HomeMy WebLinkAboutPavilion Building (2005-2007) April 10,2006 Renton City Council Minutes Page 104.
Expressing his disagreement, Mr. Law stated that public safety is the City's
responsibility. He indicated that the City needs to prioritize how its resources
are allocated, and pointed out that all of the downtown marketing is for naught
if people feel intimidated.
Council President Corman reported that this subject reminds him of other code
enforcement issues for which City ordinances were updated to provide the
enforcement tools. Updated ordinances may be needed to address intimidation,
threats,and other unacceptable activities. The City Attorney stated that a
number of those activities are already covered by City ordinances, and noted
that if an individual who was threatened refuses to cooperate, the case cannot
be prosecuted.
Mr. Quincy added that the presence of an officer inhibits the inappropriate
behavior. In regards to hiring security, he stated that the behavior is not
occurring inside the building,but rather outside of the building.
Councilman Persson commented that many businesses are affected by the
unruly behavior,and stressed that the City wants people to feel safe when they;
go to downtown Renton. Mayor Keolker emphasized that the City is still
working on the matter, and is reviewing the design elements of the transit
center, as well as the positioning of bus route offload locations.
Community Services: Cinema ' Turning to the subject of the Cinema on the Piazza event held on Saturday
on the Piazza,Alternate evenings during the summer,Mr. Persson asked Eric Temple,President of the
Location Spirit of Washington, if he is willing to provide$20,000 for this event. Mr.
Net` Temple confirmed that he is offering the funding now that Valley Medical
�aI Vi I 1-0-Y1 �l�-�J Center has indicated that they will not sponsor the event in 2006. He stated his
hope that the cinema event can be held at a location that does not conflict with
the Pavilion Building event center.
Council President Corman explained that the question before Council concerns
the City's position on whether to continue having the cinema event at the Piazza
or at an alternate location. He noted that events at the Piazza may conflict with
the showing of the movie or vice versa. Mr. Corman expressed his support for
moving the cinema event to another location.
Mayor Keolker stated that the Administration distributed information to
Council regarding this issue, and pointed out that in the City's Pavilion Building
lease with the Spirit of Washington it is noted that the Cinema on the Piazza
event is an allowed use. She indicated that it has not yet been shown that there
• will be a conflict. Mayor Keolker advised that if Council wants to move the
event, the location will most likely be Liberty Park.
Continuing, the Mayor explained that the event was designed to draw people to
the downtown area. Liberty Park is a bigger venue; however, she noted that the
event may affect the baseball games held at the park, and will conflict with the
Saturday of the River bays festival. Mayor Keolker also shared the concerns of
the Piazza Renton volunteer group.
Councilman Clawson stated that it is not known if there will be a conflict, and
he suggested waiting to see what will happen this summer. If there is a
problem, the lease can be renegotiated. Councilwoman Briere said she attended
an event at the Piazza Building that coincided with an event that had a band at
the park, and she could not hear the band from inside the building.
April 10,2006 Renton City Council Minutes Page 105
Councilman Persson commented that Renton's image may be hurt if people
attending one of the coinciding events have a bad experience. He pointed out
that people may want to sit on the grass to watch the movie, such as at Liberty
Park,rather than on the cement at the Piazza.
Councilwoman Palmer expressed her support for having the event at Liberty
Park, saying that she prefers sitting on the grass. She also noted that the park
has a play area for children.
Councilman Law noted that parking could be an issue for coinciding events,
and that the event center has been successful in drawing a lot of people to the
downtown area. He indicated that the$40,000 cost for the cinema event should
be shared with the business community. Mr. Law favored finding another
location for this popular event.
MOVED BY CORMAN, SECONDED BY LAW, COUNCIL SUPPORT
FINDING AN ALTERNATE LOCATION FOR THE CINEMA EVENT.*
Councilman Clawson expressed his support for keeping the event at its present
location, saying that it can be relocated if problems occur.
*ROLL CALL: FOUR AYES: CORMAN, PERSSON, PALMER,LAW;
TWO NAYS: BRIERE, CLAWSON. MOTION CARRIED.
•
Mayor Keolker stated that the Administration will bring back a
recommendation to Council. Councilwoman Briere asked the Administration to
also review funding source options for the cinema event. (See page 106 for
further discussion on this matter.)
CONSENT AGENDA Items on the consent agenda are adopted by one motion which follows the
listing. At the request of Council President Corman,Item 5.h. was removed for
separate consideration.
Council Meeting Minutes of Approval of Council meeting minutes of 4/3/2006. Council concur.
4/3/2006
Appointment: Municipal Arts Mayor Keolker appointed Kristi Hand, 517 Smithers Ave. N.,Renton, 98055,
Commission to the Municipal Arts Commission to fill the unexpired term of Jeremy
Chambers, who has resigned(term to expire 12/31/2006). Refer to Community
Services Committee.
CAG: 06-023,Airport#790 City Clerk reported bid opening on 3/23/2006 for CAG-06-023,Airport
Building Construction,Lincoln Quonset Hut Building#790 Construction; three bids; engineer's estimate
Construction $50,000; and submitted staff recommendation to award the contract to low
bidder,Lincoln Construction,Inc., in the amount of$129,851 (budgeted
amount$42,000). Refer to Transportation (Aviation) Committee for discussion
of funding.
CAG: 06-039,Water Main City Clerk reported bid opening on 3/28/2006 for CAG-06-039,Water Main
Replacement; VJM Replacement Project-N. 31st,N. 33rd, and NE 24th Streets; six bids;
Construction engineer's estimate$237,314.56; and submitted staff recommendation to award
the contract to low bidder,VJM Construction Co.,Inc., in the amount of
$270,749.02. Council concur.
Annexation: Akers Farms, Economic Development,Neighborhoods and Strategic Planning Department
108th Ave SE&Puget Dr S recommended a public hearing be set on 4/24/2006 to consider the proposed
Akers Farms Annexation and R-8 zoning of 13.3 acres located south of Puget
Dr. S. and east of 108th Ave. SE, if extended. Council concur.
8r,tdo(,ncr`1
REC1V
APR
• <51. ECONOMIC DEVELOPMENT, 1 0 2006
C.) �� NEIGHBORHOODS, AND STRATEGIO Y OF R :N;ON
• ha ♦ PLANNING DEPARTMENT SPR
MEMORANDUM ary o R .°-FIQE
DATE: April 10, 2006 ('& "°Aj
TO: Randy Corman, Council President
Members of the Renton City Council
VIA: Kathy Keolker,Mayorg4...
FROM: Alex Pietsch, Administrator
SUBJECT: CINEMA ON THE PIAZZA
ISSUE:
Due to the withdrawal of a key corporate sponsorship, supplemental funding is required
for the Cinema on the Piazza outdoor movie series if it is to continue for a fourth year.
Additionally, questionshave been raised about the compatibility of the Cinema on the
Piazza and private events scheduled in the adjacent Spirit of Washington Events Center.
RECOMMEDATION:
The Administration recommends allocation of$20,000 of unallocated year-end fund
balance to the"Downtown Activities"fund in the Non-departmental Budget. This
supplemental allocation, combined with the$20,000 established in that fund through the
adoption of the 2006 Budget will allow the Cinema on the Piazza to continue for a fourth
consecutive year. If supplemental funding is allocated, the City Council should
determine the appropriate location for the event, either the Piazza or Liberty Park.
BACKGROUND SUMMARY:
In 2003, the Renton Community Marketing Campaign, a partnership between the City,
Renton School District,Renton Technical College,Valley Medical Center, Greater
Renton Chamber of Commerce and Renton Visitors' Connection, established an outdoor
movie series in the Piazza Park as a way to enliven Downtown Renton. The event proved
successful as hundreds of families gathered each Saturday night in July and August.
The event was funded with$20,000 from the"Downtown Activities" fund in the Non-
departmental Budget and through the Community Marketing Campaign's annual budget.
The event continued in 2004 with the"Downtown Activities" and Marketing Campaign
contributions offset by sponsorship from several local businesses.
In 2005, Valley Medical Center agreed to provide a key sponsorship for the Cinema on
the Piazza providing$20,000 for naming rights and other benefits. This, combined with
the"Downtown Activities"fund was enough to fund the event. While the Community
h:\ednsp\council\issue papers-agenda bills-ctte reports\2006\cinema budget memo.doc
Renton City Council
Page 2 of 2
April 10,2006
Marketing Campaign continued to sanction and support the event, no stakeholder funds
(other than the $20,000 in the City's "Downtown Activities"fund) were involved in its
production in 2005.
Valley Medical Center has indicated that it will not sponsor the event for 2006.
Therefore, if it is to continue for a fourth year, additional funding is necessary. However,
there is sufficient 2005 year-end fund balance that could be allocated to "Downtown
Activities"fund to make up for the lost sponsorship.
In 2005,the City entered into a;lease with the Spirit of Washington Dinner Train to
operate the Pavilion Building as an event center as the Spirit of Washington Events
Center("SWEC"). The SWEC indicates that it has events scheduled each Saturday night
in July and August in 2006. Concerns have been raised about the compatibility of the
outdoor movies and events that are scheduled inside the SWEC.
Staff has analyzed a number of potential alternative locations for this event series.No
other Downtown location appears feasible. Liberty Park has emerged as the best option if
the City Council were to consider relocating the movie series.
CONCLUSION:
The Cinema on the Piazza has become a popular community event. Additional funding is
necessary ensure its continuation this year. If the City Council chooses to allocate
additional funds, a determination should be made as to where the event should be held.
cc: Jay Covington
Terry Higashiyama
Michael Bailey
is\correspondence\mayor\cinema issue paper 041006.doc
(V5( 0 CITY `)F RENTON
ty a Mayor
�j � Kathy Keolker
•
CITY OF RENTON
April 3,2006
APR 1 1 2006
Ms. Carole Anderson,President RECEIVED
Valley Medical Center CITY CLERK'S OFFICE
Board of Directors
400 South 43`d Street
Renton, WA 98055
Dear Ms. Anderson:
I was surprised and saddened to learn that Valley Medical Center may be considering withdrawal of its
support for our upcoming outdoor movie series,the Valley Medical Center Cinema on the Piazza.I'm
writing to clarify the City's commitment to this event and to encourage your continued participation.
The Cinema has become an incredibly popular communityevent.For the past two summers,hundreds of
families have filled the Piazza in Downtown Renton to watch movies on Saturday nights.It has truly been
rewarding to see so many people of all ages gather in a place that we all worked so hard to create as a
focal point for downtown revitalization.
Last year,Valley Medical Center joined us as.the principalsponsor of this event.Your contribution of
$20,000,combined with$20,000 of City funding,made the free movie series possible.Your staff
indicated to us that Valley Medical Center was pleased with the exposure that sponsorship provided the
hospital,particularly as you went in to your levy election.
Following that success,staff of our two organizations met last fall and agreed the partnership should
continue in 2006.Based on that agreement,,the City Administration recommended and the Connell
approved$20;000 for this purpose in its,'2006 Budget.Many of the annual calendars of events diet the
City and other agencies produce have been printed showing the Valley Medical Cinema on the Piazza as a
highlight of the summer.
Now,just as we were preparing to discuss specific plans and goals with your marketing staff for this
year's movie series,we find that you arediscussing whether or not VMC will, in fact, sponsor the event
this year. We regret that this discussion has emerged so late in the planning process and we're hopeful
that any questions can be answered and misunderstandings can be rectified so that the Cinema.can
continue this year.
I would be happy to discuss this matter with you.Please feel free to call me at(425)430-6500 at your
convenience.
Sincerely,
Kathy Keolker _
Mayor
cc: Renton City Council
Rich Roodman,Valley Medical Center
Joyce Shaw, Valley Medical Center
1055 South Grady Way-Renton,Washington 98055-(425)430-6500/FAX.(425).430-6523 RENTON
AHEAD OF THE CURVE
Thic naror rnntainr rill°/r enn-Ind malarial'VOL...................,...
cVal1ey Mccal Center CITY OF RENTON
. • Where you are the center
APR 1 1 2006
CITY araiBFFIGg
April 6, 2006
Mayor Kathy Keolker
City of Renton
1055 South Grady Way
Renton,Washington 98055
Dear Mayor Keolker:
Thanks for taking the time to visit with our Board and Administration on Tuesday. I believe we
all understood the issues as you explained them in your letter, as well as in the dialogue that
transpired at the Board of Commissioners meeting.
After you left, there was considerable discussion regarding Valley's outreach programs within the
community as well as the intent and precedent that we have tried to maintain. For example,
during the past couple of years, the medical center has contributed $50,000 to the Renton
Communities in Schools program, $10,000 to RAYS (Renton Area Youth &Family Services,
$41,600 to the Renton School District for acquisition of AED's (automated external defibrillators)
and most recently has stepped up to take on a significant role in the Cast for Kids program.
While all of these programs reflect Valley's ongoing contribution to the Renton community, they
also reflect our precedent of being"one-time only contributions,"as opposed to ongoing annual
support. After further reflection, the Board reaffirmed the medical center's position that Valley
will not be participating in the Cinema on the Piazza program in 2006, the same position that Erin
Lippincott, Marketing Manager for Community Relations, initially reported to Alex Pietsch last fall,
and Joyce Shaw, Director of Marketing and Community Relations, confirmed to Alex last week
when he called to ask if we would be continuing this sponsorship this coming summer.
We look forward to working with the city in a variety of ways in the future. We will, however,
not be participating in the Cinema on the Piazza during 2006.
Best regards,
ki(hc/ ,:
Rich Roodman
c: Board of Commissioners
April 10,2006 Renton City Council Minutes Page 103
' facilities to campaign for or against any ballot initiative; however,the City can
provide strictly factual information such as property damage statistics. He
indicated that elected officials and City staff can campaign on their own time.
Councilmembers made suggestions as to what type of organizations Ms.
Madson can contact, and what she can do to help support the fireworks ban. It
was also suggested that at a future meeting, Council invite speakers to speak for
and against this initiative.
Citizen Comment: Temple- Eric Temple,President of the Spirit of Washington, 625 S.4th St.,Renton,
Pavilion Building/Downtown 98055, spoke on the topic of public safety, saying that an assault occurred over
Transit Center Safety the weekend at the Pavilion Building, which is used as an event center. He
Concerns commented that public safety in the downtown area has been an ongoing issue,
and he asked that the City take stronger action.
Citizen Comment: Quincy- Don Quincy, Spirit of Washington Food and Beverage Director, 625 S. 4th St.,
Pavilion Building/Downtown Renton, 98055,reported that he and a client were assaulted on April 8th at the
Transit Center Safety Pavilion Building by 15 kids walking through the parking lot. He asked for
Concerns more police presence in the area,noting that he personally patrols the area to
try to ensure that his clients and employees are safe. He described the unruly
behavior, which occurs on a daily basis at the Renton Transit Center, as well as
past incidents, including verbal abuse, fights, and thefts that have affected
Pavilion Building events and clients. Expressing his concern for the safety of
his employees and clients,Mr. Quincy asked for more help.
Interim Police Chief Kevin Milosevich reported that police responded to the
assault on April 8th in approximately 80 seconds. The parties involved were
identified; however,Mr. Quincy chose not to press charges. The client who
was also assaulted was unable to identify the perpetrator. Interim Chief
Milosevich stated that a tremendous amount of staff time has been spent on the
subject of transit center safety. He encouraged people who witness unruly
behavior to call 911, and to also be willing to prosecute in cases such as this.
In response to Councilman Law's inquiry, Interim Chief Milosevich reviewed
when and how officers patrol the area. He acknowledged the Mayor's efforts in
working with King County Metro on this issue, and noted the importance of
drawing people to the downtown area. Mr. Law suggested that the police
coordinate with the event center, and he asked about the enforcement of
inappropriate behavior.
City Attorney Warren stated that enforcement can be difficult as there is a fine
line between free speech rights and violating the law. He noted that a number
of statutes, such as loitering, have been found to be unconstitutional. Mr.
Warren indicated that he will continue to work with the Police Department to
see if there are additional ways to expand the City's authority.
Councilman Law stated than an environment needs to be created whereby
unruly activities are not welcome, and he suggested the possibility of allocating
overtime for a stronger police presence.
Councilman Clawson indicated that when a large group of people is involved,
the promoters of events often hire police or security guards. He commented
that Spirit of Washington is leasing the building from the City at a reasonable
rate. Noting that more police officers are needed all over the City,Mr.
Clawson suggested that perhaps Spirit of Washington can also contribute by
hiring security for the events.
April 10,2006 Renton City Council Minutes Page 104
Expressing his disagreement,Mr.Law stated that public safety is the City's
responsibility. He indicated that the City needs to prioritize how its resources
are allocated, and pointed out that all of the downtown marketing is for naught
if people feel intimidated.
Council President Corman reported that this subject reminds him of other code
enforcement issues for which City ordinances were updated to provide the
enforcement tools. Updated ordinances may be needed to address intimidation,
threats, and other unacceptable activities. The City Attorney stated that a
number of those activities are already covered by City ordinances, and noted
that if an individual who was threatened refuses to cooperate, the case cannot
be prosecuted.
Mr. Quincy added that the presence of an officer inhibits the inappropriate
behavior. In regards to hiring security,he stated that the behavior is not
occurring inside the building,but rather outside of the building.
Councilman Persson commented that many businesses are affected by the
unruly behavior,and stressed that the City wants people to feel safe when they
go to downtown Renton. Mayor Keolker emphasized that the City is still
working on the matter,and is reviewing the design elements of the transit
center, as well as the positioning of bus route offload locations.
Community Services: Cinema Turning to the subject of the Cinema on the Piazza event held on Saturday
on the Piazza, Alternate evenings during the summer, Mr. Persson asked Eric Temple,President of the
Location Spirit of Washington, if he is willing to provide$20,000 for this event. Mr.
Temple confirmed that he is offering the funding now that Valley Medical
Center has indicated that they will not sponsor the event in 2006. He stated his
hope that the cinema event can be held at a location that does not conflict with
the Pavilion Building event center.
Council President Corman explained that the question before Council concerns
• the City's position on whether to continue having the cinema event at the Piazza
or at an alternate location. He noted that events at the Piazza may conflict with
the showing of the movie or vice versa. Mr. Corman expressed his support for
moving the cinema event to another location.
Mayor Keolker stated that the Administration distributed information to
Council regarding this issue, and pointed out that in the City's Pavilion Building
lease with the Spirit of Washington it is noted that the Cinema on the Piazza
event is an allowed use. She indicated that it has not yet been shown that there
will be a conflict. Mayor Keolker advised that if Council wants to move the
event, the location will most likely be Liberty Park.
Continuing, the Mayor explained that the event was designed to draw people to
the downtown area. Liberty Park is a bigger venue; however, she noted that the
event may affect the baseball games held at the park, and will conflict with the
Saturday of the River Days festival. Mayor Keolker also shared the concerns of
the Piazza Renton volunteer group.
Councilman Clawson stated that it is not known if there will be a conflict, and
he suggested waiting to see what will happen this summer. If there is a
problem, the lease can be renegotiated. Councilwoman Briere said she attended
an event at the Piazza Building that coincided with an event that had a band at
the park, and she could not hear the band from inside the building.
January 9,2006 Renton City Council Minutes \ Page 7
AUDIENCE COMMENT John A. Hansen, 1108 Anacortes Ave. NE, Renton, 98059, complained of
Citizen Comment: Hansen - severe noise disturbances from the nearby Arbors apartment complex when
Noise Complaint, Arbor garbage is transferred from small containers to a compactor. He noted that he
Apartment Complex has measured the level of noise that transpires approximately 150 feet from his
residence at up to 95 decibels. Mr.Hansen indicated that he has contacted the
police and code compliance concerning the matter,but the problem has yet to
be solved. He emphasized that the elimination of the noise disturbance will
greatly improve the quality of life of the affected residents.
Mayor Keolker pointed out that this item is listed on the agenda under
correspondence,and noted that she also received a letter from Mr. Hansen prior
to the holidays, which she referred to staff. The Mayor invited Principal
Planner Jennifer Henning to report on the matter.
Ms. Henning explained that staff received Mr. Hansen's complaint in May
2005, and the code compliance inspector conducted site visits over the course
of three weeks. The inspector did observe the incident one time, and while the
disturbance was annoying and loud, it did not violate current code. She noted
that staff has been in contact with the apartment management. Ms. Henning
indicated that some small changes to the proposed nuisance ordinance, which is
now under review, may help with the enforcement of these types of
disturbances.
MOVED BY CORMAN, SECONDED BY LAW, COUNCIL REFER THE
CORRESPONDENCE TO THE ADMINISTRATION. CARRIED.
Citizen Comment: Baumann - Marsha Baumann,4325 NE 11th St.,Renton, 98059, noted that the noise
Noise Complaint,Arbor disturbances referred to by the previous speaker are shocking, irritating, and
Apartment Complex occur three to five times a week. She stated that the neighborhood endured a
lot of noise during the storm sewer drainage rebuild project,but the banging
produced by this disturbance is even louder. Ms.Baumann asked the City to
•
help resolve this problem.
Citizen Comment: Temple- Eric Temple,President of the Spirit of Washington, 625 S. 4th St.,Renton,
Pavilion Building Lease, Spirit . 98055, commented on the success he has had in marketing the Pavilion
of Washington Building for use as a venue for meetings and events, both locally and
internationally, since the lease for the building was executed with the City last
July. He reported that 31 events were held in 2005 and 85 events are already
scheduled for 2006. Mr. Temple noted the conflict that occurs with the Cinema
in the Piazza event that is held on Saturday nights during the summer and the
coinciding events held in the Pavilion Building.
On another subject,Mr. Temple announced that he recently joined the King
County Boys and Girls Club Board of Directors, and that a fundraiser will be
held for the Renton Skyway club in April.
Councilman Law praised Mr. Temple and his staff for the way events are
handled at the Pavilion Building.
CONSENT AGENDA Items on the consent agenda are adopted by one motion which follows the
listing. Item 8.o. was removed for separate consideration.
Council Meeting Minutes of Approval of Council meeting minutes of 12/12/2005. Council concur.
12/12/2005
Pam it tin NI) ,
RECEIVED
OCT 0 4 2005
PIAZZA RENTON
PO BOX 1471 Renton City Council
RENTON, WA 98057
October 4, 2005
CITY OF RENTON
OCT 1 7 2005
RECEIVED
To: Mayor Kathy Keolker-Wheeler CITY CLERK'S OFFICE
CC: Renton City Council members Briere, Clawson, Corman, Law,
Nelson, Palmer, and Persson
Subject: Open public use of the downtown Piazza
The purpose of this memo is to ask our Renton City officials to assure our
volunteer organization members and Renton area residents in general that
the downtown Piazza will remain an open to the public park.
We are concerned that with the Pavilion being leased to private business that
undue restrictions could be placed upon public use of the park. Of most
concern to us is continuation of the four major events Piazza Renton holds
annually at the Piazza site, and the Farmer's Market and Cinema on the
Piazza both held during the summer months.
The Piazza is a wonderful addition to the downtown area and the above
mentioned activities bring life and vitality to our city center on a very
broad basis. The diversity of area residents who participate in the above
activities is truly amazing.
Thank you for your continuing support and understanding.
9AD41,1_,A1,3A,24.
Jl*
ne Se Jim Medzegian
President, Piazza Renton Vice president, Piazza Renton
Piazza Renton is a 501(a) non profit organization
August 1,2005 Renton City Council Minutes Page 274
Transportation(Aviation) Transportation(Aviation) Committee Chair Palmer presented a report
Committee recommending concurrence in the staff recommendation to adopt the annual
Transportation: 2006-2011 TIP update of the Six-Year Transportation Improvement Program(TIP), 2006-2011,
and the Arterial Street Plan. The proposed TIP includes four new projects:
Rainier Ave. (S.4th Pl. to S. 2nd St.);Hardie Ave. SW Transit/Multi-Modal;
May Creek Bridge Replacement; and School Zone Sign Upgrades. Six
completed or cancelled projects were dropped from the program. The
Committee further recommended that the resolution regarding this matter be
presented for reading and adoption. MOVED BY PALMER, SECONDED BY
PERSSON, COUNCIL CONCUR IN THE COMMITTEE REPORT.
CARRIED. (See below for resolution.)
RESOLUTIONS AND The following resolutions were presented for reading and adoption:
ORDINANCES
Resolution#3762 A resolution was read updating the City's Six-Year Transportation
Transportation: 2006-2011 TIP Improvement Program,2006-2011. MOVED BY CLAWSON, SECONDED
BY NELSON,COUNCIL ADOPT THE RESOLUTION AS READ.
CARRIED.
Added A resolution was read authorizing the Mayor and City Clerk to enter into an
Resolution#3763 interlocal cooperative agreement with King County regarding the Community
Human Services: 2006-2008 Development Block Grant Program. MOVED BY NELSON, SECONDED BY
CDBG Interlocal Agreement, PALMER, COUNCIL ADOPT THE RESOLUTION AS READ. CARRIED.
King County •
The following ordinance was presented for first reading and referred to the
Council meeting of 8/8/2005 for second and final reading:
Transportation: Street Closure An ordinance was read amending Section 9-9-3 of Chapter 9, Street Closure, of
Ordinance Title IX(Public Ways and Property)of City Code by allowing road closures of
one day or less to be governed by administrative action. MOVED BY
PERSSON, SECONDED BY CORMAN,COUNCIL REFER THE
ORDINANCE FOR SECOND AND FINAL READING ON 8/8/2005.
CARRIED.
The following ordinance was presented for second and final reading and
adoption:
Ordinance#5151 An ordinance was read amending Section 4-1-220,Property Tax Exemption for
Planning: Multi-Family Multi-Family Housing in Residential Targeted Areas,of Chapter 1,
Housing Property Tax Administration and Enforcement, of Title IV(Development Regulations) of
Exemption Modifications City Code by modifying the designated residential targeted areas and other
project eligibility requirements. MOVED BY LAW,SECONDED BY
CLAWSON, COUNCIL ADOPT THE ORDINANCE AS READ. ROLL •
CALL: ALL AYES. CARRIED.
NEW BUSINESS Referring to the 2006 Budget schedule,Council President Briere expressed
Budget: 2006 Schedule concern regarding the review of fees and rates and the associated ordinances
prior to the presentation of the budget to Council. Discussion ensued
concerning the timing of the approval of any proposed fee and rate ordinance.
Mayor Keolker-Wheeler stated that the budget schedule will be reviewed.
Council: Information Request Councilman Persson requested status reports on the following items: the hiring
on Various Issues of a new librarian; the proposed parks maintenance facility; the Skyway
r�\fh trA Towing court case; the prostitution arrests at massage parlors and related City
`� f August 1,2005 Renton City Council Minutes _ Page 275
Attorney vouchers; and the replacement of broken window glass at the Pavilion
Buildin and whether the glass was defective and under warranty.
Policy: Bidding and MOVED BY PERSSON, SECONDED BY CORMAN, COUNCIL REFER
Contracting Requirements THE POLICY ON CONTRACTS TO THE FINANCE COMMITTEE.*
(#250-02) In response to Mayor and staff inquiry,Councilman Persson clarified that he
wants a general discussion on the contract policy,including how contracts are
handled and how they are reported to the Council.
*MOTION CARRIED.
Council: Committee of the Council President Briere announced that Committee of the Whole will meet on
Whole,Annexation Policy 8/9/2005,from 2:00 p.m. to 5:00 p.m.,in the Council Conference Room to
(8/9/2005) discuss annexation policy.
EXECUTIVE SESSION MOVED BY BRIERE, SECONDED BY NELSON, COUNCIL RECESS INTO
AND ADJOURNMENT EXECUTIVE SESSION FOR APPROXIMATELY 30 MINUTES TO
DISCUSS LITIGATION WITH NO OFFICIAL ACTION TO BE TAKEN
AND THAT THE COUNCIL MEETING BE ADJOURNED WHEN THE
EXECUTIVE SESSION IS ADJOURNED. CARRIED. Time: 8:45 p.m.
Executive session was conducted. There was no action taken. The executive
session and the Council meeting adjourned at 9:16 p.m.
Bonnie I.Walton, CMC,City Clerk
Recorder: Michele Neumann
August 1,2005
July 11,2005 Renton City Council Minutes Page 246
projects to the Sound Transit project list and for Sound Transit to provide
funding for these projects. The two Sound Transit committees supported
going forward with this proposal. The proposal will be presented to the
Eastside Transportation Partnership and the South King County
Transportation Board in August in the hopes of bringing it to the Sound
Transit Board for action in September.
