The owner of Waterfront Plaza is negotiating with prospective tenants to fill the 22,000-square-foot space that will become vacant when Restaurant Row 9 Theatres closes next month.

Lawrence Taff, executive vice president of Pacific Office Properties Trust Inc., confirmed his company was in talks with two parties, but said he could not disclose further details until negotiations were finalized. Taff said he expected a deal to be reached sometime next week.

Oregon-based Hollywood Theaters, which operates the multiplex in Waterfront Plaza, is accepting a buyout from its lease with landlord Pacific Office Properties. The theater's 40 employees were informed of the closing Monday.

The theater's original lease wasn't due to expire until 2034. However, in 2007, Hollywood Theaters President Scott Wallace entered into an agreement with Pacific Office Properties that allowed Pacific to end the contract in exchange for a cash payment.

Wallace had negotiated the original lease in 1993 with Bruce Stark, Waterfront's previous owner, that allowed Hollywood Theaters to lease the space for the next 40 years for $1 a year.

Wallace said the parking agreement, in addition to the changing face of the Plaza, were all factors in Hollywood accepting Pacific Office Properties' offer to leave the space where the theater had been operating since 1994.

"It's a lot of money," Wallace said in regards to the buyout from Pacific Properties.

According to Wallace, the theater's parking deal with Pacific Office Properties was hurting parking revenue in the surrounding neighborhood because anyone who bought a $1 theater ticket could get 3 1/2 hours of free parking validation.

"If you went to the federal building and paid for parking, it would be (a lot), but if you went, parked at Restaurant Row and bought a movie ticket, it would be $1, and you don't even have to watch the movie."

However, Taff said that parking was not an issue in the buyout of the lease.

Wallace also said the changing tenant mix in Waterfront Plaza also was a factor in his decision to close the theater. He noted a growing number of medical businesses in the complex, including a pharmacy that filled the space vacated by the Sunset Grill.

The Restaurant Row 9 Theatres are known as the "dollar" theater because that was the ticket price for many years. The theater in April raised its admission to $1.25 for a shows Monday through Thursday and for shows before 6 p.m. on Friday, Saturday and Sunday. Admission for evening shows on Friday, Saturday and Sunday was raised to $1.50.

Restaurant Row 9 Theatres will be selling the theater equipment, but would also be willing to donate to charities, Wallace said. Hollywood Theatres has no plans for any new discount theaters, he said.