$3.7 mil deal for cinemas in 3 cities
SFG to build cinemas with US groupSHANGHAI -- Shanghai Film Group has signed a deal with Entertainment Properties Trust, a Kansas City, Missouri-based real estate investment trust to develop cinemas in three cities in China.
The three-year deal was signed Monday and sees the development of multiplex theaters in Shanghai, Ningbo and Xi'an as part of shopping mall complexes, said Ren Zhonglun, vice president of Shanghai Media Group and president of Shanghai Film Group.
Ren said that in accordance with Chinese law the foreign corporation would not be allowed majority ownership of the cinemas. The properties will instead be 51% held by SFG with EPR taking 49%. He estimated average cost at RMB25 million ($3.66 million) per complex, but said the precise financial commitment of the two sides will depend on the final size of the multiplexes.
SFG was one of the first companies to develop modern movie theaters in China and bought several of the cinemas sold by Warner Bros. International Theatres when it balked at the ownership regulations and pulled out of the country.