Picturehouse would be ideal. The Ritzy and the Clapham Picturehouse are pretty close to each other, and often show different films to make sure they don't conflict. Could this model work for the Capitol?
I've also heard about the planning thing - something about the balcony being listed meaning it's basically impossible to convert the space into more than one screen? Tricky - but surely there's a way to make it work? Could it operate as a live music venue/cafe/cinema all in one?