AUDIENCE COMMENT James Magnuson, 523 Union Ave.NE,Renton, 98059, stated that he is unable
Citizen Comment: Magnuson- to obtain building permits for his subdivision project at NE 12th St. and
Highlands Sub-Area Plan Monroe Ave.NE due to the moratorium on new development in the Highlands
Study Area Moratorium, Sub-Area Plan study area. He noted that restrictive covenants established in
Exemption Request 1949 restrict the lot size on the property;thus,potential future higher density
requirements will not affect the property. Mr. Magnuson requested an
exemption from the moratorium.
Mayor Keolker-Wheeler stated that the Administration is currently reviewing
the issue of the restrictive covenants,and assured that Mr. Magnuson's situation
will also be reviewed.
Councilman Persson expressed the need to resolve this issue. Mayor Keolker-
Wheeler confirmed that the Administration will report back to Council as soon
as possible with a proposed solution.
Citizen Comment: Johnson- Arland "Buzz" Johnson,334 Wells Ave. S.,#306,Renton, 98055,expressed
Wells Ave S Speeding Traffic concern regarding the speeding traffic on Wells Ave. S. by the Spencer Court
Apartments where he lives. He suggested the installation of a crosswalk or a
stop sign to ensure the safety of pedestrians.
Mayor Keolker-Wheeler stated that the matter will be investigated.
Citizen Comment: Temple- Eric Temple, 625 S. 4th St.,Renton,98055,thanked the City for entering into
Pavilion Building Lease, the lease with the Spirit of Washington for the Pavilion Building. He pointed
BNSF Rail Corridor Purchase out that a number of people have expressed interest in using the facility.
by King County On another subject,Mr. Temple noted that King County representatives will
brief Committee of the Whole on July 18th on the issue of King County's
potential acquisition of a rail corridor from Burlington Northern Santa Fe
(BNSF)Railway. Mr. Temple indicated that he has discussed the issue with
King County several times,and feels an understanding has been reached with
regards to the Spirit of Washington Dinner Train. He expressed his support for
the King County Council's action to enter into exclusive negotiations with
BNSF to purchase the rail corridor.
In response to the Mayor's inquiry concerning high capacity transit,Mr. Temple
stated that overhead trackage rights are to be part of the negotiations.
Councilman Corman indicated that some sections of the rail corridor are
appropriate for high speed rail in the future; however, it is not appropriate for
the section that goes through downtown Renton where high speed rail would be
better placed to run along the freeway corridor.
Mayor Keolker-Wheeler expressed her concern regarding high capacity transit
running through downtown Renton, and stated that Council will be provided
with background information on the matter prior to the Committee of the
•
Whole meeting.
June 27,2005 - Renton City Council Minutes , Page 235
Airport: Bosair Lease, Transportation Systems Division recommended approval of Addendum#4 to
Addendum#4,LAG-86-003 LAG-86-003, airport lease with Bosair,LLC, for a rent increase from
$15,890.29 to$17,602.34($.31 to$.3434 per square foot)annually,which will
remain in effect until 6/1/2010. Council concur.
Airport: Kaynan Lease, Transportation Systems Division recommended approval of Addendum#11 to
Addendum#11,LAG-84-003 LAG-84-003, airport lease with Kaynan,Inc.,for a rent increase from
$23,894.76 to$26,808.86($.3276 to$.3385 per square foot)annually, which
will remain in effect until 6/1/2008. Council concur.
Transportation: Supplemental Transportation Systems Division requested approval to adopt the supplemental
Street Lighting Standard for street lighting standard for arterial street lighting. Refer to Transportation
Arterial Street Lighting (Aviation)Committee.
Airport: T-Hangar Lease Rate Transportation Systems Division requested approval of a rent increase for all T-
Increase Hangar units at the Airport to$285 per month plus leasehold excise tax,and
approval to apply the Seattle/Tacoma Consumer Price Index every three years
to the rental rate. Refer to Transportation(Aviation)Committee.
Vacation: N 14th St,Pool Utility Systems Division reported submittal of the appraisal performed for the
Brothers Construction,VAC- vacation of a portion of N. 14th St. (VAC-05-001; Pool Brothers Construction),
05-001 and requested that Council accept the appraisal and set compensation for the
right-of-way at$21,285. Refer to Planning and Development Committee.
MOVED BY PERSSON, SECONDED BY LAW,COUNCIL APPROVE THE
CONSENT AGENDA AS AMENDED TO REMOVE ITEM 7.d.FOR
SEPARATE CONSIDERATION. CARRIED.
Separate Consideration Economic Development,Neighborhoods and Strategic Planning Department
Item 7.d. recommended approval of a lease with Spirit of Washington,Inc. to use the
EDNSP: Pavilion Building Pavilion Building for meeting and event space.
Lease, Spirit of Washington Councilman Clawson expressed concern regarding the restroom facilities,as
the Pavilion Building restrooms would not be available for those attending
events such as the Farmers Market at the Piazza if an event at the Pavilion
Building occurred at the same time.
Responding to Councilman Clawson's inquiry,Economic Development
Administrator Alex Pietsch stated that the cost of providing a portable toilet is
approximately$100. He noted that the restroom facility at the Renton Transit
Center is available for use.
Councilwoman Nelson expressed the need for a portable toilet if there is a
conflict with the Farmers Market. Councilwoman Palmer also noted the need
for a portable toilet if there is a conflict with the Cinema on the Piazza event on
Saturday nights.
Councilman Clawson stated his support for the lease,noting that the City will
benefit from the Spirit of Washington Dinner Train's advertising. Mr.Pietsch
pointed out that the term of the Pavilion Building lease is ten years, with a
provision for termination at the end of four years.
Mayor Keolker-Wheeler expressed her hope that this venue will attract larger
events to downtown Renton,and not take events away from existing City
facilities and other venders. She praised City staff for all their hard work on the
lease, with special thanks to Mr. Pietsch and Economic Development Specialist
Mark Santos-Johnson.
June 27,2005 Renton City Council Minutes Page 236
MOVED BY CLAWSON,SECONDED BY LAW, COUNCIL APPROVE
CONSENT AGENDA ITEM 7.d. AS PRESENTED. CARRIED.
Added A letter was read from Charles D. Grass, CPA&Associates,PO Box 2563,
CORRESPONDENCE Renton, 98056, concerning the effect of the NE Sunset Blvd. and Duvall Ave.
Citizen Comment: Grass-NE NE Intersection Improvements Project on his property located at 10733 138th
Sunset Blvd &Duvall Ave NE Ave. SE(1625 Duvall Ave.NE). He pointed out that the changes will restrict
Intersection Improvements the current use of his property,reducing the parking availability by 50%.
Project,Property Use MOVED BY PERSSON, SECONDED BY PALMER,COUNCIL REFER
Restriction THIS CORRESPONDENCE TO THE ADMINISTRATION. CARRIED.
UNFINISHED BUSINESS Finance Committee Chair Persson presented a report recommending
Finance Committee concurrence in the staff recommendation to approve the annual renewal of the
Human Resources: 2005 Group Health Cooperative medical coverage agreements as follows: LEOFF 1
Group Health Cooperative (Law Enforcement Officers and Fire Fighters)Employees (Contract No.
Medical Coverage Contracts 0390400);LEOFF 1 Retirees (Contract Nos. 0057500 and 4057500); and all
other City of Renton covered employees (Contract No. 1162600). Funding was
previously approved by Council in the 2005 Budget. The revisions are
applicable to all four of the renewal contracts. As in prior years, Group Health
does not send confirming contracts for signature until mid year.
The Committee further recommended that the Mayor and City Clerk be
authorized to execute the contracts. MOVED BY PERSSON,SECONDED BY
NELSON, COUNCIL CONCUR IN THE COMMITTEE REPORT.
CARRIED.
Finance: Vouchers Finance Committee Chair Persson presented a report recommending approval
of Claim Vouchers 238477-238901 and two wire transfers totaling
$1,973,672.06;and approval of Payroll Vouchers 57758 -58108,one wire
transfer,and 582 direct deposits totaling$1,914,771.09. MOVED BY
PERSSON, SECONDED BY NELSON,COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Transportation(Aviation) Transportation(Aviation)Committee Chair Palmer presented a report
Committee recommending concurrence in the staff recommendation to approve the Renton
Airport: Development Study Municipal Airport Development Study with a modification to policy
recommendation number four from"Permit scheduled seaplane operations from
the City of Renton" to "Accept proposals from scheduled seaplane operators."
The Committee further recommended authorizing staff to further explore
implementation of the recommendations listed therein. MOVED BY
PALMER, SECONDED BY PERSSON, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Planning&Development Planning and Development Committee Chair Clawson presented a report
Committee regarding the designated residential targeted areas modification and the text
Planning: Multi-Family amendments to the Multi-Family Housing Property Tax Exemption program.
Housing Property Tax The Committee recommended concurrence in the recommendation of staff that
Exemption Modifications Council:
1) Approve the modification to the Urban Center North District 1 (UC-N1)
designated residential targeted area to add the Commercial Office
Residential 3 (COR 3)zone; and
e
Cl_ : OF RENTON COUNCIL AGENDA•
�_LL
• AI#: (s'
Submitting Data: For Agenda of: 6/27/2005
Dept/Div/Board.. EDNSP
Staff Contact Mark Santos-Johnson Agenda Status
Ext. 6584 Consent X.
Subject: Public Hearing..
Pavilion Building Lease with Spirit of Washington Correspondence..
Ordinance
Resolution
Old Business
Exhibits: ! New Business
Issue Paper Study Sessions
Draft Lease Information
•
Recommended Action: Approvals:
Council Concur Legal Dept
Finance Dept
Other
Fiscal Impact:
Expenditure Required... N/A Transfer/Amendment N/A
Amount Budgeted N/A I Revenue Generated Base rent&
percentage rent
projected at an
average of
$88,100 per
year over years
1 thru 5
Total Project Budget N/A City Share Total Project.. N/A
SUMMARY OF ACTION:
On February 14, 2005, the Committee of the Whole directed staff to negotiate a Pavilion Building
lease with the Spirit of Washington to'use the building on a short-term basis for meeting and event
space. On May 23, 2005, EDNSP staff presented to the Committee of the Whole the general terms of
the proposed Pavilion Building lease with the Spirit of Washington. Staff has concluded lease
negotiations with the Spirit of Washington and recommends the City Council's approval of the lease.
STAFF RECOMMENDATION:
Approve the Pavilion Building lease with the Spirit of Washington and authorize the Mayor and City
Clerk to execute the lease in substantially the form as approved by the City Council.
��y ECONOMIC DEVELOPMENT,
U NEIGHBORHOODS, AND STRATEGIC
' PLANNING DEPARTMENT
MEMORANDUM
DATE: June 20, 2006
TO: Terri Briere, Council President
Members of the Renton City Council
VIA: Kathy Keolker-Wheeler,Mayor
u
FROM: Alex Pietsch,Administrator
STAFF CONTACT: Mark Santos-Johnson,Economic Development Specialist
Ext. 6584
SUBJECT: Pavilion Building Lease with Spirit of Washington
ISSUE:
Should the City enter into a lease with the Spirit of Washington to use the Pavilion
Building for meeting and event space?
RECOMMENDATION:
EDNSP recommends that the City Council approve the Pavilion Building lease with the
Spirit of Washington and authorize the Mayor and City Clerk to execute the lease in
substantially the form as approved by the City Council.
BACKGROUND SUMMARY:
On February 14, 2005,the Committee of the Whole directed staff to negotiate a Pavilion
Building lease with the Spirit of Washington on a short-term basis for meeting and event
space. On May 23, 2005,EDNSP staff presented to the Committee of the Whole the
general terms of the proposed Pavilion Building lease with the Spirit of Washington.
Staff has concluded lease negotiations with the Spirit of Washington and recommends the
City Council's approval of the lease.
The lease will provide the Spirit of Washington,Inc. with exclusive use of the facility for
meeting and event space, except for limited City use of the facility and limited use of the
Pavilion Building restrooms for Piazza events. The lease is for a 10-year term with the
ability for the City or Spirit of Washington to terminate with 12-months notice effective
on or after four years subject to certain limitations. The building will function as an open
hall with minimal tenant improvements,paid for by the Spirit of Washington.
h:\ednsp\council\issue papers-agenda bills-ctte reports\2005\issuepaper-pavilion building spirit of washington lease 6-
20-05.doc
Pavilion Building Lease wi'._ ,jirit of Washington
Page 2 of 2
June 20,2005
The Spirit of Washington rent will pay the City a base rent (Year 1 - $15K, Year 2-
$30K, and Years 3 or more-$36K), plus 35% of facility rental revenue and 15% of
catering revenue. Over the first 5 years, the base rent to the City is $153,000($3.19/sf, or
an average of$30,600/year) and total projected rent(including base rent and projected
percentage rent)would be$440,499 ($9.18/sf, or an average of$88,100/year).
The Spirit of Washington projects 130 events (or approximately 14,300 visitors) for first
year with 5% annual growth thereafter.
Please refer to the attached Pavilion Building Lease with the Spirit of Washington—Key
Lease Terms for a summary of the major lease terms.
CONCLUSION:
The Pavilion Building lease with the Spirit of Washington supports the City's ongoing
efforts to revitalize downtown Renton. The lease with the Spirit of Washington will
provide revenue to the City while using the Pavilion Building to attract thousands of
users or attendees to downtown Renton. The agreement also allows the City to terminate
the lease in order to use the Pavilion Building for a non-event use or(subject to various
conditions)potentially another event use with twelve months notice effective any time on
or after the end of the fourth year.
Attachments: Pavilion Building Lease with the Spirit of Washington—Key Lease Terms
Pavilion Building Draft Lease
cc: Jay Covington,CAO
Bonnie Walton,City Clerk
Michael Wilson,Interim FIS Administrator
Dennis Culp,Community Services Administrator
Peter Renner,Facilities Director
Ben Wolters,Economic Development Director
•
h:\ednsp\council\issue papers-agenda bills-ctte reports\2005\issuepaper-pavilion building spirit of washington lease 6-
20-05.doc
•
Pavilion Building Lease with Spirit of Washington,Inc.
Key Lease Terms
June 22,2005
Overview
• The Spirit of Washington Inc. (SOW) will lease the entire Pavilion Building.
• SOW will have exclusive use of the+facility for meeting and event space, except for limited City
use of the facility and limited use of the Pavilion Building restrooms for Piazza events as
described below.
• 10-year term with the ability for the City or SOW to terminate with 12-months notice effective
on or after four years with limitations as described below.
• The building will function as an open hall with minimal tenant improvements,paid for by SOW.
• SOW will pay the City a base rent(Year 1 -$15,000,Year 2-$30,000 and Years 3 or more-
$36,000),plus 35% of facility rental revenue and 15% of catering revenue.
• SOW projects 130 events (or approximately 14,300 visitors)for first year with 5% annual growth
thereafter. Performance standards(described below)equal 70% to 80% of projected figures.
• Over the first 5 years,base rent to the City would be a total of$153,000($3.19/sf,or an average
of$30,600/year) and total projected rent(including base rent and projected percentage rent)
would be$440,499($9.18/sf, or an average of$88,100/year).
Tenant Improvements
• SOW will pay for any tenant improvements. To date, SOW plans to install carpet, window
coverings, a lounge area and coat check and moveable planters with trees.
Rent
• Base Rent: First three months free. The next three months are$1,000/month. The next twelve
. months are$2,000/month. Thereafter,the base rent is$3,000/month.
• Revenue Sharing:
• 35% of gross room rental charges and 15% of gross catering sales, including food,beverages
and Lessee-provided audio visual systems,linens,flowers, tables, chairs,flatware, china and
the like).
• Excludes gratuities,taxes, on-site labor charges and all facility or restroom rental revenue(but
not catering sales revenue,if applicable)from City use of the Pavilion Building or Piazza
event use of the Pavilion Building restrooms.
Maintenance and Utilities
• SOW is responsible for maintenance and custodial work for the Pavilion Building and for all
Pavilion Building utilities.
Pavilion Building Lease with Spirit _s,i ashington
Key Lease Terms—June 22,2005
Page 2 of 4 •
City is responsible for all exterior damage,maintenance and repairs to the Pavilion Building,
unless caused by SOW's use of the premise.
■ City is responsible for failures to major equipment,building systems or structural components
unless damage related to SOW's acts or omissions.
■ SOW is not responsible for maintenance or custodial work related to the adjacent uses (Piazza
park, public parking lot,Transit Center or parking garage)unless damage or extraordinary trash
attributed to SOW.
City-Use of Pavilion Building
• City may schedule up to 12 City-sponsored events per year at Pavilion Building at rates noted
below. (Additional events subject to availability at market rates.)
• SOW to provide access and custodial services for a$250 base fee plus $35/hour per event. SOW
has exclusive right to provide all additional services (catering,tables, chairs,etc.)to City at
market rates.
• Unless otherwise approved by SOW, City may not schedule events on Friday evenings,
Saturdays, Sundays and holidays (except during Renton River Days and for the Holiday Tree
Lighting festivities).
• City may schedule up to 36 events per year in the Piazza Park(e.g.,Renton Farmer's Market'and
Cinema on the Piazza)where SOW will allow use of Pavilion Building restrooms for a$50 fee
per event.
• City will open,monitor,clean,restock and lock the Pavilion Building restrooms for each such
use.
• SOW has the right to schedule other uses at the Pavilion Building on said dates and to exclude
Piazza event access to the restrooms with 30 days notice to the City.
• If there is a conflict with a Pavilion Building event, the Piazza events will need to secure
alternative temporary restroom facilities,if desired.
Piazza Events
• City retains right to schedule Piazza events at any time. However, after annual schedule
established, City will attempt to coordinate additional dates with SOW events at the Pavilion
Building.
• Pavilion Building users may occupy a portion of the Piazza Park for incidental use(but not place
tables, tents,barricades,etc. that restrict public access to the Piazza Park)
• For any other use, SOW or Pavilion Building users will need to secure approval of Renton Park
Board.
Pavilion Building Lease with Spirit _ Jashington 1'
Key Lease Terms—June 22,2005
Page 3 of 4
Miscellaneous Provisions
• SOW is responsible for providing liability insurance,excluding City use of the Pavilion Building
and use of the Pavilion Building restroom for Piazza events.
• City is responsible for providing property insurance at full replacement value.
• SOW is responsible for payment of the leasehold excise tax, state business and occupation tax
and sales tax.
• SOW will provide a$10,000 security deposit to be placed into an escrow account for potential
damages to the facility.
• City to provide SOW four spaces with signage in the adjacent public parking lot.
Early-Termination
• After three years, SOW may terminate the lease for any reason with 12-months notice(effective
on or later than the end of the fourth year of the lease).
• After three years, City may terminate the lease for another non-event use with 12-months notice
(effective on or later than the end of the fourth year of the lease).
• If SOW continually meets the performance standards noted below,City may not terminate lease
for another event use.
Months 1 thru 12 No performance measure
Months 13 thru 24 No performance measure
Months 25 thru 36 110 Events
Months 37 thru 48 120 Events
Months 49 thru 60 125 Events
Months 61 thru 72 130 Events
Months 73 thru 84 .135 Events
Months 85 thru 96 140 Events
Months 97 thru 108 145 Events
Months 109 thru 120 150 Events
f
Pavilion Building Lease with Spirit-._._. .Washington
Key Lease Terms—June 22,2005
Page 4 of 4
▪ An"event" is defined as a revenue generating use of the Pavilion Building for a: (i)block of time
of at least 1 Y2 hours each with 40 or more attendees,including,for example, a banquet,
reception,meeting,dance, fundraiser or the like; or(ii) a breakfast or lunch meeting with 40 or
more attendees. However, a function with multiple elements on the same day with the same user,
will only count as one event(e.g., a prom banquet followed by a dance).
• If SOW fails to meet a performance standard, City may terminate the lease with 12-months
notice for another event use(effective on or later than the end of the fourth year of the lease).
However, the City or the new tenant must pay SOW the then-applicable buy-out to cover the
residual value of SOW's capital and up-front marketing costs as described below.
• SOW projects to spend approximately$76,000 on non-moveable capital costs, approximately
$118,000 for moveable capital costs and approximately$159,000 for up-front marketing costs as
outlined in Exhibit D. The actual costs may vary plus or minus 10%for each category above,but
the total costs to be recognized by the City for depreciation as part of the buy-out provision
cannot exceed$355,000.
• The annual depreciation and residual amounts for SOW's capital costs and up-front marketing
costs are outlined in Exhibit D. However, the maximum buy-out that would apply if SOW failed
to meet a performance standard and the City terminated the lease for another for event use would
be:
Months 1 thru 48 Not applicable
Months 49 thru 60 $220,000
Months 61 thru 72 $185,000
Months 73 thru 84 $150,000
Months 85 thru 96 $115,000
Months 97 thru 108 $105,000
•
Months 109 thru 120 $95,000
At end of the ten(10)-year Lease Term: Not Applicable
• The above depreciation schedule reflects start-up marketing costs depreciated over six years and
capital costs depreciated over 10 years,with a value of 40%remaining in capital costs residual
value at the end of year 10. After 10 years, the City or a new operator(if SOW is replaced)
would get all non-moveable capital costs and the moveable capital costs would be available for a
then-negotiated price,not to exceed$52,000,if desired.
•
Pavilion Building Lease
Revised Draft (6/21/2005)
ARTICLE 1. BASIC TERMS
This Article 1 contains the Basic Terms of this Lease between the Lessor and Lessee named
below. Other Articles, Sections, Subsections and Paragraphs of the Lease referred to in this
Article 1 explain and define the Basic Terms and are to be read in conjunction with the Basic
Terms.
Section 1.1 Date of Lease:
June 30, 2005
Section 1.2 Lessor:
City of Renton(the"City")
1055 South Grady Way
Renton,WA 98055
425-430-6500
Section 1.3 Lessee:
Spirit of Washington Inc.
625 S.4th St.
Renton,WA 98055
425-277-8408
Subsection 1.3.1 Lessee's Address at Time of Execution of Lease:
625 S. 4th St
Renton,WA 98055
Subsection 1.3.2 Address of Property to be Leased by Lessee:
Pavilion Building
233 Burnett Avenue South
Renton,WA 98055
Section 1.4 Property Legal Description:
The object of this Lease is the Lessor's real property development known as Pavilion Building
(a.k.a. the Renton Events Pavilion) and is described in Exhibit "A," Legal Description, attached
hereto and incorporated herein by this reference as if fully set forth (the "Project"). The Project
includes the land, the buildings' and all other improvements located V on the land with the
exceptions noted below. The Property being leased to Lessee is further described as:
J"
•
Pavilion Building Lease - 2 '
The Pavilion Building, as depicted in Exhibit "B," Project Site Plan, attached hereto and
incorporated herein by this reference as if fully set forth, including approximately 2,500 square
feet of patio space located on the west end of the Pavilion Building and approximately 860
square feet of patio space located on the east end of the Pavilion Building.
Notwithstanding the legal description included in Exhibit "A," Legal Description, the Property
being leased to Lessee does not include the parking lot or any other exterior space on the north
side of the Pavilion Building, the public sidewalk on the west side of the building, the public
sidewalk on the east sides of the building or the Piazza Park or any other exterior space on the
south side of the Pavilion Building.
The leased property is sometimes referred to herein as the "Property" and sometimes as the
"Leased Premises" or"Premises."
Section 1.5 Characterization of Property:
Lessor shall provide Lessee with a set of "as-built" architectural drawings, plus the 0 & M
documentation, for the Pavilion Building from the renovation completed by Lessor in 2004.
Lessee acknowledges that the floor in the open hall of the Pavilion Building has load rating
design restrictions that limit the amount of weight that can be supported by the floor as specified
in Exhibit"C,"Floor Load Rating Specifications, attached hereto and incorporated herein by this
reference as if fully set forth. For any vehicle and for any use that involves a load requirement
that may be in excess of the "stringerless" specifications in the attached Exhibit "C," Floor Load
Rating Specifications, Lessee shall consult a structural engineer in advance to determine that the
floor can safely handle the load and to secure written documentation of the structural engineer's
determination, a copy of which Lessee shall provide Lessor in advance of the specific use.
Section 1.6 Lease Term: -
The term of this Lease shall be ten (10) years, beginning on June 30, 2005 (the "Commencement
Date"), and ending on June 30, 2015, unless otherwise terminated under the provisions of
Subsections 1.6.1 through 1.6.3.
Subsection 1.6.1 Early Termination of Lease by Lessee:
Lessee may, in its sole discretion and without any recourse by or compensation to Lessor,
terminate the Lease with twelve (12)months notice to Lessor, so long as such twelve (12)-month
notice is on or after the three (3)-year anniversary of the Commencement Date with such Lease
termination effective on or after the four(4)-year anniversary of the Commencement Date.
Subsection 1.6.2 Early Termination of Lease by Lessor for.A "Non-Event Use":
Lessor may, in its sole discretion and without any recourse by or compensation to Lessee,
terminate the Lease with twelve (12)months notice to Lessee at any time, so long as such twelve
(12)-month notice is on or after the three (3)-year anniversary of the Commencement Date with
such Lease termination effective on or after the four(4)-year anniversary of the Commencement
Pavilion Building Lease 3
Date. However, this provision applies only if Lessor is terminating the Lease in order to use the
Pavilion Building for a "non-event use." For the purpose of this Subsection 1.6.2, "non-event
use" refers to any use other than one where the primary activity on the Premises is for events,
such as banquets, receptions, meetings, dances, fundraisers or the like. A use that includes
events as a secondary or accessory activity to the primary use of the Premises shall be considered
a"non-event use" for the purposes of this Subsection 1.6.2, including, but not limited to, a public
or private use that could include, as examples, a restaurant,book store, museum, library or public
market. The provisions of this Subsection 1.6.2 supersede Subsection 1.6.3.
Subsection 1.6.3 Early Termination of Lease by Lessor for Another"Event Use":
(a) Subject to the provisions of Subsections 1.6.3(b) and 1.6.3(c), Lessor may, in its sole
discretion, terminate the Lease with twelve (12) months notice to Lessee at any time so long as
such twelve (12)-month notice is on or after the three (3)-year anniversary of the Commencement
Date with such Lease termination effective on or after the four (4) year anniversary of the
Commencement Date. This provision applies only if Lessor is terminating the Lease in order to
use the Pavilion Building for another "event use." For the purpose of Subsection 1.6.3, "event
use" refers to any use where the primary activity on the Premises is for events, such as banquets,
receptions, meetings, dances, fundraisers or the like. A use that includes events as a secondary or
accessory activity to the primary use of the Premises shall not be considered an "event use" for
the purpose of Subsection 1.6.3, including, but not limited to, a public or private use that could
include, as examples, a restaurant,book store, museum, library or public market. The provisions
of Subsection 1.6.3 shall have no bearing on the provisions of Subsection 1.6.2 or apply to
Lessor's termination of the Lease for a"non-event use" as described therein.
(b) Lessor may not terminate the Lease for another "event use" as described in Subsection
1.6.3(a) so long as Lessee meets or exceeds the number of events noted below for each applicable
twelve (12)-month period beginning with the Commencement Date, hereafter referred to as the
"Performance Standard":
Months 1 thru 12 No performance measure
Months 13 thru 24 No performance measure
Months 25 thru 36 110 Events
Months 37 thru 48 120 Events
Months 49 thru 60 125 Events
Months 61 thru 72 130 Events
Months 73 thru 84 135 Events
Months 85 thru 96 140 Events
Pavilion Building Lease 4
•
Months 97 thru 108 145 Events
Months 109 thru 120 150 Events
For the purpose of this Subsection 1.6.3(b), an "event" shall refer to a revenue generating use of
the Pavilion Building for a: (i)block of time of at least one and a.half(1 '/a) hours each with forty
(40) or more attendees, including, for example, a banquet, reception, meeting, dance, fundraiser
or the like; or (ii) a breakfast or lunch meeting with forty (40) or more attendees. However, a
function with multiple elements on the same day with the same user, shall only count as one (1)
event, for example, a prom banquet followed by a dance. Lessee may include the applicable
City-sponsored events at the Pavilion Building provided for in Subsection 5.4.1, but not the
Piazza Events (and related use of the Pavilion Building restrooms) provided for in Subsection
5.4.2,in meeting the above Performance Standards.
If Lessee terminates the Lease under Subsection 1.6.1 or Lessor terminates the Lease under
Article 10,the provisions of this Subsection 1.6.3(b) shall be null and void.
