The long-dormant Ritz cinema in downtown Escondido soon might be transformed into a three-story cabaret dinner theater, with five artisan lofts on a newly constructed top floor and parking and retail shops at street level.

The proposal by the cinema's new owner dovetails with recent efforts by the city and the Downtown Business Association to increase nightlife in downtown Escondido, which is mostly empty after dark.

"This would bring people down here to help create the 18-hour to 24-hour downtown we've been seeking," said Thora Guthrie, DBA chief executive. "It's really exciting."

But this is not the first proposal to remodel and re-open the cinema, which last showed movies in 1998. And there are many hurdles, such as scarce parking in the area and the estimated $2 million to $3 million price tag for renovations.

The City Council is scheduled to discuss the proposal Wednesday so the cinema's owner, Janie Maguire, can decide whether to move forward.

"I don't want to go through the whole approval process and have it rejected because of two (missing) parking spots or something ridiculous like that," said Maguire, an Escondido resident who bought the cinema from the Borough family in 2008.

The Boroughs also had planned to remodel and re-open the cinema when they bought it in 2003, but those plans never materialized.

Maguire said Monday that the key to reviving the cinema, which opened in 1937, is coming up with a more ambitious approach to operating it.

"The place has been unprofitable for so long that you don't really know what will work," Maguire said. "So our plan is to blend the old with the new."

Selling the artisan lofts would cover some of the renovation costs, and leasing retail shops on the ground floor would create a new revenue stream, she said.

The cabaret would be on a newly created mezzanine level, but it would still use the existing movie screen and some of the historic seats, Maguire said. It could host live theater, live music, weddings or fashion shows.

Her plan also includes a restaurant and martini bar, which could become a smoothie bar for children's birthday parties or other events geared for youth.

The proposal would increase the cinema's square footage from 8,400 to more than 24,000, because three floors would replace one.

Maguire said she's been excited to hear about recent plans by other developers to bring live music, dancing and other nightlife to downtown Escondido. She noted that her remodel has been in the planning stages since long before those other proposals became public.

Among other plans for new downtown nightlife are remodeling the 150 Grand restaurant into a jazz club and adding dancing at Tango, Vinz Wine Bar and El Nopal. Existing downtown nightlife includes a few restaurants, Pounders bar and Patio Playhouse, a small community theater.

In addition, an upscale Marriott with multiple bars and lounges is slated to open downtown in 2013.

Sue Dusharme of the DBA said another benefit of Maguire's plan would be to boost activity within the cinema's block, which is Grand Avenue between Juniper and Ivy streets. That block sits on the eastern end of downtown, where several businesses, including A Taste of Florence, have closed in recent years.

Barbara Redlitz, the city's planning chief, said city officials were upbeat about Maguire's proposal, but that it required some analysis of parking and other issues.

"It's a new concept that isn't really spelled out in our code," she said.

In addition, the building has historical significance, which could affect what Maguire is allowed to do.

The cinema flourished in the late 1930s and 1940s, with audience members sometimes playing keno between double-features. A fire closed the cinema in 1951, but it opened three years later with a higher ceiling and a rebuilt roof.

X-rated movies were shown in the early 1970s when it was called the Pussycat Theater, family movies were shown in the late 1970s when it was known as the Bijou, and Spanish-language movies were shown in the 1980s.

It was renamed the Big Screen Theater in 1993 and reverted to the Ritz in 1998, when it last operated. A previous remodel plan became more complicated in 2003 when a van plowed through the entrance and took out several rows of seats.

Call staff writer David Garrick at 760-740-5468.