I was just looking through the list of the 145 stores in which Blockbuster (BBI) will be cancelling leases and closing as an initial step in their bankruptcy process. The list shows the monthly rent for each of these locations. A few of the rental figures caught my attention as being inordinately high and I discovered that the three highest monthly rents were found in stores in Los Angeles and Orange County. They are as follows:
- Santa Monica: $31,298 / month
- Irvine: $27,535 / month
- Lake Forest: $21,390 / month
That’s a lot of video rentals and microwave popcorn to sell.
I would be interested to know how much the “elimination” of late fees due to competitive pressures hurt Blockbuster financially. I had heard whispers several years ago that late fees made up something like 30% of store revenues (maybe that info is in their financial reports, who knows).
I am also interested to see what becomes of Blockbuster. I can’t really imagine a world with brick and mortar video rental stores in the age of streaming and on-demand services. Blockbuster has a ton of locations. I really doubt they are going to need most of them. Look for more lease cancellation announcements from Blockbuster in the near future.
You can see the list of store closures here.