(c) If Lessee fails to meet or exceed the Performance Standard in Subsection 1.6.3(b)for any one
(1)twelve(12)-month period listed therein beginning with the months 25 through 36,Lessor may
terminate the lease at any time thereafter with twelve (12) months notice to Lessee to use the
Pavilion Building for another "event use" as described in Subsection 1.6.3(a), with such Lease
termination effective on or after the four (4)-year anniversary of the Commencement Date.
However, Lessor or the new event use-tenant of the Premises shall pay Lessee the depreciated
value of Lessee's initial capital and up-front marketing costs as reflected in Exhibit"D,"Buy Out
Schedule, attached hereto and incorporated herein by this reference as if fully set forth(the`Buy-
Out Schedule").
The Buy-Out Schedule includes Lessee's estimated costs for the initial capital and up-front _.
marketing costs. However, the actual Buy-Out Schedule to be used for a Lease termination under
this Subsection 1.6.3 will be based on Lessee's actual incurred costs for the initial capital and up-
front marketing costs. Lessee may deviate plus or minus ten percent (10%) for actual costs in,
each of the following categories as further defined in the Buy Out Schedule:
Non-Moveable Capital Costs: $76,000
Moveable Capital Costs: $118,000
Up-Front Marketing Costs: $159,000
However, the maximum total amount of initial capital and up-front marketing costs to be
included in the Buy-Out Schedule may not exceed $355,000, even if Lessee's actual initial
capital and up-front marketing costs are in excess of$355,000.
The Buy-Out Schedule reflects a depreciation schedule where the up-front marketing costs
depreciate over six (6)years to zero in month seventy two(72)and the capital costs depreciate
over ten (10)years with a residual value of forty percent(40%)in year ten (10). The residual
value listed on the Buy-Out Schedule for each twelve(12)-month period represents the buy-out
,
Pavilion Building Lease 5
amount that will apply if the Lease is'terminated under this Subsection 1.6.3 effective at the end
of such twelve (12)-month period. If the Lease is terminated effective anytime during a twelve
(12)-month period, the annual depreciation will be prorated and the residual value adjusted
accordingly.
Within sixty(60)days of the end of the first twelve(12)months of the Lease,Lessee shall
submit: (i) an itemized statement of the actual capital costs and up-front marketing costs incurred
during the first twelve(12)months of the Lease; and(ii) an updated Buy-Out-Schedule, subject
to the definitions and limitations noted in this Subsection 1.6.3(c),hereafter referred to as the
"Updated Buy-Out Schedule."
I
Notwithstanding the Buy-Out Schedule, Lessee's actual incurred capital costs and up-front
marketing costs, the depreciation schedule described above or the Updated Buy-Out Schedule,
the maximum payment due to Lessee for early termination of the Lease for another event use as
described in Subsection 1.6.3(a) for the depreciated value of said items shall not, under any
circumstances, exceed the following amounts for a Lease termination effective during the
following months:
Months 1 thru 48 Not applicable
Months 49 thru 60 $220,000
Months 61 thru 72 $185,000
Months 73 thru 84 j $150,000
Months 85 thru 96 $115,000
Months 97 thru 108 $105,000
Months 109 thru 120 $95,000
At end of the ten (10)-year Lease Term: Not Applicable
For illustration purposes, if Lessor terminates the Lease with twelve (12)-months notice for
another "event use" as described in Subsection 1.6.3(a) on the three (3)-year anniversary of the
Commencement Date with such termination effective on the four (4)-year anniversary of the
Commencement Date, the payment due to Lessee for early termination of the Lease shall be the
residual value at the end of months 37 —48 on the Buy-Out Schedule (i.e., $215,298.74) or the
related amount on the Updated Buy-Out Schedule,but in no event greater than$220,000 as noted
above for a termination effective during months 49 thru 60.
If Lessor terminates the Lease for another "event use" as described in Subsection 1.6.3(a) and
Lessor or the new event-use tenant pays the depreciated value of Lessee's initial capital,costs and
up-front marketing costs as described above, the new tenant shall acquire all of Lessee's
ownership interests in all of the items included in the non-moveable and moveable capital costs
in the Updated Buy-Out Schedule.
Pavilion Building Lease 6
If Lessee terminates the Lease under Subsection 1.6.1 or. Article 10, the provisions of this
Subsection 1.6.3(c) shall be null and void.
Subsection 1.6.4 Space Reservations and Early Termination of Lease:
Lessee may reserve or rent space at the Pavilion Building to users for whatever period of time
into the future determined by Lessee to be most beneficial. However, Lessee shall not have any
space reserved or rented in excess of twelve (12) months into the future as of the third
anniversary of the Commencement Date, unless there is a provision which allows for Lessee to
terminate the space reservation or rental with twelve (12)months notice, and in no case later than
the end of the ten (10)-year Lease Term. Although Lessee may determine whether to compensate
a prospective user of the Pavilion Building in the event of a cancellation, Lessee shall be
responsible for any compensation to, claim of or recourse by any prospective Pavilion Building
user. Under no event shall Lessor be responsible for any compensation to, claim of or recourse
by any prospective user of the Premises for cancellation of a space reservation or rental,
including,but not limited to the termination or expiration of the Lease for any reason as provided
for in the Lease.
Subsection 1.6.5 Rights to Capital Investment at Lease Termination:
If any of the following events occur,Lessor shall acquire at no cost and without consideration all
of Lessee's ownership interests in all of the items included in the non-moveable capital costs in
the Updated Buy-Out Schedule: (i)if Lessee terminates the Lease under Subsection 1.6.1; (ii)if
Lessor terminates the Lease under Subsection 1.6.2; or(iii)if the ten (10)-year Lease Term
expires before the Lease is otherwise terminated.
At the end of the ten(10)-year Lease Term,Lessor or a new tenant of the Premises has the option
to secure all of Lessee's ownership interests in all of the items included in the moveable capital
costs in the Updated Buy-Out Schedule for the depreciated value of said items as noted therein or
a lower price negotiated with Lessee,but under no circumstances shall the price exceed$52,000.
Lessor shall notify Lessee in writing at least ninety(90)days prior to the end of the ten(10)-year
Lease Term if Lessor is interested in securing said items.
Section 1.7 Permitted Uses:
Lessee shall engage in the business of providing an event, banquet and meeting facility. See
Article 5 for additional information.
Section 1.8 Initial Security Deposit:
Within ten (10) days of the start of the Lease Commencement Date, as defined in Section 1.6,
Lessee shall provide to Lessor a security deposit in the amount of$10,000.00 which Lessor shall
place into an escrow account. Upon termination of the Lease, for any reason, this amount shall
be refunded to Lessee with interest, less the cost of the escrow account. In the event there is
damage to the Pavilion Building, not including normal wear and tear, and only for damage which
Pavilion Building Lease - 7
Lessee is responsible for under this Lease, funds from this escrow account shall be used to repair
the damage, with the balance left, if any, then being refunded to Lessee.
Section 1.9 Vehicle Parking Spaces Allocated to Lessee:
Lessee shall be allowed unlimited use of 4 parking spaces in the public parking lot to the north of
the Pavilion Building as established'and marked by signage by Lessor. If the Lessee or users of
the Pavilion Building use the City Center Parking Garage as identified in Exhibit "B," Project
Site Plan,the City's standard parking rates shall apply.
Section-1.10 Rent and Other Charges Payable by Lessee:
(a) Base Rent: Lessee shall pay Lessor monthly Base Rent during the Lease Term according to
the following schedule:
Lease Period (stated in Months) Monthly Base Rent Amount
First 3 Months $0.00
Next 3 Months $1,000.00
Next 12 Months $2,000.00
Thereafter $3,000.00
(b) Revenue Sharing: In addition to the monthly Base Rent above, Lessee shall pay monthly to
Lessor the following amounts. Such amounts shall not include any taxes paid by Lessee,
gratuities or charges for on-site labor.
Catering—Lessor shall receive 15% of the gross catering sales,including food and
beverage sales and charges for the following items if provided by Lessee: Audio Visual systems,
linens,flowers, tables,chairs,flatware,china,and the like
Room Rental—Lessor shall'receive 35%of gross room rental charges
(c)Audit:
Lessee will keep and maintain or will cause to be kept and maintained proper and accurate books,
records and accounts reflecting all items of revenue required to be reported to Lessor per this
Section 1.10. Lessor shall have the right, upon ten (10) days advance written notice to Lessee, to
examine such books, records and accounts at the local Renton office of Lessee and to make
copies or extracts thereof as Lessor shall desire. In conducting such examination, Lessor shall
exercise its best efforts not to interfere with the normal business operations of Lessee. Lessor
shall have the right to have an independent third-party auditor inspect and audit such books,
records and accounts of Lessee during normal business hours, the cost of which shall be paid by
Lessor. If the third-party auditor's report that Lessee has under reported its lease payments to
Pavilion Building Lease 8
Lessor, per the Revenue Sharing agreement in this Section 1.10, by more than 5%, then Lessee
shall reimburse Lessor for the reasonable cost of the third-party auditor's audit.
Section 1.11 Exhibits and Other Attachments Which are Part of the Lease:
Exhibit"A"-Legal Description
Exhibit"B" -Project Site Plan
Exhibit"C"-Floor Load Rating Specifications
Exhibit"D"-Buy-Out Schedule
Exhibit"E"-Maintenance Schedule
ARTICLE 2. LEASE TERM
Section 2.1 Lease of Property for Lease Term:
Lessor leases the Property to Lessee and Lessee leases the Property from Lessor for the Lease
Term. The Lease Term is for the period stated in Section 1.6 and shall begin and end on the
dates specified in Section 1.6, unless the beginning or end of the Lease Term is changed under
any provision of this Lease. The "Commencement Date" shall be the date specified in Section
1.6 for the beginning of the Lease Term unless advanced or delayed under any provision of this
Lease.
ARTICLE 3. RENT PAYMENTS AND RESERVES FOR OPERATING
EXPENSES
Section 3.1 Time and Manner of Payment:
On or before the twenty-eighth day of the second month of the Lease Term and each month
thereafter, Lessee shall pay Lessor the Base Rent described in Subsection 1.10(a),the amount for
the Revenue Sharing described in Subsection 1.10(b) for the prior calendar month and the
amount of the Leasehold Excise Tax described in Section 4.1. The rent shall be payable at
Lessor's address or at such other place as Lessor may designate in writing. Together with such
payment, Lessee shall provide a detailed financial report that substantiates the Revenue Sharing
payment for the prior calendar month, including but not limited to: (i) an itemized list of the
actual event dates, users and applicable catering sales and room rental charges as described in
Subsection 1.10(b) and (ii) a summary total for the number of qualified events that occurred to
date during each twelve(12)-month period for the Performance Standard described in Subsection
1.6.1.
Section 3.2 Advance Payments upon Termination:
Upon termination of this Lease under Article 7 (Damage or Destruction), Article 8
(Condemnation), or any other termination not resulting from Lessee's default, and after Lessee
Pavilion Building Lease - 9
has vacated the Property in the manner required by this Lease, Lessor shall refund or credit to
Lessee (or Lessee's successor) any advance rent or other advance payments made by Lessee to
Lessor.
ARTICLE 4. OTHER CHARGES PAYABLE BY LESSEE
Section 4.1 Taxes:
Lessee shall be responsible for the payment of the Leasehold Excise Tax (as further described
below),Business &Occupation Taxi and Sales Tax, as applicable.
So long as the Property is owned by Lessor and is exempt from general real estate taxes as a
municipal corporation in accordance with RCW 84.36.010, Lessee shall be obligated to pay the
applicable Leasehold Excise Tax (a.k.a. "Rent Excise Tax") on the Base Rent and Revenue
Sharing payment. Lessee shall calculate and pay the applicable Leasehold Excise Tax Leasehold
monthly to Lessor during the Lease Term along with the rents described in Section 3.1. Within
one hundred twenty (120) days after the end of each calendar year during the Lease Term or
within such longer period of time as may be reasonably necessary,Lessor shall furnish to Lessee
a statement of the Leasehold Excise Tax that Lessor was required to charge and collect from
Lessee for the preceding calendar year. If the required Leasehold Excise Tax charges for the
preceding calendar year exceed the monthly payments made by Lessee, then Lessee shall pay
Lessor the deficiency within thirty (30) days after receipt of the statement. If the Leasehold
Excise Tax payments made by Lessee exceed the required Leasehold Excise Tax charges for the
preceding calendar year, then, at Lessor's option, either Lessor shall pay Lessee the excess atthe
time Lessor furnishes the statement to Lessee or Lessee shall be entitled to offset the excess
against the next installment(s) of rent, provided, however, that at the end of the Lease Term
Lessor shall pay Lessee the excess at the time Lessor furnishes the statement to Lessee.
Section 4.2 Utilities:
Lessor shall be responsible for providing utilities to the Property, and represents and warrants to
Lessee that as of the Commencement Date water, sewer, gas, electricity, and telephone utilities
are available at the Property. Lessee shall pay for all water, sewer,gas,electricity,telephone, and
other utilities and services used by Lessee on the Property during the Lease Term. Under no
circumstances shall Lessee be responsible for any charges for water, sewer, gas, electricity, heat,
telephone, and other utilities and services, which are not under the control of Lessee and for the
use of providing services under this contract as a meeting,banquet and event facility.
Section 4.3 Insurance Policies
(a) Liability Insurance. Lessee shall maintain in full force throughout the duration of the Lease
Term a policy of commercial general liability insurance (sometimes known as broad form
comprehensive general liability insurance) insuring Lessee against liability for bodily injury,
property damage (including loss of use of property)and personal injury or death arising out of the
'operation, use or occupancy of the Property. Said liability insurance policy shall specifically list
"Liquor Liability Included" as a provision. Lessee shall name Lessor as an additional insured
under such policy. The initial amount of such insurance shall be One Million Dollars
Pavilion Building Lease 10
($1,000,000) per occurrence and Two Million Dollars ($2,000,000) aggregate and shall be .
subject to periodic increase based upon inflation, increased liability awards, recommendation of
Lessor's professional insurance advisors and other relevant factors. Lessee shall also maintain in
full force throughout the duration of the Lease Term a policy of automobile liability insurance
insuring Lessee against liability for bodily injury, property damage and personal injury or death
arising out of the operation or use of a vehicle by Lessee's employees, agents, contractors and
invitees in connection with the operation, use or occupancy of the Property. The initial amount
of such insurance shall be One Million Dollars ($1,000,000) per occurrence. The liability
insurance obtained by Lessee under this Section 4.3 shall (i)be primary and non-contributing; (ii)
contain cross-liability endorsements; and (iii) insure Lessor against Lessee's performance under
Section 5.6, if the matters giving rise to the indemnity under Section 5.6 result from the
negligence of Lessee. The amount and coverage of such insurance shall not limit Lessee's
liability nor relieve Lessee of any other obligation under this Lease. Lessor may also obtain
comprehensive public liability insurance in an amount and with coverage determined by Lessor
insuring Lessor against liability arising out of ownership, operation, use or occupancy of the
Property. The policy obtained by Lessor shall not be contributory and shall not provide primary
insurance.
If Lessee requires any agent, contractor, user or invitee to secure or maintain liability insurance
related to alterations to or maintenance, operation, use or occupancy of the Property,Lessee shall
require such liability insurance to include Lessor as an additional insured on such policies.
Notwithstanding the above,Lessor accepts liability for the use of the Pavilion Building restrooms
for Piazza Events provided for in Subsection 5.4.2.
(b) Property Insurance. During the Lease Term, Lessor shall maintain policies of insurance to
be paid for by Lessor covering loss of or damage to the Property in the full amount of its
replacement value. Such policy shall contain an inflation guard Endorsement and shall provide
protection against all perils included within the classification of fire, extended coverage,
vandalism, malicious mischief, special extended perils (all risk), sprinkler leakage and any other
perils which Lessor deems reasonably necessary. Lessor shall not obtain insurance for Lessee's
fixtures or equipment or building improvements installed by Lessee on the Property. Lessee shall
maintain policies of insurance for Lessee's fixtures or equipment or building improvements
installed by Lessee on the Property.
(c) General Insurance Provisions.
(i) Any insurance which Lessee is required to maintain under this Lease shall include a provision
which requires the insurance carrier to give Lessor not less than forty five (45) days written
notice prior to any cancellation or modification of such coverage.
(ii) If Lessee fails to deliver any policy, certificate or renewal to Lessor required under this Lease
within the prescribed time period or if any such policy is canceled or modified during the Lease
Term without Lessor's consent, Lessor may obtain such insurance, in which case Lessee shall
reimburse Lessor for the cost of such insurance within fifteen (15) days after receipt of a
statement that indicates the cost of such insurance.
•
Pavilion Building Lease 11
(iii)Lessee shall maintain all insurance required under this Lease with companies rated A-XV or
better in Best's Insurance Guide, and which are authorized to transact business in the State of
Washington. If at any time during the Lease Term, Lessee is unable to maintain the insurance
required under the Lease, Lessee shall nevertheless maintain insurance coverage which is
customary and commercially reasonable in the insurance industry for Lessee's type of business,
as that coverage may change from time to time. Lessor makes no representation as to the
. adequacy of such insurance to protect Lessor's or Lessee's interest. Therefore, Lessee shall
obtain any such additional property or liability insurance which Lessee deems necessary to
protect Lessor and Lessee.
(iv) Lessee and Lessor hereby release and discharge each other from all claims, losses and
liabilities arising from or caused by any hazard covered by property insurance on or in connection
with the premises or said building. This release shall apply only to the extent that such claim,
loss or liability is covered by insurance.
Section 4.4 Maintenance of Facility:
Lessee shall reimburse Lessor within thirty (30) days after receipt of a statement for the cost of:
(i) Lessor performing any maintenance to the Premises for which Lessee is responsible and
which Lessee approves in writing and (ii) Lessor performing any emergency maintenance to
safeguard and preserve the integrity of the Premises if Lessor is unable to reach Lessee in an
emergency for Lessee`to perform the maintenance.
Section 4.5 Common Exterior Areas; Use,Maintenance and Costs:
For the purpose of this Section 4.5, Common Exterior Areas are defined as the Piazza Park on
the south side of the Pavilion Building and the public parking lot, Renton Transit Center and City
Center Parking Garage on the north side of the Pavilion Building as identified in Exhibit "B,"
Project Site Plan. If Lessor encounters damage (beyond normal wear and tear) or extraordinary
trash in the Common Exterior Areas that are attributed to Lessee's use of the Premises, Lessor
shall notify Lessee to allow Lessee to perform the required maintenance or custodial services. If
Lessee elects not to perform the required maintenance or custodial services, Lessee shall
reimburse Lessor within thirty (30) days after receipt of a statement for the cost of performing
such work so long as the damage or extraordinary trash is related to the Lessee's use of the
Premises.
Section 4.6 Late Charges:
Lessee's failure to pay rent promptly may cause Lessor to incur unanticipated costs. The exact
amount of such costs are impractical or difficult to ascertain. Such costs may include,but are not
limited to, processing and accounting charges and late charges which may be imposed on Lessor
by any ground lease, mortgage or other.encumbrance on the Property. Consequently, if Lessor
does not receive any Rent payment within ten (10) days after it becomes due, Lessee shall pay
Lessor a late charge equal to five percent (5%) of the overdue amount for each month that it is
overdue. The parties agree that such late charge represents a fair and reasonable estimate of the
costs Lessor will incur by reason of such late payment.
Pavilion Building Lease 12
Section 4.7 Interest on Past Due Obligations:
Any amount owed by Lessee to Lessor which is not paid when due shall bear interest at the rate
of twelve percent(12%)per annum from the due date of such amount, however, interest shall not
be payable on late charges to be paid by Lessee under this Lease. The payment of interest on
such amounts shall not excuse or cure any default by Lessee under this Lease. If the interest rate
specified in this Lease is higher than the rate then permitted by law, the interest rate shall be
decreased to the maximum legal interest rate then permitted by law.
ARTICLE 5. USE OF PROPERTY
Section 5.1 Permitted Uses:
Lessee shall have exclusive control and access to the Pavilion Building, except as defined
elsewhere in this Lease. Lessee may use the Property only for the Permitted Uses set forth in
Section 1.7 and subject to the floor load restrictions included in Section 1.5.
Lessee shall not allow smoking inside the building, and shall provide adequate ashtrays in the
patio areas outside to accommodate any smoking. Any animal show on the Premises must be
approved by Lessor in writing prior to the event. Incidental animal activities such as magic
shows and service animals such as guide dogs for the blind shall not require Lessor approval.
Lessee shall not allow the use of rice, confetti, birdseeds, flower petals and the like outside the
Pavilion Building. Bubbles shall be permitted outside. Lessee shall not allow any obscene use
of the Premises.
The maximum occupancy of the building shall be 655 people.
Section 5.2 Manner of Use:
Lessee shall professionally market, maintain and operate the Premises as a quality meeting,
banquet and event space.
Lessee shall not cause or permit the Property to be used in any way which constitutes a violation
of any law, ordinance, or governmental regulation or order. Lessee shall obtain and pay for all
permits, other than a Certificate of Occupancy, required for Lessee's occupancy of the Property
and shall promptly take all actions necessary to comply with all applicable statutes, ordinances,
rules,regulations, orders and requirements regulating the use by Lessee of the Property,including
the Occupational Safety and Health Administration.
Notwithstanding the above, Lessee or Lessee's users shall secure any required liquor license,
banquet license or food handling permits, as applicable,for use of the Premises.
Lessee shall not obstruct, cover or block the Pavilion Building windows, including but not
limited to window coverings and moveable partitions, except as necessary during events and
meetings. Any such window coverings and moveable partitions will be immediately opened or
removed as applicable on a daily basis after any events or meetings.
Pavilion Building Lease 13
Section 5.3 Use of Piazza Park:
Lessor shall provide Lessee with an annual schedule of City-sponsored events for the Piazza
Park. Although Lessor reserves the right to schedule City-sponsored events at the Piazza Park at
any time, Lessor will attempt to schedule additional City-sponsored events on dates where there
are no conflicting uses scheduled at the Pavilion Building if possible.
Lessor acknowledges that users and invitees for events at the Pavilion Building may occupy a
portion of the Piazza Park for incidental use without the prior, written consent of the Renton Park
Board. For the purpose of this provision, incidental use shall mean the ability to use or
congregate in a portion of the Piazza Park so long as: (i) City of Renton's Park Rules and
Regulations are maintained, (ii) no food or beverages are served in the Piazza Park and (iii) no
objects that impede or restrict public access or full use of the Piazza Park by other persons are
placed in the Piazza Park, including, but not limited to, stanchions, barricades, stands, chairs,
tables, tents, fixtures or the like. In order for users or invitees of the Pavilion Building to occupy
any portion of the Piazza Park for any use other than specifically provided for above, Lessee or
user of the Pavilion Building must pay any applicable fee and secure the Renton Park Board's
prior, written approval.
Lessee shall provide users of the Premises with a copy of City of Renton's Park Rules and
Regulations. Lessee shall make users and invitees of the Premises aware of the City of Renton's
restriction against the use of alcohol in the Piazza Park, and of the restrictions related to use of
the Piazza Park as described above.
Section 5.4 City Use of Facility:
Subsection 5.4.1 City-Sponsored Events:
(a) Lessor shall have the right to schedule up to a maximum of 12 City-Sponsored Events per
year at the Pavilion Building. For the purpose of this Subsection 5.4.1, City-Sponsored Events
shall refer to any event sponsored or co-sponsored by the City as submitted to Lessee by the
Office of the Mayor or the Mayor's designee. Lessor shall be responsible for any liability or
damage to persons or property that occurs in any way as'a result of these City-Sponsored Events.
These events shall be allowed on a.space available basis by Lessee, and subject to the restrictions
of Subsection 5.4.1(d).
(b) Lessee shall only be responsible for allowing access to the Pavilion Building, and providing
custodial services before, during and after the event.
(c)The fee to the City for these City- Sponsored Events shall be as follows:
Base Fee: $250
Hourly Attendance Fee: $35
Excessive Cleanup Surcharge: Reimbursement of Lessee's actual costs
Pavilion Building Lease 14
These fees and charges shall not include any services other than access to an empty, clean S •
Pavilion Building with a comfortable temperature and well-stocked restrooms. Any additional
services such as catering and the like, shall be billed at Lessee's normal rates, and the exclusivity
of Lessee's right to provide such services shall remain in affect during these City Sponsored
Events. The room rental revenue (but not the catering revenue) from these City Sponsored
events to Lessor shall not be subject to the Revenue Sharing provisions of Subsection 1.10(b).
(d) Scheduling of these City Sponsored Events shall not fall within the following times and dates
unless otherwise approved by Lessee in writing:
Friday Evenings after 3:00pm
Saturdays
Sundays
Holidays
However, the exclusions in this Subsection 5.4.1(d) shall not apply during the annual Renton
River Days event and for the annual Holiday Tree Lighting festivities.
Subsection 5.4.2 Piazza Events:
Lessor may schedule up to a maximum of 36 City-approved events in the Piazza Park such as the
Renton Farmers' Market, the Cinema on the Piazza summer movies, festivals and the like where
Lessee shall provide access to the restrooms of the Pavilion Building (but not the entire
building). Lessor shall provide Lessee with at least sixty (60) days advance notice for such
events. Lessee agrees to work with other potential users of the Pavilion Building for the dates of
such Piazza events to promote shared use of the Pavilion Building restrooms, if possible.
However, if Lessee has another use scheduled for the Pavilion Building where shared use of the
restrooms is not possible for one (1) or more of the above Piazza events, Lessee shall provide
Lessor with at least thirty (30) days advanced notice, in which case Lessee shall not provide
access to the Pavilion Building restrooms and Lessor or the Piazza event sponsor shall secure
commercially available portable toilets at its own expense, if desired. If there is no other event
scheduled or another,event scheduled where the Pavilion Building restrooms may be shared,
Lessee shall make the restrooms at the Pavilion Building available for $50.00 for each eight (8)
hour period per event. Said fee shall be paid by Lessor or the Piazza event sponsor within 30
days of receipt of invoice from Lessee. Lessor shall be responsible for opening, monitoring,
cleaning, restocking and locking the Pavilion Building restrooms for each such event. Lessor
shall be responsible for any liability or damage to persons or property that occurs in any way as a
result of the use of the Pavilion Building restrooms for such Piazza events. The$50.00 payments
for use of the Pavilion Building restrooms described in this Subsection 5.4.2 shall not be subject
to the Revenue Sharing provisions of Subsection 1.10(b).
If another event is scheduled during one (1) of the above Piazza events, Lessee shall inform the
Pavilion Building user for such date of the Piazza event so that the user is aware in advance of
potential impacts from the Piazza event on the user's event or meeting on the Premises.
Pavilion Building Lease 15
Section 5.5 Signs:
Lessee shall not place any interior or exterior signs on the Property without Lessor's prior written
consent.
Section 5.6 Indemnity:
Subsection 5.6.1 Lessee's Indemnification of Lessor:
Lessee, Spirit of Washington, Inc., shall indemnify, defend and hold Lessor harmless from and
against any and all costs, claims, losses or liability, or any portion thereof, arising from: (a)
Lessee's use of the Property; (b) the conduct of Lessee's business or anything else done or
permitted by Lessee to be done in or about the Property, including any contamination of the
Property or any other property resulting from the presence or use of Hazardous Material caused
or permitted by Lessee; (c) any breach of default in the performance of Lessee's obligations
under this Lease; (d) any misrepresentation or breach of warranty by Lessee under this Lease; or
(e) other acts or omissions of Lessee. Lessee shall defend Lessor against any such cost, claim,
loss or liability at Lessee's expense with counsel reasonably acceptable to Lessor or, at Lessor's
election, Lessee shall reimburse Lessor for any legal fees or costs incurred by Lessor in
connection with any such claim. ' As a material part of the consideration to Lessor, Lessee
assumes all risk of damage to property or injury to persons in the Property arising from any
cause, and Lessee hereby waives all claims in respect thereof against Lessor,except for any claim
arising out of Lessor's sole negligence. As used in this Section 5.6, the term "Lessee," for
purposes of triggering indemnification, shall include Lessee's officers, employees, agents,
contractors, volunteers and invitees;if applicable.
This indemnification provision shall not be applicable to any sums payable under RCW Title 51
and does not waive the protections)of Title 51 RCW. This provision has been freely negotiated
between Lessee and Lessor.
