCMT 2000-C33 Evergreen Avenue LLC, an affiliate of Miami Beach, Fla.-based LNR Partners Inc., the real estate firm and special servicer for the holder of the loan.
The 29 investment firms all had "Arlington Town Square LLC" in their titles preceded by a different name or other identifier.
A search of state records had shown those firms consisted of more than 50 individuals, family trusts and companies based in California, Idaho, New Mexico, Wisconsin, West Virginia, Hawaii, Florida, Tennessee and Utah.
LNR Partners, which still handles the property, referred comments on Monday to its local management firm, Oak Brook-based Edgemark Asset Management LLC, which did not immediately return phone calls.
Still, the village aims to fill the vacancy as soon as possible, said Charles Perkins, Arlington Heights director of planning and community development.
"We're making it a priority to find a replacement tenant and hope to get this resolved soon," Perkins said. "The restaurants and retailers depended on the traffic generated by the theater, so it will be greatly missed. And the theater also held various fundraisers there, so its reach goes well beyond its economic value."
"It's really sad to see such a nice meeting place and theater close," said Nancy Tsapralis, who owns the Dunton House with husband, Bill Tsapralis. "Everyone will suffer from it."
Closes: Village says finding new tenant a priority