Subject: ChicagoBusiness.com
From: Mary Deskovich (mdeskovich@yahoo.com)
Date: Thu May 24 2007 - 13:51:40 CDT
West Side draws Sundance Kid
Redford eyes Fannie May site for theaters
July 03, 2006
By Thomas A. Corfman
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Robert Redford's start-up movie theater chain is in talks to anchor a retail complex planned for the former Fannie May factory site on the Near West Side, a deal that would add celebrity glitz to a once-gritty area now brimming with new condos and townhouses.
Sundance Cinemas LLC is close to signing a letter of intent to open a six- to eight-screen theater in a 266,000-square-foot, multistory development proposed for the site just north of the Eisenhower Expressway and east of Racine Avenue, according to people familiar with the negotiations. A Chicago location would be a key step in a planned nationwide rollout of movie theaters featuring the artsy independent films and brainy documentaries that have gained wider popularity thanks in part to Mr. Redford's non-profit Sundance Film Festival.
A retail complex planned to replace this Near West Side candy factory could include an art house movie theater. Photo: Erik Unger
Sundance Cinemas was launched last year by Oaktree Capital Management LLC, a Los Angeles investment firm with $30 billion in assets, and Provo, Utah-based Sundance Group LLC, which oversees Mr. Redford's business interests, including a cable channel, a catalog company and a resort. Sundance has already signed theater deals in Madison, Wis., and San Francisco and is interested in the South Boston Waterfront, an area targeted for redevelopment.
"Sundance Cinemas is looking at many sites all across the country," says President and CEO Paul Richardson, declining further comment. Mr. Richardson is a former top executive with Los Angeles-based Landmark Theatres, the country's largest art house chain with 57 theaters nationwide, including the Century Centre Cinema at 2828 N. Clark St.
Negotiations started about a month ago between Sundance and a venture that includes two low-profile Chicago development firms, IBT Group LLC and Structured Development LLC, sources say.
"We are getting a really positive response from a lot of retailers. Unfortunately we're not at a point where we can disclose any of the names of the tenants that we are talking to," says IBT President Gary Pachucki. An announcement is expected "in the next short period of time," he adds. Michael Drew, a principal in Structured Development, declines comment.
DEVELOPMENT PLANS
The developers have been working on the project for nearly two years, after paying $12.2 million for the nearly four-acre site at 1137 W. Jackson Blvd, part of the liquidation of the historic Chicago candy company. Called Metro Center 290, to play up the location along Interstate 290, plans for the project also include a specialty grocery store and a health club.
Even so, the Near West Side would at first seem an odd choice for Sundance, compared with trendier neighborhoods such as Bucktown or Lincoln Park. In the late 1990s, as part of a failed first launch of the movie house chain with General Cinemas, Mr. Redford planned a theater at North and Clybourn avenues, but never went ahead with the deal.
But retailers are slowly following a West Side housing boom that's moving westward from Halsted Street's Greektown past the United Center.
"It's hard for some retailers to have the vision to imagine what this thing is going to look like when it's built, much less all the residential around it," says Paul Bryant, a principal in Oakbrook Terrace retail brokerage Mid-America Real Estate Corp., which isn't involved in the project.
In Madison, as part of the redevelopment of Hilldale Shopping Center, Sundance is planning a six-screen, 1,200-seat theater that would include a bar, restaurant and shop for Sundance-themed merchandise, says Andrew Stein, vice-president of development at Palatine real estate firm Joseph Freed & Associates LLC, which owns Hilldale. "Sundance is the premier name in independent art films. That's what we're banking on," he says. Announced in November, the theater is expected to be opened early next year.
©2006 by Crain Communications Inc.
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