The provisions of this Subsection 5.6.1 shall survive the termination or expiration of this Lease.
Subsection 5.6.2 Lessor's Indemnification of Lessee:
This Subsection 5.6.2 shall apply'only to Lessor's liability and responsibility for (i) the City-
Sponsored Events provided for in Subsection 5.4.1; and (ii) the use of the Pavilion Building
restrooms for Piazza events provided for in Subsection 5.4.2. Lessor shall provide no other
indemnification for Lessee.
Subject to the above limitations,Lessor, City of Renton, shall indemnify, defend and hold Lessee
harmless from and against any and all costs, claims, losses or liability, or any portion thereof,
arising from: (a) Lessor's use of the Property; (b) the conduct of Lessor's business or anything
else done or permitted by Lessor to be done in or about the Property, including any
contamination of the Property or any other property resulting from the presence or use of
Hazardous Material caused or permitted by Lessor; (c) any breach of default in the performance
of Lessor's obligations under this Lease; (d) any misrepresentation or breach of warranty by
Lessor under this Lease; or (e) other acts or omissions of Lessor. Lessor shall defend Lessee
Pavilion Building Lease - 16
against any such cost, claim, loss or liability at Lessor's expense with counsel reasonably
acceptable to Lessee or, at Lessee's election, Lessor shall reimburse Lessee for any legal fees or
costs incurred by Lessee in connection with any such claim. As a material part of the
consideration to Lessee, Lessor assumes all risk of damage to property or injury to persons in the
Property arising from any cause, and Lessor hereby waives all claims in respect thereof against
Lessee, except for any claim arising out of Lessee's sole negligence. As used in this Section 5.6,
the term "Lessor," for purposes of triggering indemnification, shall include Lessor's officers,
employees, agents, contractors,volunteers and invitees,if applicable.
This indemnification provision shall not be applicable to any sums payable under RCW Title 51
and does not waive the protections of Title 51 RCW. This provision has been freely negotiated
between Lessee and Lessor.
The provisions of this Subsection 5.6.2 shall survive the termination or expiration of this Lease.
Section 5.7 Lessor's Access:
Lessor may access the main electrical room on the northeast side of the Pavilion Building at any
time and without notice for the purpose of using or maintaining the electrical service and exterior
lighting controls for the Piazza Park. Lessor may also access the restrooms at the Pavilion
Building for Piazza events as provided for in Subsection 5.4.2.
Lessor or its agents may enter the Property at all reasonable times to show the Property to
potential buyers, investors, lessees or other parties. Lessor shall give Lessee reasonable prior
notice of such entry, except in the case of emergency. Lessor may place customary "For Lease"
• signs on the Property within 365 days of the Lease termination date. Lessee may take down the
"For Lease"signs during events,but shall replace them immediately afterwards.
Section 5.8 Quiet Possession:
If Lessee pays the Rent and complies with all other terms of this Lease, Lessee may occupy and
enjoy the Property for the full Lease Term, subject to the provisions of this Lease.
Notwithstanding the above, Lessee acknowledges that the Premises are located adjacent to the
Piazza Park and the Renton Transit Center and that, as such, the use of the Premises may be
impacted by the day-to-day activities in the adjacent spaces or City-sponsored or endorsed
activities in the Piazza Park, including but not limited to the Piazza events described in
Subsection 5.4.2.
Section 5.9 Hazardous Material:
Lessor represents and warrants to Lessee that, to the best of Lessor's knowledge, there is no
"Hazardous Material" (as defined below) on, in, or under the Premises as of the Commencement
Date except as otherwise disclosed to Lessee in writing before the execution of this Lease. If
there is any Hazardous Material on, in, or under the Premises as of the Commencement Date,
which has been or thereafter becomes unlawfully released through no fault of Lessee,then Lessor
shall indemnify, defend and hold Lessee harmless from any and all claims,judgments, damages,
penalties, fines, costs, liabilities or losses including without limitation sums paid in settlement of
Pavilion Building Lease 17
claims, attorneys' fees, consultant fees and expert fees, incurred or suffered by Lessee either
during or after the Lease Term as the result of such contamination.
Lessee shall not cause or permit any Hazardous Material to be brought upon, kept, or used in or
about, or disposed of on the Premises by Lessee, its officers, agents, employees, contractors or
invitees, except in strict compliance with all applicable federal, state and local laws, regulations,
codes and ordinances. If Lessee breaches the obligations stated in the preceding sentence, then
Lessee shall indemnify, defend and hold Lessor harmless from any and all claims, judgments,
damages, penalties, fines, costs, liabilities or losses including, without limitation, diminution in
the value of the Premises, damages for the loss or restriction on use of rentable or usable space or
of any amenity of the Premises, or elsewhere, damages arising from any adverse impact on
marketing of space at the Premises, and sums paid in settlement of claims, attorneys' fees,
consultant fees and expert fees incurred or suffered by Lessor either during or after the Lease
Term. These indemnifications by Lessor and Lessee include, without limitation,costs incurred in
connection with any investigation of site conditions or any clean-up, remedial, removal or
restoration work, whether or not required by any federal, state or local governmental agency or
political subdivision, because of Hazardous Material present in the Premises, or in soil or ground
water on or under the Premises. Lessee shall immediately notify Lessor of any inquiry,
investigation or notice that Lessee may receive from any third party regarding the actual or
suspected presence of Hazardous Material on the Premises.
Without limiting the foregoing, if the presence of any Hazardous Material brought upon, kept or
used in or about the Premises by Lessee, its officers, agents, employees, contractors or invitees,
results in any unlawful release of Hazardous Material on the Premises or any other property,
Lessee shall promptly take all actions, at its sole expense, as are necessary to return the Premises
or any other property, to the condition existing prior to the release of any such Hazardous
Material; provided that Lessor's approval of such actions shall first be obtained, which approval
may be withheld at Lessor's sole discretion.
As used herein, the term "Hazardous Material" means any hazardous, dangerous, toxic or
harmful substance, material or waste including biomedical waste which is or becomes regulated
by any local governmental authority, the State of Washington or the United States Government
due to its potential harm to the health, safety or welfare of humans or the environment.
ARTICLE 6. CONDITION OF PROPERTY; MAINTENANCE, REPAIRS AND
ALTERATIONS
Section 6.1 Existing Conditions:
Lessee accepts the Property in its condition as of the execution of the Lease, subject to all
recorded matters, laws, ordinances, and governmental regulations and orders. Lessee
acknowledges that neither Lessor nor any agent of Lessor has made any representation as to the
condition of the Property nor the suitability of the Property for Lessee's intended use. Lessee
represents and warrants that Lessee has made its own inspection of and inquiry regarding the
condition of the Property and is not relying on any representations of Lessor or any Broker with
respect thereto. If Lessor or Lessor's Broker has provided a Property Information Sheet or other
Pavilion Building Lease 18
Disclosure Statement regarding the Property, a copy is attached as an exhibit to the Lease and
initialed by both parties.
Section 6.2 Exemption of Lessor from Liability:
Lessor shall not be liable for any damage or death or injury to the person, business (or in any loss
of income there from), goods, wares, merchandise or other property of Lessee, Lessee's officers,
agents, employees, invitees, customers or any other person in or about the Property, whether such
damages or injury is caused by or results from: (a) fire, steam, electricity, water, gas, snow, rain,
or volcanic activity; (b) the breakage, leakage, obstruction or other defects of pipes, sprinklers,
wires, appliances, plumbing, air condition or lighting fixtures or any other cause; or (c)
conditions arising in or about the Property or upon other portions of the Project, or from other
sources or places. Lessor shall not be liable for any such damage or injury even though the cause
of or the means of repairing such damage, death or injury are not accessible to Lessee. The
provisions of this Section 6.2 shall not, however, exempt Lessor from liability for Lessor's
negligence or misconduct.
Section 6.3 Maintenance and Repairs:
•
Lessee shall have total responsibility for maintenance as described in Exhibit "E," Maintenance
Schedule, routine repairs and custodial services for the Project. A specific description of the
maintenance and custodial requirements is included as Exhibit "E," Maintenance Schedule,
attached hereto and incorporated herein by this reference as fully set forth. Lessee shall maintain
records on the Premises that document Lessee's performance of preventative maintenance,
inspections and service to the HVAC and other building systems included in Exhibit "E,"
Maintenance Schedule, Section II (Mechanical). Such records shall be available for inspection
by Lessor. Lessor will conduct periodic inspections of the Premises and the above records with
ten (10) days notice to assure compliance with the maintenance and custodial requirements.
Lessor reserves the right to perform emergency maintenance services to safeguard and preserve _.
the integrity of the Premises and to perform maintenance, repairs or custodial services if Lessee
fails to perform them within thirty (30) days of notice. Lessor will bill Lessee for emergency or
other services provided by Lessor and Lessee shall make payment along with the rent described
in Section 1.10.
Lessee is responsible for any processes, procedures, or construction activities that require
environmental review, permits, or similar approvals. Qualified individuals shall perform all
maintenance, design or construction work on the Premises.
Lessor shall assume responsibility for all damage, maintenance, and repair to the exterior of the
Pavilion Building, whether for vandalism or other, unless caused by Lessee's use of the
Premises.
Lessor shall provide Lessee at no charge with initial instruction regarding the operation and
maintenance of HVAC and other mechanical systems located in the Pavilion Building and the
use of the Maintenance Schedule included in Exhibit"E."
Subject to the provisions of Article 7, if Lessee performs the required preventative maintenance,
inspections and service included in Exhibit "E,"Maintenance Schedule, Section II(Mechanical),
Pavilion Building Lease 19
Lessor shall accept responsibility for failures to the following equipment, systems or components
on the Premises: structural components, HVAC, plumbing, electrical distribution and electronic
control systems. However, this provision shall not apply to items that may need repair or
replacement by Lessee due to normal wear and tear during the Lease Term including, but not
limited to, door openers and closers; roll up door rollers, toilet flush values, restroom fans, light
bulbs and other consumable items.
Section 6.4 Alterations,Additions, and Improvements:
(a) Lessee shall not make any alterations, additions, or improvements to the Property or install
permanent window screenings or interior or exterior signage without Lessor's prior written
consent. Lessee shall pay for any alterations, additions or improvements approved by Lessor.
The term "Alterations" shall not include the installation of carpet, shelves, movable partitions,
Lessee's equipment, and trade fixtures which may be performed without damaging existing
improvements or the structural integrity of the Property, and Lessor's consent shall not be
required for Lessee's installation of those items. However, Lessee agrees to coordinate any
carpet installation in advance with Lessor to insure that the carpet is installed in a manner that
allows appropriate service access to.all HVAC service areas in the plenum. Lessor may require
Lessee to provide demolition and/or.lien and completion bonds.in form and amount satisfactory
to Lessor. Lessee shall promptly remove any alterations, additions, or improvements constructed
in violation of this Section 6.4 upon Lessor's written request. All alterations, additions, and
improvements shall be done in a good and workmanlike manner, in conformity with all
applicable laws and regulations, and by a contractor approved by Lessor. Upon completion of
any such work, Lessee shall provide Lessor with "as built" plans, copies of all construction
contracts, and proof of payment for all labor and materials. Lessee shall not be required to
remove or pay the cost of removal of any Alterations upon the termination or expiration of the
Lease for any reason. All Alternations shall become the property of Lessor upon termination or
expiration of the Lease.
(b)Lessee shall pay when due all claims for labor and material furnished to the Property. Lessee
shall give Lessor at least twenty(201days prior written notice of the commencement of any work
on the Property, regardless of whether Lessor's consent to such work is required. Lessor may
elect to record and post notices of non-responsibility on the Property. Lessee shall reimburse
Lessor for any legal fees or costs incurred by Lessor in connection with defending itself against
any claims for labor or material furnished to the Property.
Section 6.5 Condition Upon Termination of Lease:
Upon the termination of the Lease, Lessee shall surrender the Property to Lessor, broom clean
and in the same condition as received except for ordinary wear and tear which Lessee was not
otherwise obligated to remedy under,any provision of this Lease. However, Lessee shall not be
obligated to repair any damage which Lessor is required to repair under Article 7 (Damage or
Destruction). All alterations, additions and improvements shall become Lessor's property and
shall be surrendered to Lessor upon the expiration or early termination of the Lease, except that
Lessee may remove any of Lessee's machinery or equipment which can be removed without
material damage to the Property. Lessee shall repair, at Lessee's_expense, any damage to the
Property caused by the removal of any such machinery, specialty cabinets installed by Lessee,
Pavilion Building Lease 20
computer, telephone or other communication or electronic equipment, or other equipment. In no •
event, however, shall Lessee remove any of the following materials or equipment (which shall be
deemed Lessor's property) without Lessor's prior written consent: any power wiring or power
panels; lighting or lighting fixtures, wall coverings; drapes, blinds or other window coverings;
carpets or other floor coverings; heaters, air conditioners or any other heating or air conditioning
equipment; fencing or security gates or security systems; or other similar building operating
equipment and decorations.
Within thirty (30) days after the expiration or early termination of this Lease, Lessee shall
remove from the Premises, at its sole expense, all equipment, furnishings, and other personal
property.owned.and.placed.in oron the Premises by the Lessee unless otherwise provided for in
the Lease. If Lessee fails to removed such equipment, furnishings, and other personal property
within the time allowed,Lessor may, but need not, remove said personal property and hold it for
the owners thereof, or place the same in storage, all at the expense and risk of the owners thereof,
and Lessee shall reimburse Lessor for any expenses incurred by Lessor in connection with such
removal and storage. Lessor shall have the right to sell such stored property, without notice to
Lessee, after it has been stored for a period of thirty(30) days or more, the proceeds of such sale
to be applied first to the cost of sale, second to payment of any charges for storage, and third to
the payment of any other amounts which may then be due from Lessee to Lessor, and the
balance,if any, shall be paid to Lessee.
ARTICLE 7. DAMAGE OR DESTRUCTION
Section 7.1 Partial Damage to Property:
(a) Lessee shall notify Lessor in writing immediately upon the occurrence of any damage to the
Property. If the Property is only partially damaged, [i.e., less than fifty percent (50%) of the
Property is unleaseable as a result of such damage or less than fifty percent (50%) of Lessee's
operations are materially impaired], and if the proceeds received by Lessor from the insurance
policies described in Subsection 4.3(b) are sufficient to pay for the necessary repairs, this Lease
shall remain in effect and Lessor shall repair the damage as soon as reasonably possible. Lessor
may elect (but is not required) to repair any damage to Lessee's fixtures, equipment, or
improvements. Lessee shall pay Lessor, if the damage was due to an act or omission of Lessee,
or Lessee's employees, agents, contractors or invitees, the "deductible amount," if any, under
Lessor's insurance policies.
(b)If the insurance proceeds received by Lessor are not sufficient to pay the entire cost of repair,
or if the cause of the damage is not covered by the insurance policies which Lessor maintains
under Section 4.3,Lessor may elect either to (i)repair the damage as soon as reasonably possible,
in which case this Lease shall remain in full force and effect, or(ii)terminate this Lease as of the
date the damage occurred. Lessor shall notify Lessee within thirty (30) days after receipt of
notice of the occurrence of the damage whether Lessor elects to repair the damage or terminate
the Lease. Lessee shall pay Lessor, if the damage was due to an act or omission of Lessee, or
Lessee's employees, agents, contractors or invitees, the "deductible amount," if any, under
Lessor's insurance policies. If Lessor elects to terminate the Lease,Lessee may elect to continue
this Lease in full force and effect, in which case Lessee shall repair any damage to the Property
and any building in which the Property is located. Lessee shall pay the cost of such repairs,
Pavilion Building Lease - • 21
except that upon satisfactory completion of such repairs, Lessor shall deliver to Lessee any
insurance proceeds received by Lessor for the damage repaired by Lessee. Lessee shall give
Lessor written notice of such election within ten (10) days after receiving Lessor's termination
notice.
(c) If the damage to the Property occurs during the last six (6) months of the Lease Term and
such damage will require more than thirty (30) days to repair, either Lessor or Lessee may elect
to terminate this Lease as of the date the damage occurred, regardless of the sufficiency of any
insurance proceeds. The party electing to terminate this Lease shall give written notification to
the other party of such election within thirty (30) days after Lessee's notice to Lessor of the
occurrence of the damage.
Section 7.2 Substantial or Total Destruction:
If the Property is substantially or totally destroyed by any cause whatsoever (i.e., the damage to
the Property is greater than partial damage as described in Section 7.1, and regardless of whether
Lessor receives any insurance proceeds, this Lease shall terminate as of the date the destruction
occurred. Notwithstanding the preceding sentence, if the Property can be rebuilt within six (6)
months after the date of destruction, Lessor may elect to rebuild the Property at Lessor's own
expense, in which case this Lease shall remain in full force and effect. Lessor shall notify Lessee
of such election within thirty (30) days after Lessee's notice of the occurrence of total or
substantial destruction. If Lessor so elect, Lessor shall rebuild the Property at Lessor's sole
expense, except that if the destruction was caused by an act or omission of Lessee.
Section 7.3 Temporary Reduction of Rent:
If the Property is destroyed or damaged and Lessor or Lessee repairs or restores the Property
pursuant to the provisions of this Aticle 7, any rent payable during the period of such damage
repair and/or restoration shall be reduced according to the degree,if any,to which Lessee's use of
the Property is impaired. Except for such possible reduction in Base Rent, Lessee shall not be
entitled to any compensation,reduction, or reimbursement from Lessor as a result of any damage,
destruction,repair,or restoration of or to the Property.
Section 7.4 Destruction Waiver:
Lessee waives the protection of any statute, code or judicial decision which grants a lessee the
right to terminate a lease in the event of the substantial or total destruction of the leased Property.
Lessee agrees that the provision of Section 7.2 above shall govern the rights and obligations of
Lessor and Lessee in the event of any substantial or total destruction to the Property.
ARTICLE 8. CONDEMNATION
If all or any portion of the Property is taken under the power of eminent domain or sold under the
threat of that power(all of which are called"Condemnation"),this Lease shall terminate as to the
part taken or sold on the date the condemning authority takes title or possession, whichever
occurs first. If more than twenty percent (20%) of the floor area of the building in which the
Property is located, or which is located on the Property, is taken, either Lessor or Lessee may
Pavilion Building Lease 22
terminate this Lease as of the date the condemning authority takes title or possession, by '
delivering written notice to the other within ten (10) days after receipt of written notice of such
taking (or in the absence of such notice, within ten 00)days after the condemning authority takes
title or possession). If neither Lessor nor Lessee terminates this Lease, this Lease shall remain in
effect as to the portion of the Property not taken, except that the Base Rent shall be reduced in
proportion to the reduction in the floor area of the Property. Any Condemnation Award or
payment shall be distributed in the following order: (a) first, to any mortgagee or beneficiary
under a deed of trust encumbering the Property, the amount of its interest in the Property; (b)
second, to Lessee, only the amount of any award specifically designated for loss of or damage to
Lessee's trade fixtures or removable personal property; and (c) third, to Lessor, the remainder of
such award,..whether as compensation for reduction in the value of the leasehold, the taking of
the fee, or otherwise. If this Lease is not terminated, Lessor shall repair any damage to the
Property caused by the Condemnation, except that Lessor shall not be obligated to repair any
damage for which Lessee has been reimbursed by the condemning authority If the severance
damages received by Lessor are not sufficient to pay for such repair, Lessor shall have the right
to either terminate this Lease or make such repair at Lessor's expense.
ARTICLE 9. ASSIGNMENT AND SUBLETTING
Section 9.1 Lessor's Consent Required:
No portion of the Property or of Lessee's interest in this Lease may be acquired by any other
person or entity, whether by sale, assignment, mortgage, sublease, transfer, operation of law, or
act of Lessee (hereafter collectively referred to as a "Transfer") without Lessor's prior written
consent. Lessor has the right to grant or withhold its consent as provided in Section 9.3 below.
Any attempted Transfer without Lessor's prior written consent shall be void and shall constitute
a non-curable breach of this Lease. If Lessee is a partnership or limited liability company, any
cumulative Transfer of more than twenty percent (20%) of the entity's interests shall require ..
Lessor's consent. If Lessee is a corporation, any change in the ownership of a controlling interest
of the voting stock of the corporation, cumulatively over the life of the Lease, shall require
Lessor's consent.
Section 9.2 No Release of Lessee:
No Transfer shall release Lessee or change Lessee's primary liability topay the rent and to
perform all other obligations of Lessee under this Lease. Lessor's acceptance of rent from any
other person is not a waiver of any provision of this Article 9. Consent to one Transfer is not
consent to any subsequent Transfer. If Lessee's transferee defaults under this Lease,Lessor may
proceed directly against Lessee without pursuing'remedies against the transferee. Lessor may
consent to subsequent assignments or modifications of this Lease by Lessee's transferee, without
notifying Lessee or obtaining its consent. Such action shall not relieve Lessee's liability under
this Lease.
Section 9.3 Lessor's Consent:
Lessee's request for consent to any Transfer described in Section 9.1 shall set forth in writing the
details of the proposed Transfer, including the name, business and financial condition of the
Pavilion Building Lease 23
prospective transferee, financial details of the proposed Transfer (e.g., the term of and the rent
and security deposit payable under any proposed assignment or sublease), and any other
information Lessor deems relevant. Lessor shall have the right to withhold consent, if
reasonable, or to grant consent, based on the following factors: (i) the business of the proposed
assignee or sublessee and the proposed use of the Property; (ii) the net worth and financial
reputation of the proposed assignee or sublessee; (iii) Lessee's compliance with all of its
obligations under the Lease; and(iv)such other factors as Lessor may reasonably deem relevant.
ARTICLE 10. DEFAULT OR FAILURE OF CONSIDERATION
Lessee's performance of each of Lessee's obligations under this Lease is a condition as well as a
covenant. Lessee's right to continue in possession of the Property is conditioned upon such
performance. Time is of the essence in the performance of all covenants and conditions.
Lessor may terminate the Lease and take possession of the Leased Premises in the event that the
Lessee shall have failed to perform any of the covenants or conditions of the Lease, and such
default or deficiency in performance was not remedied by the Lessee within thirty(30)days after
receiving notice in writing stating the nature of the default or deficiency and the Lessor's
intention to terminate the Lease if not corrected.
ARTICLE 11. PROTECTION OF LENDERS
Section 11.1 Subordination:
Lessor shall have the right to subordinate this Lease to any ground lease, deed of trust or
mortgage encumbering the Property, any advances made on the security thereof and any
renewals, modifications, consolidations, replacements or extensions thereof, whenever made or
recorded. Lessee shall cooperate with Lessor and any lender which is acquiring a security
interest in the Property or the Lease.I Lessee shall execute such further documents and assurances
as such lender may require, provided that Lessee's obligations under this Lease shall not be
increased in any material way(the performance of ministerial acts shall not be deemed material),
and Lessee shall not be deprived of its rights under this Lease. Lessee's right to quiet possession
of the Property during the Lease Term shall not be disturbed if Lessee pays the rent and performs
all of Lessee's obligations under this Lease and is not otherwise in default. If any ground Lessor,
beneficiary or mortgagee elects to have this Lease prior to the lien of its ground lease, deed of
trust or mortgage and gives written notice thereof to Lessee, this Lease shall be deemed prior to
such ground lease, deed of trust or mortgage whether this Lease is dated prior or subsequent to
the date of said ground lease,deed of trust or mortgage or the date of recording thereof.
Section 11.2 Attornment:
If Lessor's interest in the Property is acquired by any ground Lessor, beneficiary under a deed of
trust, mortgagee, or purchaser at a foreclosure sale, Lessee shall attorn to the transferee of or
successor to Lessor's interest in the Property and recognize such transferee or successor as Lessor
under this Lease. Lessee waives the protection of any statute or rule of law which gives or
purports to give Lessee any right to terminate this Lease or surrender possession of the Property
upon the transfer of Lessor's interest.
Pavilion Building Lease 24
Section 11.3 Signing of Documents:
Lessee shall sign and deliver any instrument or documents necessary or appropriate to evidence
any such attornment or subordination or agreement to do so. If Lessee fails to do so within
twenty (20) days after written request,Lessee hereby makes, constitutes and irrevocably appoints
Lessor, or any transferee or successor of Lessor, the attorney-in-fact of Lessee to execute and
deliver any such instrument or document.
Section 11.4 Estoppel Certificates:
(a) Upon Lessor's written request, Lessee shall execute, acknowledge and deliver to Lessor a
written statement certifying: (i) that none of the terms or provisions of this Lease have been
changed (or if they have been changed, stating how they have been changed); (ii) that this Lease
has not been canceled or terminated; (iii) the last date of payment of the Base Rent and other
charges and the time period covered by such payment; (iv)that Lessor is not in default under this
Lease (or,if Lessor is claimed to be in default, stating why); and (v) such other representations or
information with respect to Lessee or the Lease as Lessor may reasonably request or which any
prospective purchaser or encumbrancer of the Property may require. Lessee shall deliver such
statement to Lessor within twenty (20) days after Lessor's request. Lessor may give any such
statement by Lessee to any prospective purchaser or encumbrancer of the Property. Such
purchaser or encumbrancer may rely conclusively upon such statement as true and correct.
(b) If Lessee does not deliver such statement to Lessor within such twenty (20) day period,
Lessor, and any prospective purchaser or encumbrancer,may conclusively presume and rely upon
the following facts: (i) that the terms and provisions of this Lease have not been changed except
as otherwise represented by Lessor; (ii) that this Lease has not been canceled or terminated
except as otherwise represented by Lessor: (iii) that not more than one month's Base Rent or
other charges have been paid in advance; and(iv) that Lessor is not in default under the lease. In
such event,Lessee shall be estopped from denying the truth of such facts.
ARTICLE 12. LEGAL COSTS
Section 12.1 Legal Proceedings:
If Lessee or Lessor shall be in breach or default under this Lease, such party (the "Defaulting
Party")shall reimburse the other party(the"Nondefaulting Party") upon demand for any costs or
expenses that the Nondefaulting Party incurs in connection with any breach or default of the
Defaulting Party under this Lease, whether or not suit is commenced or judgment entered. Such
costs shall include legal fees and costs incurred for the negotiation of a settlement, enforcement
of rights or otherwise.Furthermore,if any action for breach of or to enforce the provisions of this
Lease is commenced, the court in such action shall award to the party in whose favor a judgment
is entered, a reasonable sum,as attorneys' fees and costs. The losing party in such action shall
pay such attorneys' fees and costs. Lessee shall also indemnify Lessor against and hold Lessor
harmless from all costs, expenses, demands and liability Lessor may incur if Lessor becomes or
is made a party to any claim or action (a) instituted by Lessee against any third party, or by any
third party against Lessee, or by or against any person holding any interest under or using the
Pavilion Building Lease - 25
Property by license of or agreement with Lessee; (b) for foreclosure of any lien for labor or
material furnished to or for Lessee or such other person; (c) otherwise arising out of or resulting
from any act or transaction of Lessee or such other person; or (d) necessary to protect Lessor's
interest under this Lease in a bankruptcy proceeding, or other proceeding under Title 11 of the
United States Code, as amended. Lessee shall defend Lessor against any such claim or action at
Lessee's expense with counsel reasonably acceptable to Lessor or, at Lessor's election, Lessee
shall reimburse Lessor for any legal fees or costs Lessor incurs in any such claim or action.
Section 12.2 Lessor's Consent:
Lessee shall pay Lessor's reasonable attorneys' fees incurred in connection with Lessee's request
for Lessor's consent under Article 9 (Assignment and Subletting), or in connection with any
other act which Lessee proposes to do and which requires Lessor's consent.
ARTICLE 13. MISCELLANEOUS PROVISIONS
Section 13.1 Non-Discrimination:
Lessee promises, and it is a condition to the continuance of this Lease, that there will be no
discrimination against, or segregation of, any person or group of persons on the basis of race,
color, age, sex, sexual orientation,mental or physical disability, religion,"creed,national origin or
ancestry in the leasing, subleasing,;transferring, occupancy, tenure or use of the Property or any
portion thereof, unless exempted by applicable state or federal legislation or judicial or quasi-
judicial decisions.
Section 13.2 _Lessor's Liability; Certain Duties:
(a) As used in this Lease, the term"Lessor" means only the current owner or owners of the fee
title to the Property or Project or the leasehold estate under a ground lease of the Property or
Project at the time in question. Each Lessor is obligated to perform the obligations of Lessor
under this Lease only during the time such Lessor owns such interest or title. Any Lessor who
transfers its title or interest is relieved of all liability with respect to the obligations of Lessor
under this Lease to be performed on or after the date of transfer. However, each Lessor shall
deliver to its transferee all funds that Lessee previously paid if such funds have not yet been
applied under the terms of this Lease.
