Lauren Do

I don’t know if the terms were made more generous after the Innovation Hall boosters started ragging on the City and City Council but this lease being offered seems entirely reasonable for the proposed business model and the space.  On the agenda for tomorrow night’s City Council meeting:

The proposed lease term is for 33 years, with one option to renew for an additional 33 years. For the first 33 years, rent will be fully abated to account for the capital improvements that need to be made to the buildings and the substantial cost of such improvements. “Starting 48 months after commencement of operations, the tenant must pay a fee on for-profit special events, in the amount of 2 percent of gross revenue generated from for-profit special events, after the first $300,000 (REVISED) earned.”

All capital improvement and construction projects are subject to prevailing wage and compliance relevant legal requirements, and the tenant must endeavor to negotiate an agreement to ensure labor peace prior to commencement of construction. Should the extension option be exercised by tenant, then starting in year 34, rent will equal two percent of the organization’s gross revenue, minus any income taxes paid by the tenant.

Also there are some reasonable community benefit benchmarks which must be met as well, which shouldn’t be difficult to accomplish:

Tenant is required to meet the following Community Benefit Benchmarks over the course of the lease term:

• A minimum of 200 youths (under 18) per year will participate in recurring course offerings.
• A minimum of 100 adults (18 and older) per year will participate in recurring course offerings.
• CIH will hold at least 10 community events per year with discounts available to Alameda residents for each event.
• CIH will hold at least 1 open house per year (free entry to learn about programs and events).
• CIH classes will offer at least 5 different course offerings for youths per year.
• CIH hours of operation for non-profit activities will be an average of 30 hours/week over at least 5 days/week.
• 10% discount on applicable fees for up to 36 events per year for Alameda community-based organizations and public entities (e.g., AUSD).
• 10% discount on applicable fees for Alameda residents.

Because one the worst things that could happen to this public building is to become a glorified wedding hall churning out event after event essentially getting free rent and the facility being closed to the public because of the need to recoup the $6.6 million investment.

 

from
https://laurendo.wordpress.com/2019/10/14/terms-of-engagement/