Though it will host the Poppy Jasper Film Festival again this
year, downtown
’s historic Granada Theater’s days are numbered
n By Rose Meily staff writer
The Granada Theater will once again open its doors to serve as a venue for November’s Poppy Jasper Film Festival, but the long-term vision for downtown Morgan Hill’s landmark is bleak in the eyes of the theater’s landlord.
For the majority of the last two years, the Granada Theater has sat empty – its ticket booths vacant and doors locked tightly. Though it sprang to life for a short weekend during the Poppy Jasper Film Festival last year, it quickly faded back into obscurity amid the downtown streetscape.
Manou Mobedshahi, who leases the theater from owners Ed and Irene Enerson and owns the Downtown Mall and rear parking lot, will allow the film festival to use the theater again this November, but he doubts the Granada will stay a theater much longer.
“It is not in line with good business sense,” said Mobedshahi.
And he believes he has the facts to prove it.
“Surveys show only 13 percent of audiences go to movies,” Mobedshahi said. “The theater is a dying business because of home entertainment centers, DVDs, videos on command, the number of TV channels that people have access in their homes have hurt the theater business tremendously.”
Kim Bush, chairperson of the Poppy Jasper Film Festival, said she’s happy the young but successful festival will be able to return to the Granada again this year. Last year, Mobedshahi donated the use of the theater. The theater, with its 400 seats and two screens became the main venue of the festival. The festival was a big hit and 35 short films were shown at the theater.
“We’re glad for the use of the theater and we truly would love to see the Granada Theater open for the festival because I believe it will keep the community feeling of a film festival (held) downtown,” said Bush. “We’d truly love to see the Granada Theater open. People in Morgan Hill have a huge attachment to the theater, I don’t think I have seen a community with as much attachment to a theater.”
But Mobedshahi questions the community’s support of the historic theater.
“We have to be realistic about a theater in downtown. It was there and it flopped. We need a sustainable business,” Mobedshahi argued. “It’s not the right thing to do, even if the city offers money to help someone renovate it. It doesn’t matter where the money is coming from, or that there’s money there, it would be a waste to support a business that would not be profitable there.”
Downtown retailer Brad Jones, owner of Booksmart and Coffee Kaffee Vin, agrees with Mobedshahi that a theater downtown does not pencil out financially for people in the movie theater business, but he also laments what he calls “a lost opportunity” by the city to purchase the theater, renovate it and convert it to a community playhouse.
“The city had a good opportunity three to four years ago to rehabilitate it and turn it into a true community theater, instead, they built the playhouse by the community center,” said Jones. “It’s a nice building and I understand there is more parking there, but I think the city could have rehabilitated the theater for a lot less than what they spent on the new playhouse. It was the city’s last opportunity to really make sure we could keep the theater as a community asset and it would have had control over it.”
Jones added, “It’s a shame they can’t make it work, but something needs to happen even if it’s not viable for a theater. I would like to see something there. It’s like a big broken tooth in the middle of downtown.”
It would not have been viable for the city to undertake such a project, according to Business Assistance and Housing Services Director Garrett Toy, but he said the city would still like to see the Granada operate as a theater. Toy said at one time the Redevelopment Agency had offered about $1 million for the theater’s renovation when the city received a business proposal for the project, but that project fell by the wayside.
“Profit is a concern of the operation,” said Toy, “but we believe the structure is there to operate and still make a theater, if we can provide assistance to renovate it for an operator to run it and still make a profit.”
The only saving grace for the struggling theater could come in the form of a new owner.
John Telfer of South County Realty indicated there is an interested buyer for the theater and negotiations are going on, but he said he could not reveal any more details about the negotiations. Irene Enderson declined to discuss the negotiations. The theater is listed at $2 million.
Mobedshahi, however, doesn’t believe a new owner can change his plans for the building on which he has a 20-year lease with options.
“Studies show movie theaters make most of their money on just three or four of films each year,” Mobedshahi disclosed. “Other than that, every one of those (films) is a money loser. If you can’t run those first-run movies, and the Granada would lose out to a bigger operator like Cinelux, then it will fail. That’s the reality.”
Mobedshahi said he wants a business there that will succeed in the long-term. He envisions perhaps a restaurant or a combination restaurant and club, with function rooms and meeting rooms. Such an enterprise, he said, would be more successful than a movie theater.
“We don’t lack movie theaters,” he said. “They are available to us in Morgan Hill. There are plans for a multiplex on Cochrane Road. We have Cinelux and the others are just a few miles way; it’s not that we’re missing it.”
Mobedshahi, who is an immigrant from Iran, has had a proven track record in acquiring older buildings and restoring them into successful enterprises. According to Mainstreet Beat, the Morgan Hill Downtown Association newsletter, he purchased the historical Sherman House in San Francisco in 1980 and restored it into a five-star hotel and restaurant, which was featured in Architectural Digest. In 1989, he bought the Savoy Hotel on Geary Street and opened it as the Brasserie Savoy restaurant. In 1991, he purchased the St. Claire Hilton in downtown San Jose and in partnership with the San Jose Redevelopment Agency, restored it as the St. Claire Hyatt. In 1996, he bought the San Jose Hyatt and invested $22 million to completely renovate the hotel.
Mobedshahi is currently working on a mix-use proposal for a downtown project which will mean the demolition of the Downtown Mall and the construction of 30 condominiums and retail in its place.
“It will be beautiful,” he said. “It is what the city needs for its downtown.”
Rose Meily covers City Hall for the Morgan Hill Times. Reach her at 779-4106 ext. 201 or by e-mail at rm****@mo*************.com.