(b) Lessee shall give written notice of any failure by Lessor to perform any of its obligations
under this Lease to Lessor and to any ground Lessor, mortgagee or beneficiary under any deed of
trust encumbering the Property whose name and address have been furnished to Lessee in
writing. Lessor shall not be in default under this Lease unless Lessor (or such ground Lessor,
mortgagee or beneficiary) fails to cure such non-performance within thirty (30) days after receipt
of Lessee's notice. However, if such non-performance reasonably requires more than thirty (30)
days to cure, Lessor shall not be in default if such cure is commenced within such thirty(30) day
period and thereafter is diligently pursued to completion.
Pavilion Building Lease � 26
Section 13.3 Severability: •
A determination by a court of competent jurisdiction that any provision of this Lease or any part
thereof is illegal or unenforceable shall not cancel or invalidate the remainder of such provision
of this Lease, which shall remain in full force and effect.
Section 13.4 Interpretation:
The captions of the Articles or Sections of this Lease are to assist the parties in reading this Lease
and are not a part of the terms or provisions of this Lease. Whenever required by the context of
this Lease, the singular shall include the plural and the plural shall include the singular. The
masculine, feminine and neuter genders shall each include the other. In any provision relating to
the conduct, acts or omissions of Lessee, the term "Lessee" shall include Lessee's officers,
agents, employees, contractors, invitees, successors or others using the Property with Lessee's
expressed or implied permission. In any provision relating to the conduct, acts or omissions of
Lessor, the term "Lessor" shall include Lessor's officers, agents, employees, contractors,
invitees, successors or others using the Property with Lessor's expressed or implied permission.
Section 13.5 Incorporation of Prior Agreements; Modifications:
This Lease is the only agreement between the parties pertaining to the lease of the Property and
no other agreements are effective. All amendments to this Lease shall be in writing and signed
by all parties. Any other attempted amendment shall be void.
Section 13.6 Notices:
All notices required or permitted under this Lease shall be in writing and shall be personally
'delivered or sent by certified mail, return receipt requested, postage prepaid. Notices to Lessee
shall be delivered to the address specified in Section 1.3. Notices to Lessor shall be delivered to
the addressspecified in Section 1.2. All notices shall be effective upon delivery. Either party
may change its notice address upon written notice to the other party.
Section 13.7 Waivers:
All waivers must be in writing and signed by the waiving party. Lessor's failure to enforce any
provision of this Lease or its acceptance of rent shall not be a waiver and shall not prevent Lessor
from enforcing that provision or any other provision of this Lease in the future. No statement on
a payment check from Lessee or in a letter accompanying a payment check shall be binding on
Lessor. Lessor may, with or without notice to Lessee, negotiate such check without being bound
to the conditions of such statement.
Section 13.8 No Recordation:
Lessee shall not record this Lease without prior written consent from Lessor. However, either
Lessor or Lessee may require that a "Short Form" memorandum of this Lease executed by both
parties be recorded. The party requiring such recording shall pay all transfer taxes and recording
fees required to accomplish recordation.
Pavilion Building Lease 27
•
Section 13.9 Binding Effect; Choice of Law:
This Lease binds any party who legally acquires any rights or interest in this Lease from Lessor
or Lessee. However, Lessor shall have no obligation to Lessee's successor unless the rights or
interest of Lessee's successor are acquired in accordance with the terms of this Lease. The laws
of the State of Washington shall govern this Lease.
Section 13.10 Entity Authority:
If Lessee is an entity other than an individual or partnership, each person signing this Lease on
behalf of Lessee represents and warrants that he has full authority to do so and that his Lease
binds the entity. Within thirty (30),days after this Lease is signed, Lessee shall deliver to Lessor
a certified copy of a resolution of Lessee's Board of Directors or other governing body
authorizing the execution of this Lease or other evidence of such authority reasonably acceptable
' to Lessor. If Lessee is a partnership, each person or entity signing this Lease for Lessee
represents and warrants that he or it is a general partner of the partnership, that he or it has full
authority to sign for the partnership and that this Lease binds the partnership and all general
partners of the partnership. Lessee shall give written notice to Lessor of any general partner's
withdrawal or addition. Within thirty (30) days after this Lease is signed, Lessee shall deliver to
Lessor a copy of Lessee's recorded 'statement of partnership or certificate of limited partnership.
Section 13.11 Joint and Several Liability:
All parties signing this Lease as Lessee shall be jointly and severally liable for all obligations of
Lessee.
Section 13.12 Force Majeure:
If Lessor cannot perform any of its obligations due to events beyond Lessor's control, the time
provided for performing such obligations shall be extended by a period of time equal to the
duration of such events beyond Lessor's control. Such events include,but are not limited to, acts
of God, war, civil commotion, labor disputes, strikes, fire, flood or other casualty, shortages of
labor or material, government regulation or restriction, volcanic eruption, and weather
conditions.
Section 13.13 Execution of Lease:
This Lease may be executed in counterparts and, when all counterpart documents are executed,
the counterparts shall constitute a single binding instrument. Lessor's delivery of this Lease to
Lessee shall not be deemed to be an offer to lease and shall not be binding upon either party until
executed and delivered by both parties.
Section 13.14 Survival:
All representations and warranties of Lessor and Lessee shall survive the expiration or early
termination of this Lease.
Pavilion Building Lease 28
ARTICLE 14. BROKERS
Nothing contained in this Lease shall impose any obligation on Lessor to pay a commission or
fee to any party. Lessee represents and warrants to Lessor that it has not engaged any broker,
finder or other person who would be entitled to any commission or fees for the negotiation,
execution, or delivery of this Lease. Lessee shall indemnify, defend, and hold harmless Lessor
against any loss, cost, liability or expense incurred by Lessor as a result of any claim asserted by
any such broker, finder or other person on the basis of any arrangements or agreements made or
alleged to have been made by or on behalf of Lessee. This Article shall not apply to brokers with
whom Lessor has an express written brokerage agreement.
•ARTICLE 15. ACKNOWLEDGMENTS
Lessor and Lessee have signed this Lease on the dates specified adjacent to their signatures
below and have initialed all Exhibits and/or Riders which are attached to or incorporated by
reference into this Lease.
"LESSOR" "LESSEE"
City of Renton Spirit of Washington,Inc.
By By:
Kathy Keolker-Wheeler,Mayor Eric Temple,President
Date: , 2005 Date: , 2005
Attest:
By •
Bonnie Walton,City Clerk
Pavilion Building Lease
.Exhibit"A"—Legal Description
EXHIBIT "A"
LEGAL DESCRIPTION
Lots 2, 3, 16, 17 and 18,Block 2,Motor Line Addition to Renton, according to the plat thereof
recorded in Volume 9 of Plats,Page 150,Records of King County,Washington.
All situate in the Southeast Quarter;of Section 18,Township 23 North,Range 5 East,W.M.,in
the City of Renton, King County,Washington.
1
_
Pavilion Building Lease -
Exhibit"B"—Project Site Plan
EXHIBIT "B"
PROJECT SITE PLAN
Pavilion Building Site Plan:
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Pavilion Building Lease
' Exhibit"B"—Project Site Plan ii
Vicinity Map with the Pavilion Building and Common Exterior Areas (including the Piazza Park
on the south side of the Pavilion Building and the public parking lot, Renton Transit Center and
City Center Parking Garage on the north side of the Pavilion Building):
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OFIRST FLOORPLAN
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•
Pavilion Building Lease
Exhibit"C"—Floor Load Rating Specifications
EXHIBIT "C" •
FLOOR LOAD RATING SPECIFICATIONS
The stringerless load ratings in the following InterfaceAR TecCrete Panel specifications sheet
apply to the Pavilion Building floor,
Pavilion Building Lease ---
Exhibit"C"—Floor Load Rating Specifications - ii
InterfaceAR' TecCrete" Panel Cat No. CFPXCL13.
•
a of
Lightweight "°
High-strength CFPXCLI3 Corner Lack Panel
Concrete Corner Section(Full Insert)
(Bare Finish)
it •
Shear Tab
(TYPO
n ,o
•
Top View
•
VQ o or o o ,,,, ire
0 0 0 O o 0
00 0 0 o O Oa
Guage
g 0 0 0 O' 0 0 0 GGalvanized
Steel -
a0 0 O o * 0C mom
a O O 0 Q o.LI
o O d o o ~'� `_:J 4
d�Q` a a c o �! fi j
Bottom ViewElectrical
Continuity Corner Insert Enlarged Typical Bare
Cbiitact Tec-Crate
Specifications: Corner Lock
lightweight High-strength.Concrete Configuration
24 Cadge hot-dipped Galvanised Steel
Panel Size:. Nom napp; 24e 24"11/8""
Finished Floor Height;2-112":to 41.
09eroll'.Pedestot Mjustment'2e(FFH>6")
T.olerdnce!Nominal panel size 1-0.015'; flatness'k squareness within ±0.015:
Tee.Crete performance ratings •
• Rolliing load's are expressed it pounds per caster, oil other data is.stated in maximum pounds Of toad and inches of deflection or permanent set
• Total System Weight= 11:5.ibs./sq. ft. (up to 2r FFH).
Key to performance ratings
InterfaceAR:has tested its flooring system to "Recommended Test Procedures for Access Flooring'--Ceiling and Interior Systems Construction A,esocjaton
(CISCA).- 'Uniform and Impact tests have also been conducted. Stringers are-edge supporting. Testing.reflects weakest point,top surface deflection
in accordance with CISCA.
1.) Uniform load data is based on.maximum deflection of 0.040` Typical.slobs under access floors hove uniform load capacities less than the rating
of the lowest uniform toad capacity of any C-TEC series floor.
2.) Rolling tests used in the CISCA test procedures are performed as follows: 10.posses with.a 3":x 113/16."-caster, 10,000 posses with a
- V x 1-1/2"caster. Worst-case permanent set(inches)Is.strewn'for each system.
3.) Impact tests are based on 36"drops onto a.1 inch square indenter without ultimate fgifure of the-sy§tem.
Rolling! Impact=, . Concentratesi Unifortil' Ultimate,
Stringerless Stringer Stringerless Stringer Stringerless. Stringer Stringerless• Stringer Stxingexiess :$tilnger
10 passes 'a ere 10 passes. gs . - PSI F!SI. PSF PSF PSI PSI
1200<.010 •6000010 1200<.010 8006010 150 150 1300<.080_ :1600<.080.' 400<.040 .450<.050 1606 2404 '
Interface Architectural Resources Internet:w, Jnterfacear com
3700 32nd.Street SF,Grand Rapids,MI 49512-1824 Telephone:616-9Ti-8600 Fac 618-977-8617
Menefeeturer reserves the t(ght..to-dangt'apetlncatleas without Welke
Dwa.:170.cot
Pavilion Building Lease
Exhibit "D"
Buy-Out Schedule
Projected Initial Capital and Start-up Expenses
June 21,2005
(�'""'Ei' .� un c:`7s.:�iEt%�I• '`r<"a"`c'Yc'1�.2.�m�..»..;5-'rv�'� •r�Kw,-�- v�.c,�"`N's,`:r' S
'Cab of o [eliis� .<4 '«.Q' �;:. tAzyo .�:.�
Description Price Pack Quantity Needed Total
in dozens in dozens
10 3/4"Dinner Plates $67.42 2 48 $1,618.08
9" Salad/Dessert Plates $57.38 2 96 $2,754.24
6"B&B Plates $36.07 2 48 $865.68
Salad/Dessert Forks $24.30 3 96 $777.60
Dinner Forks $30.14 3 48 $482.24
Tea Spoons $14.58 1 48 $699.84
Dinner/Butter Knives $41.30 1 48 $1,982.40
Steak Knives $14.50 1 48 $696.00
Water Glasses $79.84 3 96 $2,554.88
Wine Glasses $79.84 3 96 $2,554.88
Champagne Flutes $79.84 3 48 $1,277.44
Coffee Cups $63.60 3 48 $1,017.60
Bread Baskets $24.95 1 10 $249.50
Salt/Pepper Shakers $14.12 2 20 $141.20
Sugar Caddy's $78.47 2 10 $392.35
Table Lamps $158.44 0.5 5 $1,584.40
Tax 8.8% $1,729.05
"Tab1e Ta• TOW% ..:20V:.43,61
Se ilLS a .teri�s s � ,'p 7 ,,Z7 _Ni0
Description Price Pack Quantity Needed Total
each
Glass Racks 36 Slots(wine/water) $29.40 1 80 $2,352.00
Glass Racks 25 Slots(Coffee Cups) $25.29 1 25 $632.25
Chafer Dishes(full size) $115.96 1 8 $927.68
Chafer Dishes(1/2 size) $78.96 1 3 $236.88
Coffee Percolators 55 Cup S.S. $158.95 1 6 $953.70
Water Pitchers $11.13 1 20 $222.60
Salad/Punch Bowls $26.04 1 10 $260.40
Bar Wares(shaker,pour spouts,ect.) $75 1 3 $225.00
Buffet Tongs $3.73 1 40 $149.20
Buffet Spoons(slotted) $5.59 1 15 $83.85
Buffet Spoons(solid) $6.05 1 15 $90.75
Cake Server $18.95 1 2 $37.90
Cake Knife $19.85 1 2 $39.70
"Serving Trays and Platters"
11 3/4"S.S. Round $18.20 1 8 $145.60
13 3/4"S.S. Round $21.78 1 4 $87.12
15 3/4°S.S.Oval $21.78 1 4 $87.12
26 3/4"S.S.Oval $50.35 1 2 $100.70
15 3/4"S.S. Rectangular $25.34 1 2 $50.68
19 1/2"S.S. Rectangular $31.86 1 2 $63.72
Pepper Mills $34.35 1 20 $687.00
Wicker Baskets $20.00 1 8 $160.00
26"Bussing/Serving Trays $23.60 1 20 $472.00
Tray Stands S.S. $23.67 1 20 $473.40
Lexan Containers 18°x 25" $21.50 1 9 $193.50
12"x 16"Service Trays $13.95 1 30 $418.50
Tax 8.8% $805.31
k>fie icelli are=T:pta-!: ,:-V'; 4 .9'956;56,
•
Kitcer' Equi ine totems r°< r; <F•
.�.Q P�:.-„:�.,. ,vim. y.: :��a.:�-
Price Pack Quantity Needed Total
each
Hot Boxes(pan holders) $250.00 1 4 $ 1,000.00
Portable Deep Fryer $495.48 1 1 $ 495.48
Portable Convection Oven $785.00 1 1 $ 785.00
Heat Lamps $111.37 1 2 $ 222.74
Butane Burners $38.00 1 4 $ 152.00
Ice Machine $6,647.30 1 1 $ 6,647.30
Hot Holding Cabinets $1,619.78” 1 2 $ 3,239.56
Portable Bar $1,057.62 1 2 $ 2,115.24
Utility Cart $90.44 1 3 $ 271.32
Tax 8.8% $1,313.72
ch . :Ail.'$'`,i4.:T'4ta 2-X d!=
Price Pack Quantity Needed Total
t cr- i nnen 1 w zrA -.� •_w each
Chairs Stacking Vinyl $ 22.00 1 655 $ 14,410.00
Tables 60 inch round wood $ 180.00 1 55 $ 9,900.00
Tables 8 foot rectangles $ 152.00 1 14 $ 2,128.00
Tables 6 foot rectangles $ 141.00 1 14 $ 1,974.00
Table Racks $ 140.00 1 6 $ 840.00
Stacking Chair Movers $ 129.00 1 3 $ 387.00
Tax 8.8% $2,608.23
taik'U A._e isr ", - ,7 '; I :M•
,N}et er +d'.rie .aa _,. 2.=,32 '
Trade Shows: Brides Club
Tacoma Fall Wedding Expo $1,000.00
Seattle Fall Wedding Expo $1,000.00
Lynn/Everett Fall Wedding Expo $1,000.00
Lynn/Everett Winter Wedding Expo $1,000.00
Bellevue Winter Wedding Expo $1,000.00
Tacoma Winter Wedding Expo $1,000.00
Trade Shows:Banquet and Event Inc.
Fall Bridal Spectacular $500.00
Northwest Event Show $500.00
Trade Shows:Wedding
Seattle Winter Wedding Show $1,600.00
Trade Shows:Chamber Business Expos
Renton $500.00
Seattle $1,000.00
Bellevue $1,000.00
Kent $500.00
Southwest Seattle $500.00
Print Advertising
Wedding Expo Magazine $1,200.00
Seattle Wedding Guide $1,000.00
Seattle Event Guide $750.00
Chamber News Letter Inserts $2,000.00
Puget Sound Business Journal-Jan and Aug Issues $2,000.00
Yellow Pages-Seattle,Tacoma,Eastside,Southside $15,000.00
Seattle Visitor Bureau-Meeting Planning Guide $3,600.00
Events Planning Resource $2,500.00
Full Color Brochure $10,000.00
Print Production-Creative and Other $20,000.00
Brochure, Logo,Letterhead,8x11 Quick Reference
Presentation Folders
Web Advertising
Seattle Wedding Guide Site $250.00
Seattle Event Guide Site $250.00
BridesClub.com $1,000.00
Brides Northwest.com $3,000.00
Website Development $25,000.00
Television
Brides Northwest Show-24 Spots $4,000.00
Radio $25,000.00
Office Supplies,Postage $5,000.00
OPENING GALA $25,000.00
Sta.;-Ups tdvertisib•1,01 -> 15..8650 0Q
Tenant-lm•ro,
Carpet $ 36,000.00
Window Coverings $ 40,000.00
Lounge Area with Bar and Coffee Station,Coat Check $ 18,000.00
Planters and Tall Trees with Movable Pots $ 20,000.00
AWL•,•v menotal $ i4 00Q;00
Table Top Total $21,377.38
Service Ware Total $9,956.56
Kitchen Equipment Total $16,242.36
Other Equipment Total $ 32,247.23
Start-Up Advertising Total $158,650.00
Tenant Improvement Total $ 114,000.00
Grand Total $ 352,473.54
Pavilion Building Lease
Exhibit"D"
Buy-Out Schedule
Projected Depreciation&Estimated Buy-Out Figures*
June 21,2005
Months 1-12 Months 13-24 Months 25-36 Months 37-48 Months 49-60 Months 61-72 Months 73-84 Months 85-96 Months 97.108 Months 109-120
Non-Moveable Capital Costs
Carpet $ 36,000.00
Window Coverings $ 40,000.00
Sub-Total $ 76,000.00
Depreciation $ 4,560.00 $4,560.00 $4,560.00 $4,560.00 $4,560.00 $4,560.00 $4,560.00 $4,560.00 $4,560.00 $4,560.00
Residual Value $ 71,440.00 $66,880.00 $62,320.00 $57,760.00 $53,200.00 $48,640.00 $44,080.00 $39,520.00 $34,960.00 $30,400.00
Moveable Capital Costs
Table Top Items $21,377.38
Service Ware Items $9,956.56
Kitchen Equipment Items $16,242.36
Other Equipment $ 32,247.23
Lounge Area with Bar and Coffee Station,Coat Check $ 18,000.00
Planters and Tall Trees with Movable Pots $ 20,000.00
Sub-Total $117,823.54
Depreciation $ 7,069.41 $7,069.41 $7,069.41 $7,069.41 $7,069.41 $7,069.41 $7,069.41 $7,069.41 $7,069.41 $7,069.41
Residual Value $110,754.12 $103,684.71 $96,615.30 $89,545.89 $82,476.47 $75,407.06 $68,337.65 $61,268.24 $54,198.83 $47,129.41
Up-front Marketing Costs
Start-Up Advertising $158,650.00
Depreciation $22;664.29 $22,664.29 $22,664.29 $22,66429 $22,664.29 $22,664.29 $22,664.29
Residual Value $135,985.71 $113,321.43 $90,657.14 $67,992.86 $45,328.57 $22,664.29 $0.00
TOTAL $352,473.54
Depreciation $ 34,293.70 $ 34,293.70 $ 34,293.70 $ 34,293.70 $ 34,293.70 $ 34,293.70 $ 34,293.70 $ 11,629.41 $ 11,629.41 $ 11,629.41
Residual Value $318,179.84 $ 283,886.14 $ 249,592.44 $ 215,298.74 $ 181,005.05 $ 146,711.35 $ 112,417.65 $ 100,788.24 $ 89,158.83 $ 77,529.4,
Buy-Out Amount for Lessor Terminating Lease for
Another Event Use as provided for in Subsection 1.6.3." N/A N/A N/A $215,298.74 $181,005.05 $146,711.35 $112,417.65 $100,788.24 $89,158.83 N/A
'Note: The Depreciation values above reflect the total for each twelve(12)-month period and the Residual Values above reflect the total(after depreciation)at the end of each twelve(12)-month period.
•
•
Pavilion Building Lease
Exhibit`'`E"—Maintenance Schedule i
EXHIBIT"E"
MAINTENANCE SCHEDULE
Lessee shall provide all equipment and cleaning supplies, including,but not limited to: paper
products (toilet paper, seat covers, sanitary napkins/tampons,paper towels), sani-fresh soap, air
fresheners, and light bulbs. Lessee shall submit samples of all materials and supplies to the City
for approval before use.
I. CUSTODIAL
General Building Specifications
A. Daily Services (if building occupied):
1. Empty waste receptacles and dispose of waste daily and recycling 1-2 times per week.
2. Replace liners.
3. Spot clean work surfaces for spillages and stains.
4. Arrange furniture in a neat and orderly manner.
5. Vacuum all carpeted areas and spot clean as needed.
6. Spot clean walls around light switches and doorframes.
7. Sweep and damp mop hard surface floors where applicable.
8. Clean entry area and entry area windows and doors.
B. Weekly Service
1. Dust window ledges and other horizontal surfaces within reach.
2. Dust and clean accessible surfaces. Use glass cleaner where applicable.
3. Change light bulbs as needed, (to be provided by contracted firm).
4. All telephones to be sanitized clean including public pay phone.
C. Monthly Services:
1. Vacuum heating and air return vents.
2. Detail vacuum corners and edges of carpeted areas.
3. Perform dusting of high and low ledges and surfaces.
4. Walls to be spot cleaned and dusted.
Restrooms Specifications
A. Daily Services Of building occupied or restrooms utilized)
1. Dust mop and sweep floor surface.
2. Damp mop floor surfaces with pH neutral disinfectant cleaner.
3. Empty and clean all waste containers,including sanitary napkin receptacles, and
replace liners.
4. Check and refill all dispensers;paper towels,toilet tissue, seat covers and hand soap.
(All paper products,hand soap and air fresheners furnished by Lessee.)
Pavilion Building Lease -
Exhibit"E"—Maintenance Schedule
5. Clean and polish mirrors and dispensers.
6. Clean counters, washbasins and soap dispensers.
7. Clean and sanitize toilets, toilet seats and urinals.
8. Clean and polish chrome fixtures.
9. Clean walls around sinks, towel dispensers,urinals,partitions and doorframes.
10. Change light bulbs as needed.
11.Fill sanitary napkiri/tampon dispensers.
B. Monthly Services
1. Wipe down walls not done daily.
2. Vacuum air vents.
3. Machine scrub floors.
4. Dust tops of partitions,mirrors and frames.
C. Annual Services (once per year)
1. Re-seal concrete floors, unless the floor is carpeted or the existing seal is deemed
adequate by Lessor.
Common Area Lobbies/Hallways Specifications
A. Daily Service(if building occupied)
1. Empty and reline waste receptacles(interior and exterior).
2. Spot clean entry door glass.
3. Sanitize and polish drinking fountain.
4. Vacuum carpeted areas in lobbies daily and spot clean as needed.
5. Police and dispose of litter and debris in entranceways.
6. Change light bulbs as needed, (to be supplied by Lessee).
B. Annual Service(once per year)
1. Extraction clean all carpeted areas.
2. Carpet-protector application to cleaned carpet.
3. Vinyl floors stripped and waxed.
II. MECHANICAL
See the following schedules.
Pavilion Building Lease
Exhibit"E"—Maintenance Schedule . iii
-
•
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P-01 Hot Water Pump Heating Water Pump OP OP
P-02 Hot Water Pump Heating Water Pump OP OP
P-03 Pump Circulation Domestic Recirculation Pump OP OP
. .
P-04 Chilled Water Pump Chilled Water Pump OP OP
, -
P-05 Condenser Water Pump Condenser Water Pump OP OP
P-06 Pump Preheat Coil Pump OP OP
P-07 Pump Preheat Coil Pump OP OP
EXT-01 Expansion Tank Bladder Expansion Tank OP OP
EXT-03 Expansion Tank Bladder Expansion Tank OP OP
EXT-04 Expansion Tank Bladder Expansion Tank OP OP
EXT-05 Expansion Tank Bladder Expansion Tank OP OP
B-01 Boiler Gas Oil Condensing Fire Tube Boiler OP AN OP OP
- .
DHWT-01 Water Heater Water Heater OP AN OP OP
, .
HX-01 Heat Exchanger Plate Heat Exchanger AN
_
HX-02 Heat Exchanger Plate Heat Exchanger AN
•
•
Pavilion Building Lease
Exhibit"E"—Maintenance Schedule iv
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JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
EF-01 Exhaust Fan Exhaust Fan OP OP OP OP
EF-02 Exhaust Fan Exhaust Fan OP OP OP OP
EF-03 Exhaust Fan Exhaust Fan OP OP OP OP
EF-04 Exhaust Fan Exhaust Fan OP OP OP OP
EF-05 Exhaust Fan Exhaust Fan OP OP OP OP
UH-01 Heater Unit Heater OP OP
UH-02 Heater Unit Heater OP OP
UH-03 Heater Unit Heater OP OP
UH-04 Heater Unit Heater OP OP
UH-05 Heater Unit Heater OP OP
. . _
UH-06 Heater Unit Heater OP OP
UH-07 Heater Unit Heater OP OP
UH-08 Heater Unit Heater OP OP
EH-01 Heater Unit Heater OP OP '
BB-01 Heater Unit Heater OP OP
_ .
PRC-01 Heating Coil Heating Coil OP OP
PRC-02 Heating Coil ' Heating Coil OP OP
CH-01 Chiller Chiller AN OP OP OP
CT-01 Cooling Tower Cooling Tower AN OP OP OP
. ,
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Pavilion Building Lease
• Exhibit"E"—Maintenance Schedule v
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FB-01 VAV Box • VAV Box Fan Powered OP OP OP OP
FB-02 VAV Box VAV Box Fan Powered OP OP OP OP
FB-03 VAV Box VAV Box Fan Powered OP OP OP OP
FB-04 VAV Box VAV Box Fan Powered OP OP OP Or
FB-05 VAV Box VAV Box Fan Powered OP OP OP OP
FB-06 VAV Box VAV Box Fan Powered OP • OP OP OP
FB-07 VAV Box VAV Box Fan Powered OP OP OP OP
FB-08 VAV Box VAV Box Fan Powered OP OP OP OP
FB-09 VAV Box VAV Box Fan Powered OP OP OP OP
AHU-01 Air Handler Air Handling Unit OP OP OP OP
AHU-02 Air Handler Air Handling Unit OP OP OP OP
SF-01-1 Supply Fan Supply Fan OP OP OP OP
RF-01-1 Return Fan Return Fan OP - OP OP OF
SF-02-1 Supply Fan Supply Fan OP OP OP OP
RF-02-1 Return Fan Return Fan - OP OP OP OP
ST-01 Strainer 0 AN
VFD-01 Variable Frequency Drive Variable Frequency Drive OP OP OP OP
VFD-02 Variable Frequency Drive Variable Frequency Drive OP OP OP OP
Pavilion Building Lease
•
Exhibit"E"—Maintenance Schedule - vi
Preventative Maintenance Schedule-Key to Abbreviations
Ili Oo Dhow
MJ Major Inspection
MI Minor Inspection
AN Annual Inspection
OP Operational Inspection
FC Filter Change Only
CC Coil Cleaning
BRG Bearing Analysis
VIB Vibration Analysis
MCA Motor Circuit Analysis
US Ultrasonic Survey
REF Refrigerant Analysis
OC Oil Change
OIL Oil Analysis
LS Laser Shaft Alignment
LP Laser Pulley Alignment
EDD Eddy Current Analysis
BC Belt Change
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Site Visit Baseline Drive Motors
• Check-in with site contact person , • Check all hold down bolts
• Check for safe equipment access • Check motor fan
• Isolate equipment&lock out • Check and record SPM
• Document work done during inspection • Check end bells for dirt or debris
■ Check out with site contact
Drive Components
Operational Inspection • Check sheaves for wear and alignment
• Verify operation • Check long coupling alignment
■ Document performance&deficiencies • Lube coupling as needed
• Check coupling for looseness or wear
Performance • Check drive belt for wear
• Record runtime and start counts
• Check and record evaporator pressure Evaporator
•
•
• Check and record evaporator water temps. Check for leaks
•
• Check and record chilled water temps. Record pressures/temperatures
•
• Check refrigerant charge Check expansion valve
• Check and record superheat/subcooling Compressor
• Check and record condenser pressure • Check and record oil pressure
• Check and record condenser temperatures
•
• Check dry eye and record color Check and record oil level
• Check for leaks
• Check starter/contactor for wear and
Condition Monitoring pitting
• Check for improper vibration
• Check amperage for wear and pitting -
• Check crankcase heater operation
Safeties • Inspect siteglass for leaks
• Check pressure switches for leaks
• Check pressure relief valves Lubrication
• Lube motor bearings as required
Electrical • Lube solid coupling as required
• Check for loose or burnt wiring
• Check all contacts for wear or pitting Housekeeping
• Check starter contacts • Wipe off excess lubricants
• Check all electrical connections • Clean up work area
• Check amperages and voltages
Optional Tasks
Controls • Calibrate system pressure gauges
• Check all terminations in control panel ■ Calibrate system electrical gauges
• Exercise controls where possible • Open and inspect evaporative tubes
• Check cabinets for debris • Eddy current tubes
▪ Check internal interlocks
• Open and inspect condenser tubes
• Brush condenser tubes
*Not all tasks are applicable to all equipment
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• . . . . Preventative Maintenance Task List* .
