Biz Buzz: Los Osos losing its Hollywood Video, too

A second Hollywood Video store is closing in San Luis Obispo County, this time in the shopping center that has the Ralph’s grocery store in Los Osos.

Hollywood Video parent company Movie Gallery, which filed for Chapter 11 bankruptcy last month, is also closing a store in San Luis Obispo.

The Los Osos store’s landlord, Matthew Orton of Solvang, said the last five months with the store “has been a nightmare.” First, Hollywood Video stopped paying the monthly $10,000 rent without an explanation, he said.

“We’ve spent thousands of dollars of legal fees trying to figure out what was going on,” Orton said. “They won’t even return a phone call.”

The only way Orton knew the Los Osos store was actually closing was when his sister saw a sign in the store window.

“I guess they’ve been a sinking ship for awhile,” Orton added. “This company had so much overhead with their big stores — mine was one of the smallest at 3,500 square feet — I don’t understand how they stayed in business this long.”

Hollywood Video has not said when the store will close. The Tribune has been unable to learn if any other Hollywood Video closures are in the offing in the county. Corporate officials will not comment, and company employees have been told not to talk to the media. The company is closing at least 760 stores nationwide — about a third of its total — as it attempts to restructure its debt, according to the firm’s Web site.

Orton doesn’t have a tenant lined up. Because of water restrictions that preclude opening new restaurants in Los Osos, he’s hoping for a drug store or a bank, he said.

Harold Wright, a Los Osos manufacturing engineer and self-proclaimed “video junkie,” e-mailed The Tribune about the closure.

“Guess I will need to join Netflix or use the Redbox,” he said, referring to the movies-by-mail service and the company with the red rental boxes located in grocery stores. According to Redbox’s Web site, the nearest location for a rental box is Morro Bay.

Los Osos used to have another movie rental business, Baywood Video Plus, but it went out of business about four years ago.

— Melanie Cleveland