The Hayward City Council bought the Cinemark movie theater and adjacent parking lot in the downtown for 8.5 million dollars. The vote was not unanimous with one no vote cast by Julie Roche and Ray Bonilla Jr. being absent. The main motivation for the yes vote was concerns with the large property’s vacancy and unresponsive, absent landlords.
Vacant buildings in the B Street corridor pose a problem for Hayward as they stay vacant for long periods of time, resulting in vandalism a draw for crime. Commercial property vacancy is an issue in the greater Bay area, in 2024 first quarter reports show an increase in vacancy to 36.7%.
Another issue is that when businesses are empty, you have a lower amount of foot traffic which hurts other surrounding businesses. In addition, as commercial property is vacated, we see examples such as Southland Mall where it is difficult to keep desirable stores because their success relies on other stores.
Concerns over tax revenue from businesses was also something that was taken into consideration during the purchase of Cinemark. Looking at surrounding areas, Hayward recognizes a trend that when you lose business, you lose city revenue. San Francisco estimates that loss of business may lead to 200 million dollars lost in taxes in 2028.
Opponents of the purchase are saying that the money could be spent on other public services. The city is responsible for providing citizens services, so many are concerned buying this theater for this cost is taking money from accomodating residents’ needs.
The theater is generating a profit, the Assistant City Manager Dustin Claussen said in 2022 they had a $634,000 gain. The city is looking at reconfiguring the theater to include live events and to draw in college students. In the long term they will get an independent property manager to operate the theater.
This is an unusual move as cities tend to not engage in purchasing commercial property. Many cities are nervous about taxpayers suing over private purchases and not taking care of the residents’ needs. Hayward’s goal is to revitalize the B Street corridor and has decided that the plan is a good step forward.