Site Visit Baseline Drive Components
• Check-in with site contact person • Check sheaves for wear and alignment
• Check for safe equipment access • Lube coupling as needed
• Isolate equipment&lock out • Check long coupling alignment
• Document work done during inspection • Check coupling for looseness or wear
• Check out with site contact • Check drive belts for wear
Operational Inspection Evaporator
• Verify operation • Check liquid line filter/dryer
• Document performance&deficiencies • Check for leaks
• Check expansion valve
Performance • Check cleanliness
• Record runtime and start counts • Record pressures/temperatures
• Check and record oil temperature
• Check and record oil pressure Compressor
• Check and record evaporator pressure • Check and record oil pressure
• Check and record evaporator water temps. • Check and record oil level
• Check and record condenser pressure • Change oil filter
• Check and record condenser temperatures • Inspect oil filter
• Check dry eye and record color • Clean oil return line strainer
• Check and record chilled water temps. • Check for leaks
• Check refrigerant charge • Check starter/contactor for wear and
• Check and record superheat/subcooling pitting
• Check and record volts/amps
Condition Monitoring • Check crankcase heater operation
• Check for improper vibration • Inspect siteglass for leaks
• Megger compressor motor and record
Safeties
• Check and test all safety controls Lubrication
• Check pressure switches for leaks • Take oil sample for analysis
• Check pressure relief valves • Lube motor bearings
• Check and record oil pump volts/amps
Electrical • Megger oil pumps and record
• Check for loose or burnt wiring
• Check all contacts for wear or pitting Housekeeping
• Check starter contacts • Wipe off excess lubricants
• Check and torque all electrical connections • Clean up work area
• Check and calibrate over loads
• Record overload trip amps and trip times Controls
• Check amperages • Check all termination in control panels
• Exercise controls
• Check cabinets for debris
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Drive Motors Optional Tasks
• Check all hold down bolts
• Calibrate system pressure gauges
• Check end bells for dirt or debris I • Calibrate system electrical gauges
• Check motor fan • Clean coils
■ Check internal interlocks
■ Open and inspect evaporator tubes
• Change oil based on analysis
• Open and inspect condenser tubes
• Brush condenser tubes
*Not all tasks are applicable to all equipment
•
•
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Site Visit Baseline Housekeeping
• Check-in with site contact person • Wipe off any excess lubricant
• Check for safe equipment access Clean up work area
• Isolate equipment&lock out
• Document work done during inspection *Not all tasks are applicable to all equipment
• Check out with site contact
Operational Inspection
• Verify operation of unit
• Note any abnormal vibration or noise
Safeties
• Check for loose or burn wiring
Controls
• Check all terminations in control panel
Drive Motor
• Check for dirt&debris around end bell •
• Check motor cooling fan
• Check motor mounting fasteners
• Check bearings for wear and end play
• Check motor mounting bracket
Drive Components
• • Check sheaves for wear
•
Fan
• Check for correct fan rotation during wind
down
• Check fan for obstructions or debris
• Check fan blades for cracks
• Check fan blades for dirt build-up
• Check fan to housing clearances
•
• Check rain guard
Lubrication
• Lubricate motor and fan bearing
General Maintenance
• Check for corrosion
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Site Visit Baseline Fan
• Check-in with site contact person • Check for correct fan rotation during wind
• Check for safe equipment access down
• Isolate equipment&lock out • Check fan for obstructions or debris
• Document work done during inspection • Check fan blades for cracks
• Check out with site contact • Check fan blades for dirt build-up
• Check fan to housing clearances
Operational Inspection • Check&tighten bearing collar set screws
• Verify operation of unit • Check rain guard
• Note any abnormal vibration or noise .
Lubrication
Performance • Lubricate motor and fan bearings
• Check&record motor amps
• Check fan speed General Maintenance
• Check for corrosion
Safeties
• Check for loose or bum wiring Housekeeping
• Check all trip points • Wipe off any excess lubricants
• Clean up work area
Electrical
• Check electrical contacts for wear or *Not all tasks are applicable to all equipment
pitting
• Check and tighten electrical connections
Controls
• Check all terminations in control panels
• Exercise controls
Drive Motor
• Check for dirt&debris around end bell
• Check motor cooling fan
• Check motor mounting fasteners
• Check bearings for wear and end play
• Check motor mounting bracket
Drive Components
• Check sheaves for wear
• Check sheave set screws
• Check drive belts for wear&cracking
• Check sheave alignment
• Check belt guard alignment
• Check bearing for wear and end play
•
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Site Visit Baseline Gas
• Check-in with site contact person • Check for gas leaks
• Check for safe equipment access • Check flame quality and orifices
• Isolate equipment&lock out • Check ignition operation
• Document work done during inspection • Check for soot
• Check out with site contact • Assure fuel shutoff
• Check gas pressure regulator
Operational Overview • Check induced draft operation
• Verify overall operation ■ Check blower static pressure
• Check water level devices •
• Check boiler pressure *Not all tasks are applicable to all equipment
• Check pressure relief valve
• Inspect sacrificial anode
• Perform blowdown
Electrical
• Check operating voltage
• Check contactors
• Check Hi Temp/Hi Pressure cutout
• Check function of step controller -
• Check fuses and their blocks
• Check wiring
• Tighten connections
• Take amperage readings .
Plumbing
• Visually inspect for water leaks
• Visually inspect valves
• Clean feedwater strainers
• Check sightglasses •
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Site Visit Baseline Thermostat
• Check-in with site contact person • Check operation with amp meter
• Check for safe equipment access
• Isolate equipment&lock out Pressure Relief Valve
• Document work done during inspection • Check valve operation
• Check out with site contact • Check for leaks
• Check for corrosion
Operational Inspection
• Verify overall operation General Maintenance
• Check for water leaks
Performance • Check for corrosion
• Drain several gallons from tank to remove
sediment Operational Tasks
• Check water temperature • Check sacrificial anode
• Check pressure relief valve
Safeties
• Check for loose or burn wiring *Not all tasks are applicable to all equipment
• Check trip all trip points
Electrical
• Check electrical contacts for wear &
pitting
• Check and tighten electrical connections
Burner
• Check ignition system
• Check burners •
• Check flame quality
• Check for CO traces
• Check flu
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Site Visit Baseline Thermostat
• Check-in with site contact person , ■ Check operation with amp meter
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® Isolate equipment&lock out Pressure Relief Valve
• Document work done during inspection • Check valve operation
• Check out with site contact • Check for leaks
• Check for corrosion
Operational Inspection
• Verify overall operation General Maintenance
• Check for water leaks
Performance • Check for corrosion
• Drain several gallons from tank to remove
sediment Operational Tasks
• Check water temperature • Check sacrificial anode
• Check pressure relief valve
Safeties
■ Check for loose or burn wiring *Not all tasks are applicable to all equipment
• Check trip all trip points
Electrical
• Check electrical contacts for wear &
pitting
• Check and tighten electrical connections
•
Burner
• Check ignition system
• Check burners
• Check flame quality
• Check for CO traces
• Check flu
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Site Visit Baseline Exhaust Fan Section
• Check-in with site contact person • Inspect bearings for excessive wear and
• Check for safe equipment access end play
• Isolate equipment&lock out ■ Number and size of belts
• Document work done during inspection • Inspect Fan blade
• Check out with site contact • Verify proper operating of fans
• Lubricate fan and motor
Operational Overview
• Note current outside air temp and weather Filter Section
conditions • Note filter condition
• Verify overall operation • Change filters per schedule
• Note any abnormal vibration or noise • Note condition of outs de air filters/screens
•
Indoor Coils *Not all tasks are applicable tip all equipment
• Note cleanliness of coil
• Check for refrigerant leaks
• Check for condensate pan and drain - -
• Check for water leaks
Controls
• Check all terminations in control panel
Economizer Section
• Check for dirt accumulation .. .
Return Fan Section
• Inspect bearings for excessive wear and
end play
• Number and size of belts
• Inspect fan blade
• Verify proper operation of fans
• Lubricate fan and motor
Supply Fan Section
• Inspect bearings for excessive wear and
end play
• Number and size of belts
• Inspect fan blade
• Verify proper operation of fans
• Lubricate fan and motor
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Site Visit Baseline Return Fan Section
• Check-in with site contact person • Inspect bearings for excessive wear and
• Check for safe equipment access end play
• Isolate equipment and lock out • Adjust pulleys and belts
• Document work done during inspection • Number and size of belts
• Check out with site contact • Record operating volts
• Record operating amps
Operational Overview • Inspect fan blades
• Note current outside air temp and weather • Verify proper operation of fans
conditions • Lubricate fan and motor
• Verify overall operation
• Check/Record supply air temperature Supply Fan Section
• Check/Record return air temperature • Inspect bearings for excessive wear and
▪ Check/Record system static pressure end play
• Note any abnormal vibration or noise • Adjust pulleys and belts
• Number and size of belts
Indoor Coils • Record operating volts
• Note cleanliness of coil • Record operating amps
• Record deltaP across coil • Inspect fan blade
• Record detlaT across coils • Verify proper operation of fans
• Check for refrigerant leaks • Lubricate fan and motor
• Check for condensate pan and drain
• Check for water leaks Exhaust Fan Section
• Inspect bearings for excessive wear and .- .
Controls end play
• Check all terminations in control panel • Adjust pulleys and belts
• Exercise controls • Number and size of belts
• Check VFD/IGV ■ Record operating volts
• Check safeties and trip points • Record operating amps
• Check ambient controls • Inspect fan blade
• Verify proper operation of fans
Economizer Section • Lubricate fan and motor
• Check for dirt accumulation
• Check for damper actuator and linkage Filter Section
operation • Note filter condition
• Check and adjust minimum position Change filters per schedule
• Check operation of pressure relief dampers ■ Note condition of outside air filters/screens
*Not all tasks are applicable to all equipment
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Site Visit Baseline • Fan
• Check-in with site contact person • Check for correct fan rotation during wind
• Check for safe equipment access down
• Isolate equipment and lock out • Check fan for obstructions or debris
• Document work done during inspection • Check fan blades for cracks
• Check out with site contact • Check fan blades for dirt build-up
• Check fan to housing clearance
Operational Inspection • Check and tighten bearing collar set screw
• Verify operation of unit • Check rain guard
• Note any abnormal vibration or noise
Lubrication
Performance • Lubricate motor and fan bearing
• Check and record motor amps
• Check fan speed General Maintenance
• Check for corrosion
Safeties
• Check for loose or burnt wiring Housekeeping
• Check all trip points • Wipe off any excess lubricants
• Clean work area
Electrical
• Check electrical contacts for wear and *Not all tasks are applicable to all equipment
pitting
• Check and tighten electrical connections
Controls
• Check all terminations in control panels
• Exercise controls
Drive Motor
• Check for dirt and debris around end bell
• Check motor cooling fan
• Check motor mounting fasteners
• Check bearings for wear and end play
• Check motor mounting brackets
Drive Components
• Check sheaves for wear
• Check sheaves set screws
• Check drive belts for wear and cracking
• Check sheave alignment
• Check belt guard alignment
• Check bearings for wear and end play
• Inspect bearings for excessive wear and
end play
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Six-Month Inspection and Preventative Maintenance
* Roll Up Doors
•
Annual Inspection and Preventative Maintenance
* Storefront and standard access doors, hardware and locking mechanisms
* Roof system
•
Annual Inspection
* Backflow prevention value
•
I e
•
•
.
Summary of Additional Changes to Pavilion Building Lease
6/21/05
I. Summary of Additional Changes to Pavilion Building Lease
Section 1.1—Date of Lease and Section 1.6 Lease Term
Changed date of Lease and Commencement Date from 6/15/05 to 6/30/05.
..,�.._..�i ,.�_._., ; � -.� .;s.: ,.. - a`': -_ ._,. "-it.•s.�+.. ..�. s'rh`�":a;�a Ya-sa':ix�;'..d:
Subsectionni 3.2.-Adf Pro ert to be:Leased�-b Le
._.... .- � _ . .._. .. . _.. dress o__. .. _.._ :., P.: Yom.<.. .-. YP:...>a ssee�..:....
Corrected>zipcode
•
-- i onof Lease=bb `Lessor aforAnother `Eve t:Use,
Sutsecto'ii�1<.63Ear�bTernat o�,. .�, by .._.a.�,__...�>.,
a�•„ _ «.v. yt.. �.�.s'-' - "' :`;t::r;?;^' ..,n4 .' '+" -.z:".�";"�.y..�;.�y,-y,.s;�,y,-�'r��-,s,.3..�. ,4aa, ..�,,rc;
Modified thedefinitiowkof an<.event:.'..in part joschangexfrom=a block;ofptime of at-least':two
seach ORa� reakfa�..sto<.:.�'.=l incwth4'�(lor.'m"•,<ore,iattend'ees.itoablock,a tu
lock:oti eYofa
t
least`Oneand a-,,half( /)hou1`^r '.eac-.;z.h with
f'orty:. (40)om,.. re<;tatten�,r•dek+esO`' R a. ,.b'area'-kfast:o.SrEI
lunch neeting;with forty(40)(or�^more-attendees.
ect ori 1 8.-I itialSecurity Deposit
increasedd"thexi itia Rsecurit.�-ode posit.from) 3 000.Rto1$l0,O00
.,�.�•.-.sr.� ��'�,».«.€»E. �,.s,...._..:<.t..
•;•;�,.a��`-u""• _ „ . .x _�'�.(
Section .10(b) ;Rent and Other chargesePayable,.by I essee� evenue Sharing)
M`�4' o d^ ied ctoa.icrn•wsC3:o?..ia 1Y«�- ,-.tA�>hr'kYe".<=15. % c•,,,-';ta...:s`rte.`a'. r`°;-" nYa.r,"z;-'br�^�'a�rR: evenue Sh.�h,'•arn-"v:.gS^;..t�{;
to.v-�.„ch*,t arge
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lrOv dedAudioVisualsstemslinens flowers 'tablese- airs• =:fatarechina andthe ike
•
utretain:edthefexclusionfo,rtaxegratuitieand'charges for onsite
tabor.
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Section 5.1—Permitted Uses
Changed language from prohibiting "indecent uses" to prohibiting "obscene uses" per Larry
Warren.
Sectio*-$40:Ci&-Sponsored',E;
- '�e Trevenue�from-tle�Cit
Section 6.4(b)—Additions,Alterations,and Improvements
Included sentence for Lessee to reimburse Lessor for legal costs incurred by Lessor in
connection with defending itself against any claims for labor and material furnished to the
property.
Art'cle�9>.YA`�signment�4and'Sublefting
•
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tedtsed`Athcle:9,to.o�mituSection 9 2}[Les_see'.;.s assignnn�ent;(wxthou,Lessor; c,onsent)o to
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SOW s of ginal aift:lease;.
Article 13.1 Non-Discrimination
Added ""sexual orientation"and"mental or physical disability". Also added the phrase
"unless exempted by applicable state or federal legislation or judicial or quasi-judicial
decisions" at the end of the paragraph.
Added"sexual orientation"to the list of protected persons or groups of persons.
E l b t B,-P�ker Site Plai
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Added'anadditioal a e:with P:avilionBui din s uare foota edata:
Exhibit D-Buy-Out Schedule
Changed the header format,text and date.
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Spirit of Washington (SOW)
Overview of Original Proposal
• The Spirit of Washington Catering (SOW) proposed to
lease the entire Pavilion Building for a minimum of 3 years
with 12-months notice by the City to terminate the lease on
or after 3 years
• SOW would use its existing kitchen facility to cater to
events at the Pavilion Building.
• The building would function as an open hall with minimal
tenant improvements, paid for by SOW
• Space could be used for a variety of events, including
corporate meetings, weddings & parties, dances & school
events and community events
Spirit of Washington (SOW)
Overview of Original Proposal
• SOW proposed rent structure included a base rent (Year 1
- $15K, Year 2 - $30K and Years 3 or more - $36K), plus
35% of facility rental revenue and 15% of catering revenue
• SOW projected 130 events (or approximately 14,300
visitors) for first year with 5% annual growth thereafter
• Over the first 5 years, base rent to the City would be a
total of$153,000 ($3.19/sf, or an average of$30,600/year)
and total projected rent (including base rent and projected
percentage rent) would be $440,499 ($9.18/sf, or an
average of$88,100/year)
Proposed Lease Terms
• 10-year term with the ability for the City or SOW to
terminate with 12-months notice effective on or after 4
years with limitations described below
• SOW will have exclusive use of the facility for meeting
and event space, except for limited City use of the
facility and limited use of the Pavilion Building
restrooms for Piazza events as described below
■ SOW will pay for any tenant improvements. To date,
SOW plans to,install carpet, window coverings, a
lounge area & coat check and moveable planters with
trees
Base Rent & Revenue
Sharing
• Base Rent: First three months free. The next three
months are $1,000/mo. The next twelve months are
$2,000/mo. Thereafter, the base rent is $3,000/mo.
• Revenue Sharing:
• 35% of gross room rental charges and 15% of gross
catering sales (food and beverages)
• Excludes gratuities, taxes and all revenue from City
use of the facility or Piazza event use of restrooms
• Other potential revenues, such as labor, tables,
chairs, linens, flatware, china, etc. are excluded
unless SOW charges the same or more than market
rates, in which case City receives 15%
•
Projected City Revenue
(Years 1 -5)
ear One.Year Two Year,Ttiree>. ear:Four',Yearfit Curnulatit
Base Rent $15,000 . $30;000 . .::$36000 ;$36,000_. .$36;000 .. $153,000
(guaranteed,rent).
Revenue (projected rent)
Facility Rental $26;340 $27,392 , $28,762. . $30,200 .'.$31;710 $144404
Catering Revenue;; . $25,896 $27,191; $28,551• :`$29;979 :$31,478;' ;$143;095
_ . 83. $93,313` '!$96;179
TOTAL .`° $67,, ,5
236 ,, ; '.'$99;:188 . ,04499.
Revenue per sf $7.01 . $8:82 $9:73: •$10:02.: ::$1034 :`: .$918
(based on 9,595-sf open hall)
Maintenance & Utilities
■ SOW is responsible for maintenance & custodial work
for the Pavilion Building and for all Pavilion Building
utilities
■ City is responsible for all exterior damage, maintenance
and repairs to the Pavilion Building, unless caused by
SOW's use of the premise
• SOW is not responsible for maintenance or custodial
work related to the adjacent uses (Piazza park, public
parking lot, Transit Center or parking garage) unless
damage or extraordinary trash attributed to SOW
•
City Use of Building
• City may schedule up to 12 City-sponsored events per
year at Pavilion Building
• SOW to provide access & custodial services for a $250
base fee plus $35/hour per event. SOW has exclusive
right to provide all additional services (catering, tables,
chairs, etc.) to City at market rates
• Unless otherwise approved by SOW, City may not
schedule events on Friday evenings, Saturdays, Sundays
& holidays (except during Renton River Days and for the
Holiday Tree Lighting festivities)
Piazza Events - Use of
Restrooms
• City may schedule up to 36 events per year in the Piazza ,
Park (e.g., Renton Farmer's Market & Cinema on the
Piazza) where SOW wilt allow use of Pavilion Building
restrooms for a$50 fee per event
■ City will open, monitor, clean, restock and lock the Pavilion
Building restrooms for each such use _. • .
• SOW has the right to schedule other uses at the Pavilion
Building on said dates and to exclude Piazza event access
to the restrooms with 30 days notice to the City
• If conflict with a Pavilion Building event, Piazza events will
need to secure porta-potties
Piazza Park Use
• City retains right to schedule Piazza events at any
time. However, after annual schedule established,
City will attempt to coordinate additional dates with
SOW events at the Pavilion Building
• Pavilion Building users may occupy a portion of the
Piazza Park for incidental use (but not place tables,
tents, barricades, etc. that restrict public access to the
Piazza Park)
• For any other use, SOW or Pavilion Building users will
need to secure approval of Renton Park Board
Other Provisions
• SOW is responsible for providing liability insurance,
excluding City use of the Pavilion Building and use of the
Pavilion Building restroom for Piazza events
• City is responsible for providing property insurance at full
replacement value
• SOW is responsible for payment of the leasehold excise
tax, state business and occupation tax and sales tax
• SOW will provide a $3K security deposit to be placed into
an escrow account for potential damages to the facility
• City to provide SOW four spaces in adjacent public
parking lot
Lease Term Opt-Out
• After 3 years, City may terminate the lease for another
non-event use with 12-months notice (effective on or
later than the end of the 4th year of the lease).
• If SOW continually meets performance standards, City
may not terminate lease for another event use
• If SOW fails to meet performance standards, City may
terminate the lease with 12-months notice for another
event use (effective on or later than the end of the 4th
year of the lease). However, the City or the new tenant
must pay SOW the then-applicable buy-out to cover the
residual value of SOW's capital & start-up costs
•
SOW's Projected
Capital & Start-up Costs
' Non-AAoveable'Capital'Costs _:,".., ,' ,; :. :; •:.,. .
Carpet.:.i.:: ;c;i .:... $36;000
Window Coo.edngs'`
Lounge;Areawith:BarandCoffeeStation;-Coat'Cheak_:,• !'; • • $18,000
Planters Trees'with MovablePotsj.; `:; -•,"
Sub-Total':•i._:::,:,,;. :, .:
Moveable,:Capital Costs
• Table Top&Service,Wanikenis° • '• ".$31;334
Kitchen,Equipment diems. :,$16;242'
Other Equipment;: ; . >::: : "' .. .: $32124.7;
Sub-Total • •> • $79;824
pp-front Marketing Costs` .
Print Production&'Adiertising. < $59450.
Web,Developrhent
TV $25.000
Radio, &.Web Advertising $33,500
Otticesupplies&postage• : '$5000
Opening Gala ;$25,000
Sub-Total . . $158,650
Total(Estimate) $352,4.4
Performance Standards
Months 1 thru 12 No.performance measure
Months. 13 thru 2k: • No.performenoe`measure
Months:.25 thru 36' 11'0 Everits
Month :'37.thru 48120`Events
Months•?.49:thru.:60 .125'Events
Months 61 thru 72 130 Events
Months=.73 thru 84..... :135:Events
Months 185 thru 96 140.Events
Months''97 thru 108:°145;Events
Months 109 thru 120 150 Events
Buy-Out Provision
• Actual depreciation schedule for buy-out is still being
negotiated with SOW
• Current SOW proposal: Depreciate start-up marketing
costs over 6 years. Depreciate capital costs over 10
years, with a value of 40% remaining in year 10. After 10
years, a new operator (if SOW replaced) would get all
non-moveable capital costs and moveable capital costs
would be available for a then negotiated price, if desired
• Buy-out would be paid for by City or new event use tenant
(could be City or another entity)
■ Buy-out would not apply if terminated for another non-
event use
Next Steps
p
• Complete'negotiations with SOW and
finalize draft lease
• Present draft lease to Council for review
and approval
• Execute lease
,
Pavilion Building
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Dear Madam Mayor and President of Council,
My name is Gene Sens and;I have some serious concerns about the potential
lease arrangement being discussed for the Pavillion Building.
My role as President of Piazza Renton ( the non-profit group that helped
shape and create the Piazza),Manager of the Renton Farmer's Market and a
business and property owner in downtown Renton causes me to be
concerned about any business relationship or lease arrangement that does
not value activities and events in the Piazza .Many of us have been fighting
long and hard (and continue to )helping to revitalize downtown Renton
.These events such as The Farmer's Market ,Saturday Cinema , Tree
Lighting ,Harvest Festival , Jazz in the Piazza , Chalk Art etc...bring people
here that stay , spend money and enjoy what the Downtown has to offer.
Please help us by finding an appropriate tenant and lease agreement for the
Pavillion Building.
Sincerely,
Gene Sens
kvoItim 6Id co
5)9/9_005
From: "Eric Temple" <etemple@swdtrain.com>
To: "'Mark Santos-Johnson"' <Msantosjohnson@ci.renton.wa.us>,
<Jcovington@ci.renton.wa.us>
Date: Wed, May 4, 2005 11:24 AM
Subject: RE: Council Meeting-Pavilion Building
Jay, Mark, and Council
Please see the attached document, and let me know your thoughts.
Thanks,
Eric T.
Original Message
From: Mark Santos-Johnson [mailto:Msantosjohnson@ci.renton.wa.us]
Sent: Tuesday, May 03, 2005 1:00 PM
To: etemple@swdtrain.com
Cc:Alexander Pietsch; Jay Covington
Subject: Re: Council Meeting-Pavilion Building
Eric,
The most significant issue that we were unable to come to an
agreement
regarding was SOW's request for a non-compete provision (with or
without
a substantial City buy-out provision)for 10 years with no
minimum
performance standard and the City's unwillingness to agree to any
non-compete provision without a reasonable minimum performance
standard.
As such, SOW would like to retain exclusive rights for any
events-related use of the Pavilion Building for ten years,
regardless of
performance. Conversely,the City is only willing to provide SOW
with
exclusive rights if the facility is used for a minimum number of
events
peryear.
Although the above issue was the ultimate"deal breaker"in our
negotiations, it is not the only"sticking point"or outstanding
issue.
Other significant issues that need further negotiation and may
also be
deal breakers include:
1) Early-Termination (Opt-Out) Provision. SOW's request for 24
months
notice from the City, rather than 12 months for the City's early
termination provision may preclude the City's ability to consider
any •
other use of the Pavilion Building for the entire Lease Term.
2) City Buy-Out provision (as part of the SOW proposed
Non-Compete
provision). SOW's request for a substantial City buy-out
provision
(estimated at approximately$375,000 to $400,000) in order to use
the
Pavilion Building for another event-related use during the
proposed
10-year non-compete period only seems possible if SOW meets
minimum
performance standards (i.e., if the City wants to buy-out SOW to
use the
facility for another events-related use, even though SOW met the
performance standards).
3) Lease Term. Although the City has discussed a number of
possible
terms, the ability to go beyond 3 to 5 years was conditioned on
agreement of other parts of the lease(e.g., a reasonable
performance
standard).
4) Piazza events- use of the Pavilion Building restrooms. The
proposed fees are high and may be prohibitive for Piazza event
users,
resulting in a variety of challenges and potential problems for
users,
the City and possibly SOW.
5) Piazza park. As you know, the lease currently includes no
provisions regarding SOW's access to or use of the Piazza park
for
private events. However, SOW's request for private events to be
able to
rent part of the Piazza park(and for a more efficient approval
process)
are counter to current City and Parks Board policy and
operations.
Consequently, they may or may not be possible or desired.
