A MAJOR leisure development will still go ahead despite one of its major attractions, Cineworld, reportedly facing insolvency proceedings.

The Northern Gateway Leisure Park, which is scheduled for completion next autumn at the cost of £65 million, will feature two drive-thru restaurants, a Travelodge, a Hollywood Bowl bowling alley, parking for 750 cars, and a 12-screen cinema complex.

But Cineworld’s fraught predicament was laid bare earlier this week when reports surfaced that the cinema giant was in £4 billion of debt, wracked up by the Covid-19 pandemic and damage payments owed to competitor Cineplex.

Despite the chain’s uncertain future, however, Colchester Council has said that it was happy with Cineworld’s financial position, adding it has contingency plans in place with other providers if Cineworld was forced to file for insolvency.

However, John Sullivan – who is the former chief executive officer of the drive-in cinema company Nightflix – said Colchester Council ought to have seen Cineworld’s struggles coming, citing an outmoded business model and the changing landscape of the entertainment industry.

He said: “[The Northern Gateway development] has been built to 90s standards – there used to be demand for megaplex cinemas because film studios were given exclusivity to films for six months.

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“That was a 20th century approach – that whole model has come under extreme threat because the studios cut the window from six months to three months, which meant the supply of film was diminishing and that the number of screens [in megaplex cinemas] is now excessive.

“Someone could have told you that in 2004.”

Responding to reports that Cineworld was in financial peril, a spokesman for Colchester Council said the Colchester Northern Gateway project would go ahead regardless of the future of Cineworld.

He said: “We await further updates from Cineworld UK, but it is still too early to speculate on the outcomes of any restructuring in their US business.

“We were satisfied with the company’s financial position at the time we completed contracts with Cineworld and are confident that we have adequate contingency measures in place with other providers to ensure the leisure offering at Colchester Northern Gateway will be delivered successfully.”

Cineworld employs a total of 5,000 staff throughout the UK.