Although there are other items to resolve in the lease,the above
items
seem to be the most significant at this time. Please let me know
if you
have any questions or wish to further discuss any of the above
issues.
Unless SOW elects at this time to modify the proposed lease to
resolve
the above items, staff is recommending that the City move on to
look at
other options for use of the Pavilion Building.
Thanks.
Mark Santos-Johnson
Economic Development Specialist
425-430-6584 (FAX 425-430-7300)
E-mail: msantosjohnson@ci.renton.wa.us
City of Renton web site: www.ci.renton.wa.us
Renton Community Marketing Campaign web site:
www.rentonmarket.com
>>>"Eric Temple" <etemple@swdtrain.com>5/2/2005 10:18:09 AM >>>
Mark,
I've been asked to show up next Monday, the 9th, to explain the
failure of our negotiations. I just want to make sure I
accurately understand why we're stuck, and what the City's
position is on the sticking point(s), so we don't have one of
those exchanges that makes it look like we don't really
understand what's going on.
The only sticking point I'm currently aware of is-the City is
unwilling to pursue any compensation for the SOW from a
replacement vendor, should the SOW somehow miss the target
numbers that guarantee automatic renewal as the lessor of the
events center.
Please let me know if this is an accurate characterization of the
City's position.
Thanks,
Eric T.
CC: <council@ci.renton.wa.us>
J e
Mark,
I'm relieved that I sent the email attempting to clarify our failure to get a deal done, as
your response doesn't clearly articulate our position on many issues.
1. Term- We are currently at 4 years,with an additional 6 years.
2. Performance Guarantee-Needs a sub list.
a. In year 4, we offered to pay market rent for the building, which you
rejected. This would of course do away with nearly every other issue the
City raises in this area listed below.
b. You proposed a"number of event"performance standard; with no
protection for us should we miss the numbers, which we rejected.
(i) We are OK with 130 events in year 6, as you proposed, we were
not OK with you not working with on next item, as part of the deal.
(ii) The city is unwilling to seek any compensation from a different
event company, should we miss the numbers.
(iii) When the initial term was 3 years, SOW's expectation for
compensation,from a 3rd party,was our start up costs plus some
additive. There has been a 4th year added,which lowers our
requirement.
(iv) The compensation does not come from the City.
(v) This provision only comes into play if we both miss the numbers,
and the City wants to replace us with a different event management
company. PF Changs gets the carpet for free.
3. Early Termination—Market rent solves this one too. We would like 24 months
from the City, but would like 12 months for ourselves. •
4. Piazza Events—Our rate is very fair
5. Piazza Park—Its not a deal breaker for us,but it makes sense for us to be able to
rent out a small portion of the park to accommodate events.
If you have any questions,please let me know. If not,we'll see you Monday night.
Thanks,
Eric T.
March 7,2005 Renton City Council Minutes = Page 73
* The stairs at Gene Coulon Memorial Beach Park that lead from Kidd
Valley to Ivar's are being replaced due to a fairly significant understructure
problem. The stairwell will be closed for up to one month and the area has
been posted with alternative routes.
* The Draft Watershed Habitat Plan will be released on March 10th. The
public comment period begins that day and concludes on April 25th. A
public meeting on the plan is scheduled on March 22nd at Renton City
Hall. Hard copies will be available for review at city halls and libraries,
and the document will be available via the Internet at www.metrokc.gov.
AUDIENCE COMMENT Rosemary Grassi,PO Box 1188,Renton,98057, stated that the speed and
- Citizen Comment: Grassi- volume of traffic along Cedar Ave. S. is unacceptable, and she expressed her
Cedar Ave S Speeding Traffic concern regarding the safety of the children. She made the following
suggestions: install two traffic signs that state "no through traffic" -one on S.
7th St. and one at the bottom of Cedar Ave. S.; install a traffic circle;reconsider
installing a speed bump; and install a crosswalk at the bottom of Cedar Ave. S.
Mayor Keolker-Wheeler stated that staff is working with the community
associations in the Renton Hill area in regards to this issue.
Citizen Comment: Temple- Eric Temple,President, Spirit of Washington Dinner Train,PO Box 835,
Pavilion Building Lease, Spirit Renton, 98057,thanked Council for its decision to move forward with
of Washington Dinner Train negotiations with the Spirit of Washington Dinner Train to utilize the Pavilion
Building as an event center. Mr. Temple stated that he has spoken with a
number of meeting event and wedding planners, and has tentatively booked
nine events.
CONSENT'AGENDA Items on the consent agenda are adopted by one motion whicli follows the
listing.
Council Meeting Minutes of Approval of Council meeting minutes of February 28,2005. Council concur.
February 28, 2005
Vacation: N 14th St,Pool City Clerk submitted petition for vacation of portion of N. 14th St.,east of Lake
Brothers Construction,VAC- Washington Blvd. and Gene Coulon Memorial Beach Park; petitioner Pool
05-001 Brothers Construction,LLC,PO Box 3023,Renton, 98056(VAC-05-001).
Refer to Planning/Building/Public Works Administrator; set public hearing on
4/4/2005 to consider the petition. (See page 74 for resolution setting the public
hearing.)
Lease: Engenio Information Community Services Department recommended approval of an amendment to
Technologies, 200 Mill Bldg the lease with Engenio Information Technologies,Inc. (LAG-00-002)for the
(3rd Floor),LAG-00-002 3rd floor of the 200 Mill Building to extend the lease for an additional year.
Refer to Finance Committee.
Utility: Edmonds Ave NE Utilities Systems Division recommended approval of an agreement with
Outfall Replacement,Entranco Entranco, Inc.in the amount of$61,724.44 for the design of the Edmonds Ave.
NE Outfall Replacement Project as part of the May Creek Basin Slope
Stabilization Program. Council concur.
Streets: Sunset Blvd N,NE Utilities Systems Division recommended the temporary lane closures of Sunset
Sunset Blvd&Houser Way Blvd. N. and NE Sunset Blvd. and the temporary full closure of the Houser
Tunnel Closures Way Tunnel and Sunset Blvd.NE for the installation of a new sanitary sewer.
Closures are to take place from March through November,2005, with exact
dates dependent on work progress. Refer to Transportation(Aviation)
Committee.
February 14,2005 Renton City Council Minutes - Page 52
MOVED BY BRIERE, SECONDED BY CLAWSON, COUNCIL APPROVE
THE CONSENT AGENDA AS PRESENTED. CARRIED.
UNFINISHED BUSINESS Council President Briere presented a Committee of the Whole report regarding
Committee of the Whole the Pavilion Building lease. The Committee recommended moving forward
Community Services: Pavilion with negotiations with the Spirit of Washington Dinner Train to utilize the
Building Lease Pavilion Building as an event center. Staff will work with the Spirit of
ashington Dinner Train to bring a proposal back for consideration. MOVED
BY BRIERE, SECONDED BY LAW, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Planning & Development Planning and Development Committee Chair Clawson presented a report
Committee regarding the boundary expansion for the proposed Mosier II Annexation. A
Annexation: Mosier II, 142nd public hearing on the Mosier II Annexation was held on 2/7/2005, after which
Ave SE& 144th Ave SE, Council authorized staff to invoke jurisdiction at the Boundary Review Board
Boundary Expansion to request expansion of the annexation area to more reasonable boundaries.
The Committee,therefore,recommended that the referral regarding the Mosier
II Annexation boundary expansion be closed. MOVED BY CLAWSON,
SECONDED BY LAW, COUNCIL CONCUR IN THE COMMITTEE
REPORT. CARRIED.
Community Services Community Services Committee Chair Nelson presented.a report
Committee recommending concurrence in the staff recommendation to approve a contract
Community Services: City . with Richard C.Elliott, in the amount of$45,894.11, for his proposed work of
Center Parking Garage art at the City Center Parking garage, and to approve the total project budget of
Artwork,Richard C Elliott $52,774.11. The Committee further recommended that the Mayor and City
Clerk be authorized to sign the contract with Richard C.Elliott. MOVED BY
NELSON, SECONDED BY PALMER, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Councilwoman Nelson stated that the artwork will be a beautiful addition to the
parking garage, and it should be completed in approximately one year.
Finance Committee Finance Committee Chair Persson presented a report recommending approval
Finance: Vouchers of Claim Vouchers 234347 -234897 and two wire transfers totaling
$3,718,131.47; and approval of Payroll Vouchers 55668 -55892, one wire
transfer, and 572 direct deposits totaling$1,821,258.51. MOVED BY
PERSSON,SECONDED BY LAW, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Finance: Utility Outstanding Finance Committee Chair Persson presented a report recommending
Balance Search Fees &Special concurrence in the staff recommendation to implement service fees for special
Water Meter Read Service meter read,new utility account set up, and name change services. The
Fees Committee also recommended concurrence in the staff recommendation to
implement special service fees for utility outstanding balance searches.
The Committee further'recommended that the ordinances regarding these
matters be presented for first reading.*
Councilman Persson explained that title and escrow companies request utility
outstanding balances from the City at the close of property sales,and a fee is
proposed for providing this service. He noted that the Committee
recommended increasing the staff-recommended fee from$10 to$25 for an
Internet water utility balance search, and from$30 to$50 for a search requested
by fax,messenger, or letter.
APPPOIFED BY 1
CETT"C31.92+SCiL
COMMITTEE OF THE WHOLE
• COMMITTEE REPORT Date 62-/V-1?°°•5".
February 14,2005
PAVILION BUILDING LEASE
Referred January 3, 2005
The Committee recommends moving forward with negotiations with the Spirit of Washington Dinner
Train to Utilize the Pavilion Building for an event center. Staff will work with the Dinner Train to bring a
proposal back for consideration.
Terri Briere, ity Council President
cc: Alex Pietsch,EDNSP Administrator"
' •
C•• •"
•,
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RtiVk I t 01 (Mil 211
.■' // RECEIVED
Ewa, FEB 0 9 2005
DALLY PROPERTIES Renton City Council
L L C
{ "Exceptional Quality-Timeless Value"
February 7,2005 CITY OF RENON
Councilman Dennis Law FEB .1 0 2005
City of Renton
1055 South Grady Way
Renton,WA. 98055RECEIVED.
CITY CLERK'S OFFICE
Dear Dennis:
I appreciate you taking the time to speak with me on the phone last week.As you know I am very
concerned about what type of tenant the City is able to attract for the Pavilion Building. The City
and the majority of the businesses downtown need an anchor type tenant that will generate a lot
of traffic during the afternoon and evening hours to vitalize and energize the downtown core. This
will"feed on itself'and growth will result in new retail businesses, offices and new high-density
multi-family. - �
Besides the lease up of the Pavilion Building to a high traffic anchor tenant, I see two(2)other
aspects of development that must occur to get the downtown core back on track to economic
revitalization.First,Alex Pietsch and several members of the Council must sit down with Alex
Cugini and pursued him to work with the Real Estate community,now to either sell or
redeveloped his McLendons site with a quality anchor type tenant.If he just collects rent for the
next 3-5 years from a McLendons class B or C sub-lease tenant the downtown core will be hurt.
Second,the City must do every thing possible to encourage more multi-family development in
the downtown core.I believe there are four projects all within a block and a half of the bus
transfer station that are in for permit.These projects comprise of about 400 units;this would add
a lot of"buying power"to attract retail.
Alex Pietsch has worked extremely hard in marketing the Pavilion Building,I know because I
have bugged him nearly weekly. Alex has all the local connections but not the national ones.I
would suggest because of the now expanding economy that the City interview three of the major
national Commercial Real Estate companies to have one of then market the Pavilion Building to
national firms.
As I said in our phone call,I will be out of town on February 14,you can read this letter at the
Council meeting if you deem it appropriate.
Sincerely: : . - •
a 'operties,:LLC
.. •.ally ;
cc: Alex Pietsch
3316 FUHRMAN AVE.E.■ SUITE 100• SEATTLE,WA 98102• (206)328-3770• FAX 328-6909
�,'� recycled paper
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1,
- CEIVED coos
Monday,February 14,2005 12:31 F Darrell Vange 206 223 1551
p,01
�A , FEB 14 2005
Renton City Council
INTERNATIONAL MUSEUM OF CAROUSEL AR.T
CITY OF RENTON
February 8, 2005 FEB 1 2005
RECEIVED
Mr.Alex Peitsch, Administrator CITY CLERK'S OFFICE
Economic Development,
Neighborhoods and Strategic Planning
Renton City Hall
1066 South Grady Way
Renton,WA 98055
Dear Alex:
Thank you for the invitation to the City Council working session on February 14a'.
Carol and I regret that we cannot attend, but we look forward to the Council's
direction regarding the Pavilion building and the prospect of locating our carousel
museum there.
We remain very committed to this project as it represents one of our most
important goals: to place the best elements of our collection in a first-class
museum facility in a major metropolitan area. Except for the small facility we
have in Hood River, and the periodic traveling museum exhibit, we have not had
the opportunity to present our collection in the manner it deserve°.
While we have not made a formal offer, the business plan prepared by
Ravenhurst is a detailed projection of the museum's potential. We appreciate the
City's support in preparing this document, and we worked closely with Darrell
Vange to compile it. You have also received a discussion document with very
- specific lease terms, Wo have reviewed these carefully, and we would propose
this document as a reasonable starting point for negotiating a lease,
We are making a very significant commitment to this venture. We propose to
provide nearly four million dollars worth of carousels, horses and historic artifacts
for this museum, as well as making an additional capital investment in the
museum of.over$100,000.00. We also propose to go out and secure$200,000
in sponsorship funds. We intend to underwrite any operating shortfalls in the
initial years, and in addition to hiring professional staff.we expect to spend most
of our time in the next two or three years getting the museum on its feet.
The biggest challenge will be marketing the museum. There is a long lead time
for many of the advertising channels we use, and it will take time to build
attendance. It is almost too late to achieve a summer opening, but we want to
start working as soon as we can. To this end, we will commit to identifying and
hiring the executive director as soon as an agreement is signed with the City.
We are already searching, and we have one or two candidates lined up. We
Monday, February 14,2005 12'31 PM Darrell Vange 206 2231581 p.02
INTERNATIONAL MUSEUM OF CAROUSEL ART
Mr. Alex Pietsch
Page 2.
have also been approached by Individuals that want to volunteer In our carving
and restoration area, and to work as docents in the museum.
The executive director will manage the facility day today, but they will also be the
liaison to the community and to City government. As with any non-profit,their
primary responsibility will be to attract sponsors, develop membership end build
attendance. Our candidates will come from either the marketing staff of local •
cultural non-profits, or will be national carousel promoters.
We are also willing to create a small local advisory board, in addition to the Board
of Directors of IMCA which are already in place. This group could include a
Puget Sound museum executive, a Chamber of Commerce representative, one
or two prominent local business owners, educator or business experts. Their job
would be to open doors, to ensure we are fully using the local resources, and to
make sure we are responsive to the Renton community.
We want to focus on the museum operations, but the facility has great potential
- __for banquets and_special events. If selected, we want to enter-into a relationship ----
with a local caterer and event organizer to build that part of the business. We
• think the Spirit of Washington organization may be ideally-suited for this role, and
we welcome an opportunity to discuss this with them. Pending the decision by
the Council, they were not ready to discuss this with us up to now.
Although we cannot be at the February 14th meeting,we would be more than
_ - happy to Interview with Council members,or answer any questions they.might
have. This is a great opportunity for us both, and we would not want the chance
to go by for lack of information or exposure. We feel we have provided a lot of
information already, but the real work comes after you decide the carousel
museum is your preferred choice.
We eagerly await the Council's decisions.
Sincer: . .
Duane Perron
Chairman
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Pavilion Building
Vision
■ "(The Pavilion Building) will serve as a
focal point of activity in Downtown
Renton"
■ "The Pavilion will be a lantern leading
people to Downtown Renton "
Pavilion Building dedication
December 2003
Pavilion Building
Marketing Efforts
■ Renovation completed April 2004
■ Targeted primarily "anchor" restaurants or
other retail uses
■ Goal - Draw people to downtown Renton
and generate energy in the area
Pavilion Building
Potential Tenants Contacted
EDNSP contacted 124 potential tenants :
■ 71 restaurants/brew pubs & 8
developers
■ 17 grocery/food entities , 1 drug store
& 5 bookstores
■ 15 music/arts/entertainment/
recreation entities , 4 furniture stores
& 3 "event" uses
Pavilion Building
Proposals from Potential Tenants
• "National Fitness Center"
• Shelby's Restaurant and Ice Creamery
& Shelby's Meeting and Banquet Facility
• International Museum of Carousel Art
• Old Spaghetti Factory
• Spirit of Washington Dinner Train
Pavilion Building
Status of Proposals
• "National Fitness Center" — Council
decided not a desired use for the
facility at that time (9/2004)
• "Shelby's" - withdrew proposal based
on anticipated impacts from Lakeshore
Landing project ( 10/2004)
• Old Spaghetti Factory — withdrew
proposal due to limited vehicular and
pedestrian activity downtown ( 1 /2005)
Pavilion Building
Current Options
• International Museum of Carousel Art
( IMCA) - Carousel Museum
• Spirit of Washington - banquet!
meeting/event space
• Other
Overview of Potential
Carousel Museum
■ IMCA proposes to lease the entire Pavilion
Building for 10 years with options for 20
more years with a three-year performance-
based kick-out clause
■ Building to include both a museum and a
carousel
■ The building could also be used for
banquet/meeting/event space as a
secondary use
Potential Deal Structure
for Carousel Museum
Proposed rent structure based on a tiered
percentage of the annual gross income (AGI) :
.Beginning with no rent for the first $100K of AGI
.15% rent on the next $100K of AGI
.20% rent on the next $100K of AGI
.25% rent on anything over $300K of AGI
Over the first five years, projected average rent for
the carousel museum would range from $83K to
$ 108K per year ($8.65/sf to $11 .26/sf)
. .
Potential Building Layout
for Carousel Museum
•
, .
.criNcESSION
CFFIGE
pASS
AlEovE
THRouG1-1
f-sk71
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REST- •I-.• -., # ., 6, GIFT .
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IT EXHIBITS i 1 F.4-11IBITS• ! I i
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PARTY PARTY
AREA 2 AREA I
RENTON CAROUSEL CENTER
MUSEUM'EX.14I5IT sLAYOUT
'RrNTON LU&
1/4/05
• •
INTERgATIONAL MUSEUM OF CAROUSEL.ART
54I 3s71 44.22
0 4 ti 14 24
•
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Potential Banquet Layout
for Carousel Museum
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INTERNATIONAL MUSEUM OP CAROUSEL ART
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Carousel Museum
Pros
■ Operator has the "largest, collection of carousels &
carousel art in the world"
■ Unique opportunity for a public-oriented use that has
the potential to draw people to downtown Renton from
throughout the region & beyond — project 100K to
150K visitors per year
■ The venue will also be marketed for banquets/
meetings/events as a secondary use
■ Builds on Renton's craftsman history and adds to the
arts, entertainment & collectibles theme in downtown
Renton
Carousel Museum
Cons
■ Unknown how many people will come & pay to visit the
museum as a "stand-alone" venue in downtown Renton
■ May not represent the optimal use envisioned for a
revitalized downtown Renton
■ Non-profit operator has limited resources and
organizational capacity; may require time and/or City
assistance to help offset
■ City may need to pay up to $300K for initial capital
budget, including tenant improvements & other pre-
opening costs
Overview oil Spirit oT
Washington Proposal
■ The Spirit of Washington proposes to lease the entire
Pavilion Building for a minimum three-year period with
additional year-to-year terms and a 12-month kick-out
clause
• The Spirit of Washington would use its existing kitchen
facility to cater to events at the Pavilion Building
• The building would function as an open hall and tenant
improvements would be minimal
• Space could be used for a variety of events, including
corporate meetings, weddings & parties, dances & school
events and community events
Potential Deal Structure
for Spirit of Washington
Proposed rent structure based on annual rent
(Year 1 - $15K, Year 2 $3OKandYears 3 or
more - $36K) , plus 35% of facility rental revenue
and 15% of catering revenue
Over the first five years, projected average
compensation to the City would be $88K per year
Spirit of Washington
Pros
■ Spirit of Washington Dinner Train has operated in
Renton since 1992, bringing more than 1 .2 million
visitors to downtown Renton
■ Spirit of Washington Catering has operated in Renton
since 1999 to provide in-house food for the Dinner
Train and full-service, off-site catering
■ Project 130 events in year one bringing 14,300 visitors
to downtown Renton, with 5% growth each year
■ Provides a viable use for the building until the
downtown market develops further and/or the City
identifies another desired use for the facility
Spirit of Washington
Cons
■ The Pavilion Building would be vacant as much as 65%
of the year (e.g., an average of four days a week)
■ The 130 events are projected to attract an average of 110
people each — not a major draw for a 10K+ sf building
■ Many of the events at the Pavilion Building would be
"private" and not available to the general public
■ The facility may take away existing business/revenue
from the Renton Community Center & Renton Senior
Center banquet/meeting/special event uses
■ The building may require some tenant improvements to
support the use (e.g. , floor coverings)
Banquet/Meeting/Event
Space - Options
■ Negotiate a contract with the Spirit of
Washington
■ Contact other special event related
businesses that have expressed an interest
in the facility in the past to explore their
current interest
■ Conduct an RFP to secure a banquet/
meeting/event vendor with the best deal for
the City
Other Options
■ List the property with a commercial broker
■ Revisit the "national fitness center"
prospect
■ Proceed with a market study & business
plan for a farmer's market with an
anticipated long-term City subsidy
■ Explore other civic uses
Next Steps
■ Council provide direction on preferred use
tonight
■ Council provide parameters for deal
(i .e. , lease term , tenant improvement ceiling
& rent range)
■ Staff negotiate lease/contract for Council
approval
■ Council review and approve lease
O� ♦ �O
� z
January 24,2005 Renton City Council Minutes Page 29
CAG: 03-158,Lind Ave Transportation Systems Division submitted CAG-03-158,Lind Ave. SW and
SW/SW 7th St Signalization, SW 7th St. Signalization; and requested approval of the project, authorization
Totem Electric for final pay estimate in the amount of$160, commencement of 60-day lien
period, and release of retained amount of$9,596.62 to Totem Electric,
contractor, if all required releases are obtained. Council concur.
CAG: 03-160,2005 Local Utility Systems Division recommended approval of Amendment No. 2 to CAG-
Hazardous Waste Management 03-160, King County-Suburban City contract, accepting$22,903.46 for
Program,King County Grant Renton's 2005 Local Hazardous Waste Management Program. Council concur.
(See page 31 for resolution.)
Utility: Water System Plan, Utility Systems Division recommended approval of the 2005 update to the
2005 Update City's Water System Plan. Refer to Utilities Committee.
Utility: Annual Consultant Utility Systems Division recommended approval of the annual consultant roster
Roster for Telemetry & for telemetry and supervisory control and data acquisition (SCADA) consultant
SCADA Services services. The roster contains the following consultants: Casne Engineering,
Inc.,Reid Instruments,RH2 Engineering,Inc., and Summit Engineering and
Consulting,PS. Council concur.
MOVED BY BRIERE, SECONDED BY PERSSON, COUNCIL APPROVE
THE CONSENT AGENDA AS PRESENTED. CARRIED.
CORRESPONDENCE A letter was read from Ramon Lucio,2020 Grant Ave. S.,#L-301,Renton,
Citizen Comment: Lucio- 98055, suggesting that the Pavilion Building be used for a public market
Pavilion Building,Public consisting of small stalls for different businesses such as fast food, services,
Market and dry good retailing. MOVED BY CLAWSON, SECONDED BY PALMER,
COUNCIL REFER THIS CORRESPONDENCE TO COMMITTEE OF THE
WHOLE CARRIED.
Citizen Comment: Various- At the request of Councilmember Clawson, City Attorney Warren commented
Sunset Bluff Preliminary Plat on the timing of letters received(from Daniel G. Rosefeld;Diane Johnson;
Appeal, SR 900 LLC& Tricia Allen; and David S. Mann, Gendler&Mann,LLP)regarding the Sunset
Herons Forever,PP-04-002 Bluff Preliminary Plat appeal. He indicated that the submission deadline of
1/17/2005 for these letters was not met; however, mail was not delivered that
day due to the holiday.
Mr.Warren suggested referral of the letters to the Planning and Development
Committee,pointing out that a determination on their admissibility can be made
in the future following further review by the City Attorney's Office and
arguments by the appellants.
MOVED BY CLAWSON, SECONDED BY PALMER, COUNCIL REFER
THESE LETTERS TO THE PLANNING AND DEVELOPMENT
COMMITTEE. CARRIED.
UNFINISHED BUSINESS Finance Committee Chair Persson presented a report recommending approval
Finance Committee of Claim Vouchers 234009 -234346 and three wire transfers totaling
Finance: Vouchers $3,126,472.97; and approval of Payroll Vouchers 55314-55667, one wire
transfer, and 566 direct deposits totaling$2,114,237.24. MOVED BY
PERSSON, SECONDED BY NELSON, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
.lez/eit C.o. W
CITY OF R NTON
Pev'ssaP
JAN i 4 2005 January 10,2005 To Mr. Don temulaa—Council President City of Renton
Dear Sir, I would like to make a suggestion on the Pavilion building in
ECEI'JFC owntown Renton. Myproposal is a Public Marketpattern like the QuincyPublic
CITY Cl.!✓I�I�5 OFFICEd P P
Market in Boston MA. They have small stalls for different businesses like fast
taw foods, services and dry good retailing. We can have international food outlets to
attract more people to worldwide cuisine for a cheaper prices. A lot of people
wants to go in business but the cost of rentals is too much. It would be like Pike
Place Market but in one single dome with easy access in and out. Maybe one
section could be an elevated stage for some presentation like singers, band,
karaoke etc.So many things can be done inside a public market to attract people
or to make it like a tourist attraction. The problems for this kind of plan is the
plumbing and electrical for the fast food section together with exhaust and
ventilations. A good kitchen contractor will know how to create an effective and
cheapest Way that the Public Health will approve. If the city don't want any
hassle on these problems, an indoor flea market could be feasible since it is
always raining here.
Cheaper daily,weekly or mothly rent on small spaces is a big help for
people trying to make;'a buck. Thank you very much for your attention on
this matter, Sincerely, Ramon Lucio ps my phone number is 425
227 8166 #L �p
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CITY, -)F RENTON t.
" City Clerk
Kathy Keolker-Wheeler, Mayor Bonnie I.Walton
January 25, 2005
Ramon Lucio
2020 Grant Ave. S.,#L-301
Renton,WA 98055
Re: Pavilion Building Use
Dear Mr. Lucio:
At the regular Council meeting of January 24, 2005,the.Renton City Council referred
your letter regarding pavilion building use to the Committee of the Whole for review and
recommendation. You will be notified of the time and date of the committee meeting by
the Council liaison when this item is scheduled.
If I can provide additional information or assistance,please feel free to contact me.
Sincerely,
Bonnie I.Walton
City Clerk
cc: Mayor Kathy Keolker-Wheeler •
Council President Terri Briere
Alex Pietsch,EDNSP Administrator
1055 South Grady Way-Renton,Washington 98055-(425)430-6510/FAX(425)430-6516 E N T ® lei
�� AHEAD OF THE CURVE
�^ This paper contains 50%recycled material.30%post consumer
/anuary 3,2005 Renton City Council Minutes Page 5
Council Meeting Minutes of Approval of Council meeting minutes of December 20,2004. Council concur
December 20, 2004 as corrected.*
Vacation: Logan &Park Ayes City Clerk reported City of Renton request for street vacation for portions of
N, City of Renton,VAC-04- Logan and Park Avenues N. for the proposed Lakeshore Landing site
005 development, and requested a public hearing be set of 1/24/2005 to consider the
request(VAC-04-005). Council concur. (See page 6 for resolution.)
Plat: Emmas,Lyons Ave NE, Development Services Division recommended approval, with conditions, of the
FP-04-138 Emma's Final Plat; ten single-family lots on 4.3 acres located at the 100 block
of Lyons Ave.NE(FP-04-138). Council concur. (See page 6 for resolution.)
CAG: 04-052, Sunset Sewer Utility Systems Division recommended approval of Addendum No. 1 to CAG-
Interceptor Phase III Design, 04-052,contract with Roth Hill Engineering Partners,LLC, in the amount of
Roth Hill Engineering Partners $90,550 for final design services for the Sunset Sewer Interceptor Phase III
Project. Council concur.
*MOVED BY BRIERE, SECONDED BY NELSON, COUNCIL APPROVE
THE CONSENT AGENDA AS AMENDED TO CORRECT THE 12/20/2004
COUNCIL MEETING MINUTES AS FOLLOWS: PAGE 459,UTILITIES
COMMITTEE REPORT,LINE 1,REPLACE "CHAIR CLAWSON" WITH
"VICE CHAIR BRIERE,"AND LINE 13,REPLACE "CLAWSON" WITH
"BRIERE." CARRIED.
CORRESPONDENCE A letter was read from Jean Rollins, 9605 143rd Ave. SE,Renton,98059,
Citizen Comment: Rollins - requesting that the City prohibit the transfer of development density credits
Development Density Credits, between real estate parcels within the Urban Separators. MOVED BY
Urban Separators CLAWSON, SECONDED BY BRIERE, COUNCIL REFER THIS
CORRESPONDENCE TO THE PLANNING AND DEVELOPMENT
COMMITTEE. CARRIED.
Citizen Comment: Temple- A letter was read from Eric Temple,President, Spirit of Washington Dinner
Pavilion Building Lease, Spirit Train,PO Box 835,Renton, 98057, expressing interest in leasing the Pavilion
of Washington Dinner Train Building for use as a venue for meetings and events. MOVED BY
10.\\IDA CLAWSON, SECONDED BY PERSSON, COUNCIL REFER THIS
CORRESPONDENCE TO COMMITTEE OF THE WHOLE. CARRIED.
Citizen Comment: Highlands Responding to Council inquiry regarding information received from Highlands
Community Association- Community Association Directors Robert McDaniel and Terry Persson,PO
Vacant House at NE 10th Pl, Box 2041,Renton,98059,concerning the neglected vacant house located at
Code Compliance 4307 NE 10th P1.,Mayor Keolker-Wheeler stated that the City declared the
house an attractive nuisance today. She described the timeline by which the
property owner has to secure the structure and submit a certified structural
engineer's assessment that states the house is safe. If the assessment is not
submitted, the property owner is required to apply for a permit to demolish the
house.
Councilman Clawson assured that the City's code compliance officers are active
in enforcing code compliance issues, and he pointed out that the hiring of
another code enforcement officer has been authorized.
Citizen Comment: McDaniel- Councilman Persson reported receipt of correspondence from Robert
Nuisance Abatement, City of McDaniel,4308 NE 10th Pl.,Renton, 98059, containing information about the
Bellevue City of Bellevue's nuisance abatement program.
teeb/&Gv
CITY OF RENTON
IRIT WASHINGTON
C DINNER TRAINS 2 DEC 2 9 2004
December 22,2004
RECEIVED
CITY CLERK'S OFFICE
Mayor Kathy Keolker-Wheeler
Renton City Council Et .�
City of RentonG
1055 S. Grady Way
Renton,WA 98055
Madam Mayor and City Council:
As many of you know,the Spirit of Washington Dinner Train has been interested in entering into
an agreement with the City of Renton,to operate the Pavilion Building as a venue for meeting and events.
Our experience in catering, event planning, and property management (we manage over 8,000 acres,
including property with tenants),make us an excellent candidate for this use.
Some members of the Council have asked me to reiterate my interest in this property, so let me
first say emphatically, we are still very interested. I was also asked to briefly outline our vision of this
agreement, and am happy to do so.
Our goal would be to maximize the positive community impact of this facility by creating the best
South End meeting and event venue; We envision uses such as:
• Community Events Haunted House,Easter Egg Hunts,and Wine Tasting
• Educational Events L Seminars,Lectures,and Cooking Classes
• Charity Events—Fundraising for Schools and other Local Charities
• Public Education—Displays Chronicling the History of Renton
• Business Events—Job Fairs and Training Seminars
• Special Events—Weddings and Celebrations
The benefits to the City of Renton include:
• We would pay monthly rent
• We would assume the utilities and other operating expenses for the building
• We would share the revenue received from our activities
• There would be no"out of pocket"expenses for the City for TI or marketing
• Increased visibility and a resulting positive regional impact for downtown
• We would be willing to discuss other retailers setting up in the building
• We would require a relatively short lease term, thereby freeing up the"space for future
development plans
As you work towards finalizing the City's plans for the future of the Pavilion, I hope this
information helps clarify our goals for this property. I would appreciate meeting with any or all of you,to
answer any additional questions you may have.
Sincerely yours,
•
Eric Temple 3 AAgit' .
President, Spirit of Washington Inc
P.O.BOX 835 • RENTON,WASHINGTON • 98057
BUSINESS(425)277-8408 • RESERVATIONS(425)227-7245 or 1-800-876-RAIL • FAX(425)277-8839
www.SpiritofWashingtonDinnerTrain.com
)04 '19v4 , •
CITY OF RENTON
DEC 0 9 2004
CITY OF RENTON RECEIVED
ECONOMIC DEVELOPMENT, NEIGHBORHOODS, CITY CLERK'S OFFICE
AND STRATEGIC PLANNING DEPARTMENT
MEMORANDUM
DATE: December 7, 2004
TO: Don Persson, Council President
Members of the Renton City Council/
vvv
VIA: Mayo Kathy Keolker-Wheelerl
���,p
FROM: Alex Pietsch, Administrator Aw
Economic Development, Neighborhoods,
and Strategic Planning Department
SUBJECT: POTENTIAL CAROUSEL MUSEUM AT THE PAVILION
BUILDING
ISSUE
EDNSP has been marketing the Pavilion Building since April 2004 to potential tenants, focusing on
uses that would draw people to downtown Renton and generate energy in the area. As part of the
department's efforts to explore potential uses for the facility, the City engaged Darrell Vange at
Ravenhurst Development Inc. to prepare a conceptual business plan for locating and operating a
carousel museum at the Pavilion Building. Mr. Vange's report outlines a proposal for the
International Museum of Carousel Art (IMCA) to establish and operate a carousel museum
(including an operating historic carousel) at the Pavilion Building. As outlined below, the
Administration plans to negotiate a lease with representatives of the IMCA to use the Pavilion
Building for a carousel museum. The lease will be subject to review and approval by the City
Council. If the City can come to an agreement with the IMCA, the goal would be to have the
carousel museum open at the Pavilion Building by summer 2005.
BACKGROUND SUMMARY
Potential Users
EDNSP has been working since April 2004 (when renovation was completed on the building) to
identify and contact potential tenants to lease space in the Pavilion Building. Staff focused
primarily on "anchor" restaurants or other retail uses for the facility (i.e., those that could use 40%
or more of the space) rather than spend time on smaller tenants. The intent was to secure an
anchor restaurant or other retail use that would draw people to downtown Renton and generate
December 7, 2004
Page 2
energy in the area. Any remaining space at the Pavilion Building could then be marketed to
compatible smaller tenants.
During the last eight months, EDNSP has contacted 123 potential tenants (see attached "Potential
Anchor Tenant Targets" list), including eight developers, 71 restaurants/brew pubs, 17
grocery/food entities, five bookstores, one drug store, 14 music/arts/entertainment/recreation
entities, four furniture stores and three "event" uses. Staff has provided tours of the renovated
building and worked with prospects to determine if the Pavilion Building was appropriate for their
use. If the Pavilion Building facility, location or market did not meet their needs, staff provided
information about other opportunities in Renton— including, for example, other buildings
downtown or the proposed retail development at Lakeshore Landing.
Proposals
Although several dozen businesses expressed an interest in either the Pavilion Building or other
opportunities in Renton, EDNSP has received only three formal offers for use of the Pavilion
Building to date:
• An August 24, 2004 letter of interest from a "national fitness center"
• An October 29, 2004 proposal from Shelby Varden for "Shelby's Restaurant and Ice
Creamery & Shelby's Meeting and Banquet Facility"
• A proposal from the International Museum of Carousel Art for a carousel museum
Council members considered the national fitness center proposal earlier this fall and decided that it
was not a desired use for the facility. The fitness center's agent subsequently indicated that the
company would prefer a 25,000 to 30,000 square foot space, so EDNSP staff referred them to the
McLendon's family to explore potential reuse of the current McLendon's Hardware store
downtown.
Shelby Varden, a Renton resident, has been working earnestly with EDNSP staff since July 2004 to
develop his concept and proposed use of the Pavilion Building for Shelby's Restaurant and Ice
Creamery & Shelby's Meeting and Banquet Facility ("Shelby's Concepts"). Although he submitted
a detailed proposal on October 29, 2004, he recently withdrew his proposal after learning more
about the proposed retail development at Lakeshore Landing and evaluating the projected impacts
of the development on downtown Renton and his proposed use of the Pavilion Building. (Please
see the attached November 11, 2004 e-mail from Mr. Varden for more information.)
EDNSP staff continues to explore potential uses of the Pavilion Building with other prospects.
However none of the other entities have elected to proceed with a letter of interest or submit a
proposal to date. Although staff has attempted to provide very flexible terms to encourage interest
in the facility, none of the prospects have turned down the space due to cost issues. If the City did
receive additional proposals for retail use of the building, EDNSP staff anticipates based on the
feedback received from many prospects that the City would likely be asked to provide "below-
market" rent and significant City-paid tenant improvements for the space.
r
I
December 7, 2004
Page 3
Spirit of Washington Dinner Train Event Facility
Staff has also had discussion with the owners of the Spirit of Washington Dinner Train about using
the building as a private event space. Staff met with Eric Temple alone and with the Mayor on
several occasions. Through discussions with him, staff has gathered a basic understanding of his
concept and a potential deal structure.
The Dinner Train would manage, market and operate the entire Pavilion.Building as event space. It .
could be used for a wide variety of events, including weddings, corporate meetings and parties, as
well as community events such as the Chamber of Commerce Holiday Auction or Rotary Caper.
. _ The.Dinner Train would use its existing catering operation at the Train Depot to provide food
service to the building. The building would function as an open hall and tenant improvements
would be minimal. Mr. Temple indicated that, at a minimum, he would consider a three-year lease
with additional year-to-year terms and a 12-month kick out clause. He would consider some base
rent with the City receiving an additional percentage of their gross receipts.
The number of events that the facility would host is unclear and will depend on the demand and
success of marketing efforts, although Mr. Temple indicates that he would need to have
approximately 130 to 150 events a year to make the effort worthwhile. If these events were evenly
scheduled throughout the year, the,building would be dark four or more days each week.
Staff believes this infrequent use does not meet the Mayor and City Council's goal to have the
Pavilion Building function as a center of activity in downtown Renton. However, if other efforts to
secure a more active tenant are not successful, an event use of the building may be a good way to
have some activity in the building while downtown Renton continues its revitalization efforts and
the market for retail improves.
International Museum of Carousel Art
The International Museum of Carousel Art (IMCA) is a 501(c)(3) nonprofit educational
organization dedicated to the preservation, restoration and exhibition of the world's antique
carousels and carousel related art., Founded in 1983, the IMCA has been the dream and passion of
Northwest residents Duane and Carol Perron. According to the organization's website
(www.carouselmuseum.com), the Perrons have built a small private collection that started in the
mid-1970's into "the largest, most comprehensive collection of carousels and carousel art in the
world." The Perron family collection now numbers nearly 1,000 carousel animals and chariots,
hundreds of other artifacts and 23 carousels. The collection is valued at over $8 million.
The Perron family has worked to preserve both the unique carousel art form, as well as "the
timeless experience of a carousel ride." They have restored nine antique carousels and currently
operate carousels at eight locations around the country (including New York, Ohio, California, and
Oregon). Historic Carousels; Inc., a for-profit corporation founded and managed by Brad Perron
(one of Duane and Carol Perron's two sons), operates all of the Perron family's active carousels.
The IMCA also has a traveling exhibit (including a carousel) that they have displayed in various
cities, including Seattle at the Pacific Science Center in early-2003'.
' EDNSP staff connected with George Moynihan in summer 2003(just before he retired as the executive director of the
Pacific Science Center for 23 years)to discuss his experience and perspectives regarding the carousel exhibit. He said the
carousel exhibit was at the PSC as a special exhibit for 12 weeks in spring 2003,during which time there were 58,000
December 7, 2004
Page 4
The IMCA has operated a 6,000-square foot carousel museum in Hood River, Oregon, since 1999
with various other off-site operations and storage facilities in the area.2 The Hood River operation
is close to the Perron family ranch, but the Perron's also have a residence in Port Ludlow,
Washington. The Hood River carousel museum is open to the public Thursday thru Sunday, noon
to 4:00 PM, and by prior appointment on other days. However, the Hood River carousel museum
facility is not large enough to include an operating carousel. Mayor Kathy Keolker-Wheeler,
Council member Terri Briere, CAO Jay Covington and EDNSP staff recently toured the Hood
River carousel museum and the IMCA's other storage facilities.
Carousel Museum Proposal
Darrell Vange first approached the City to discuss possible use of the Pavilion Building for a
carousel museum in April 2003,just prior to the start of the renovation. He has known the Perrons
for about ten years and has assisted them during that time in fording a permanent home for the best
of their carousel collection. Although the City decided to wait until the Pavilion Building •
renovation was completed to market the building, EDNSP staff reconnected with Mr. Vange in
April 2004.
As part of the department's efforts to explore options with a variety of potential target anchor
tenants, EDNSP staff worked with Mr. Vange and the Perrons to explore the potential for the
IMCA to establish a carousel museum at the renovated Pavilion Building. After marketing the
facility for a number of months and hearing from many prospective tenants about the perceived
limitations of the current downtown Renton marketplace for most of our targeted anchor retail uses,
EDNSP staff determined that the carousel museum stood out as a unique opportunity to utilize the
building for a potential regional attraction.
At the end of September 2004, the City and IMCA jointly engaged Darrell Vange at Ravenhurst
Development Inc. to create a conceptual business plan for a carousel museum at the Pavilion
Building.3 Mr. Vange's "IMCA Business Plan for Renton Pavilion Building" report (attached)
outlines a conceptual proposal for the IMCA to establish and operate a carousel museum(including
paid carousel riders plus many others who toured the exhibit. Mr.Moynihan had very positive things to say about both
the exhibit and his work with the Perrons who coordinated the exhibit. Since the PSC is an ongoing regional attraction,it
was unclear how many people attended the PSC at that time because of the carousel exhibit. Mr.Moynihan was reluctant
to predict how a carousel museum would draw as a.stand-alone venue and he deferred staff to the Perron family for
guidance in this area based on their expertise. However,he did say that he did not think the PSC would be interested in
establishing a permanent carousel exhibit. Because of their limited space,they need to target permanent exhibits to items
that more directly relate to their core science-related mission. However,he said that he would love to have the carousel
exhibit come back to the PSC each year.
2 The non-profit organization also operated the Portland Carousel Museum previously at the Willamette Center(1984-88)
and Lloyd Center(1988-1992),but they lost their space as a result of a change in development plans and/or ownership.
3 The City and Duane Perron each paid Ravenhurst Development,Inc.$5,000 to prepare the conceptual business plan. If
the City proceeds with the IMCA carousel museum,the City will owe Ravenhurst Development,Inc.a$40,000 brokerage
commission,less the$5,000 paid by the City for the business plan. Fifty percent of the commission would be due when
the lease is signed and the balance due when the carousel museum opens for business.
December 7, 2004
,, Page 5
an operating historic carousel) at the Pavilion Building'. The report includes a narrative, building
layout, admission fee comparison, comparative facilities data and three financial models -the
"optimal" model and the "Perron" model, plus a "hybrid" model. The "optimal" financial model
has increased capital investment and marketing/fundraising, but would also produce a higher-
quality facility and museum experience with faster growth projected. The "Perron" model has
limited front-end costs and slow growth projected. The "hybrid" model essentially reflects the
"Perron" model with additional first-year marketing resources to increase attendance.
As noted in the business plan, the'IMCA believes that the Pavilion Building in downtown Renton
. __ represents a unique opportunity to achieve a permanent home for its__corecollection, with ideal
exhibit facilities, guest services and parking, in a densely populated urban area near Seattle. The
organization proposes to lease they entire Pavilion Building from the City for a ten-year period with
options for an additional twenty years. They would operate an historic carousel and present "the
forest exhibit of carousel history, art and whimsy in the country," drawn primarily from the
collection of the Perron family.
Within the building, the area would be divided into two general areas - the museum portion (which
would require an admission ticket, for entry) and the carousel area (which would be open to the
public without any entrance fees but would require a fee to ride the carousel). The complex would
also include a gift shop, limited food service, birthday party rooms and the capacity to hold evening
banquets and parties in the evening after the museum is closed.
The proposed museum caters to two basic audiences. The first group is interested in children,
whose primary interest is to ride the carousel. They are likely to be from the Puget Sound area and
may visit multiple times each year. The second group is interested in carousels. They are less
likely to have children and will come from a larger area in western Washington, and some from
out-of-state or around the world. !Third year attendance projections for the carousel museum range
from 123,460 to 145,660 per year (again, depending upon which financial model is used),
excluding banquets and special events. •
Proposed Deal Structure
The conceptual business plan proposal includes a rent structure based on a percentage of the
carousel museum's annual gross income, beginning with no rent for the first $100,000 of gross
income, 15% rent on the next $100,000 of gross income, 20% on the next $100,000 of gross
income and 25% rent on anything over $300,000 of gross income. For example, the projected rent
for the third year of operation ranges from $92,111 to $123,530 (or a range of$9.60/sf to.
$12.87/sI') depending upon which fmancial model is used. [For comparison purposes, the
"National Fitness Center" proposed $16.00/sf(i.e., $153,040 per year) and Shelby's Concepts
proposed no rent for the first two years, $12.00/sf for the third year (i.e., $114,780) and 5% of
total sales when sales reach $2,500,000 (i.e., equal to approximately $125,000+ per year in rent).
4 Although Darrell Vange worked closely with Duane Perron to prepare the IMCA carousel museum business plan for the
Pavilion Building,the actual lease terms will need to be negotiated by the City with representatives of the IMCA.
5 All of the square foot rent/lease projections are based on the 9,595-square foot open hall.
December 7, 2004
Page 6
Depending upon the financial model that is used and the success of other potential fundraising
opportunities, the City-paid tenant improvements and other pre-opening expenses could run from
between $150,000 and $500,000 for the project. (This compares with $250,000 in City-paid tenant
improvements requested by the "National Fitness Center" and $600,000 to $1,200,000 in projected
City-paid tenant improvements requested for Shelby's Concepts.) The Perron family and IMCA
would contribute between$76,000 and $132,000, plus the $3.8 million estimated value of the
loaned carousel, collection and exhibits.
The tenant improvements include modifying the floor to support the carousel, lighting and security .
improvements and the addition of.office and birthday party room spaces, a ticket counter, food and. . ..... .....
gift areas and a catering prep area. The other pre-opening expenses include IMCA staffmg and
marketing costs, plus exhibit lighting and staging.
For more information regarding how the IMCA carousel museum proposal compares with the
"National Fitness Center" proposal or Shelby's Concepts, please see the attached "Comparison
with Other Potential Retail Opportunities" chart.
CONCLUSION
The IMCA carousel museum represents a unique opportunity to use the Pavilion Building for a
public-oriented use that has the potential to draw people to downtown Renton from throughout the
Puget Sound region and beyond. The carousel art builds on Renton's craftsman history and adds to
the entertainment opportunities and collectibles theme in downtown Renton. The carousel museum
would also utilize and benefit from the expansive open architectural style of the Pavilion Building.
Although the City would need to contribute additional funds for tenant improvements, the
economics of the carousel museum proposal for the City are comparable or better than the terms of
the recent restaurant and banquet/meeting room proposal submitted to the City (and later
withdrawn) or other potential deals that EDNSP staff anticipates might be possible at the Pavilion
Building under the current market conditions. Consequently, the Administration plans to negotiate
a lease with representatives of the IMCA to use the Pavilion Building for a carousel museum. The
lease will be subject to review and approval by the City Council. If the City can come to an
agreement with the IMCA, the goal would be to have the carousel museum open at the Pavilion
Building by summer 2005.
Attachments
cc: Jay Covington
Dennis Culp
Ben Wolters
Mark Santos-Johnson
• _
•
Pavilion Building
Potential Anchor Tenant Targets
December 6, 2004
1
DEVELOPER(8)
,Mtvationv, .
2 Jack Alhadeff,JDA Group LLC
• . - A„,"
'!'°16W(67171ATaill Of° in cpft=•,•
4 Bob Parks,TRF Pacific, Inc. I
,
M
Z. ovnerof ,
6 Darrell Vange, Ravenhurst Development, Inc.
$KuDmjèrugar ntain OitalTi.;fbI4-,;,-PataSaC-0art0.!ReOCIfer$:;.1100.-1,4k4,09.1,9„4-9,019
8 Al Copeland,Al Copeland Investments
RESTAURANT/BREW PUB(71)
10 McMenamins
•
Ft.''kgaiiiifitteiBIotherReitauratits1.(thbfagDantelis413roligrl,c1,11,a,,,
Ridozzaltalithileafe
12 Jak's Grill
13 Salumi 7j
:„.ye •,• - . . •• • -
14 Tutta Bella Neapolitan Pizzeria(formerly Salumeria on Hudson) _
.-,•,,,' -N,V.1-,144*.Vit.4.1•.;,,, ,1„,,,7„„A___" 4"-AA
16 Chili's Grill&Bar
•• •- -m•Tr`• .••-• ; '717:77" „
.-747iche''.6" • •-
18 California Pizza Kitchen, Inc.
, • • *A; •
20 Chow Restaurant Group (Chow Foods -d.b.a.The 5 Spot, Coastal Kitchen,Atlas Foods &The
'• •'"
401*.),„liciate
.e? —
22 Portland Brewing Company
3Duk6A10661'-',40.1) '6V-tfroWderfAtilkWirCitirti... fia,
24 Tom Douglas Restaurants (d.b.a. Dahlia Lounge, Etta's Seafood.,falace„ itchen)„„26-grAMI dig lir Farriisi)13,004-o.Y.:iritsi'
. , .
26 Circa(Grill &Alehouse)
- 4 •',?••
,,k-Tc,17 r..--- ;••••=4•-:`•••• ' •- 1•'•• • • -
28 Ruby's Diner •
30 Pyramid Breweries
- ;Car! . - .AN '
' '- •
32 Sam's Sushi
q,-zrgrk.
V33V,IMCOOrffiler'f&ISetcriiiek:driTS- 5n49.1:FIigtt
34 Merchant du Vin (d.b.a. Pike Place Brewery)
36 Big Time Brewery&Alehouse •
-zr, ••.‘
38 • Elliott Bay Brewery
• -- ______Bugs j -
40 Elysian Brewery
A-
42 Garden Fresh Restaurant Corp. (d.b.a. Souplantation &Sweet Tomatoes)
1.114:304,61Sette4t14.,111b
„ .
44 Armondo Pavone-Armondo's
r74514.0:;iiiigiiiiilatdkiganaglibiTORRAterigiRIT151.V. :-ettrk,Are7",.ip
46 Larry Dixon, Dixon &Associates- unspecified restaurant client
41:77,1?;,-",:77F-7.377-7,77;73
48 Restaurants Unlimited Inc. (d.b.a. Cutters Bayhouse, Palisade, Palomino, Kincaid's, etc.)
i.48k1Ch01:17,00Grii°01:,q•d;
50 Mackay Restaurant Group(d.b.a. El Gaucho,Waterfront Seafood Grill,Troiani& Rippe's)
76-6ifibi374;•+-
. : Pr-n.•,,
52 Gordon Biersch Brewery Restaurant Group, Inc.
riw37.1-1-15w,.
54 I Love Sushi
55,== •_ •
56 Wasabi Bistro
58 Mashiko
60 Azuma Sushi
61&:Nruggs •
.
62 La Hacienda Mexican Restaurant
63 Sb yTs Restaüraitandice k'StielbyV-06-6110:aritia414.161
64 Holland Restaurant(d.b.a. Burgerville U.S.A., Beaches and Noodlin' restaurants)
„.4. ;,•
4-v1,11! etri-Y,..k.:, ^d'it•
66 Manchu Wok
--BaQiriVBrocrt•-efV-v—Mirgiiiitliiive'dei4;'GriPPla'='ol4Sitiob ;8;: ied-'111bed16141duiey
= . L ,• - •
68 White Spot Restaurants
P.e5§Yiai'rjiiiaiYfe-K4fWFPeEzeITFlbitittintWz7r7F7-:t7-Ik
- •
70 Chicago Pizza&Brewery
rgA7.7.A:Prbp_j,-6A§1§Ii
72 Outback Steakhouses, Inc. (d.b.a. Bonefish Grill)
74 Todai Franchising, LLC (d.b.a.Todai Restaurant)
tehtiatAftetnà701.40-iiii001:101(6e.a. 0
76 Fatburger
VqrC,Witg'rbVFratais.itOktegqg2-ta,,-R6f:_gi__'fo!t,_Maar-dnrG.rilfkylgl:: P,-i-'4-VM54'*t'a;ieiNf44,4(Fgl
-, -
78 Fins Bistro
ix* = . • , •
GROCERY/FOOD(17)
80 Trader Joe's
Wv PC Na u al Maiketi ''',-;s4;'nk,,-4-',:,:',4',.744,14f-3-ieo-sicIl•W:Wor.-€-•-,A;-•fl:Av-;-',,,-71$A.,.
82 City Fish Co.
84 Madison Market Central Co-op
86 Uwajimaya
rttpitie-awtogribef :17,7,-;:;:s ,'"44'gOlak7:7:7'77.777:799
88 Beecher's Handmade Cheese
•=.. • . -
90 Delaurenti Specialty Food Markets
••
92 Wild Oats Markets Inc. (d.b.a.Wild Oats Markets, Sunshine Markets, Sun Harvest, Beans &Things,
People's Market&Uptown Whole Foods)
93 W'Id°AIM': 1441c-Z;-.4i4g,i:,,',;;;.•44;4474,Wr,%44-717-M-4iisdik';'7:4% 411,-,g,',PF.1,012.:":
94 Essential Baking Company
..!-,,S'V';?,7i;f;Z.'717z;;';',''; tbia-:';,F,474,:i.';7-41.= •;;IkiT;'-'1.iWn':',':::'X'-'''7'-V-,W.: :-?•: ,;5:1307,!!! 7.117=iP''
96 Renton Technical College
•
BOOKSTORE(5)
98 Borders Books
100 Powell's Books
;
DRUG STORE(1) 1
102 Bartell Drugs
MUSIC/ARTS/ENTERTAINMENT/RECREATION(14)
"":1?,1"L'!A;?.',114k1
IrodrRe60.
104 Cellophane Square (Records)
1-',JNIs'Avti,,k.-•
106 Seattle Art Supply
108 Belltown Billiards
110 Gregg's Greenlake Cycle
1ktprrtionaIMus 'it`q;i00.011.0el'Ark,-06160
112 World State Ministries-Sunago Café
41 fx,-1,0A.1.4-ottrpegtt:
'a;:e1tt4r,,- (,.."1114.= •-,1„,:35„
114 Shipwreck Beads1I 5 BIuelnsBe ds
116 Impress Rubber Stamps
FURNITURE(4)
118 Kasala(Furnishings for Modern Living)
,419kiSijcients'
120 Drees
"EVENT" USES(3)
$121;'Gii0(it's:Sai)§:; Oiana Post ekitairil,Piketitjaf,g4blimatkotzli
122 Spirit of Washington Dinner Train-potential "banquet/meeting/special events venue"
-Nark Santps-Johnson-Shelby'ss,Restary)--�t and IceCreamery&Shelby's Meeting ai,r -'jn uet Facil �.. _. �" Pa e.1
From: "Shelby Varden"<shelbyvarden@msn.com>
To: "Mark Santos-Johnson" <Msantosjohnson@ci.renton.wa.us>,
<apietsch@ci.renton.wa.us>, <bwolters@ci.renton.wa.us>
Date: 11/12/2004 1 0:03:41 AM
Subject: Shelby's Restaurant and Ice Creamery&Shelby's Meeting and Banquet Facilty
Hello Mark,Alex, and Ben,
Mark, in response to your previous e-mail, my fundraising has been giong very well,thanks for asking and
for checking in!
Alex and Ben, it was a pleasure meeting you the other night at the public hearing for the Lakeshore
Landing project. -
This project is very exciting and will be a wonderful asset to Renton. I am looking forward to this addition
to the city. When I read the article in the paper a few weeks ago regarding the project I became
concerned about how this development would impact my business. The public hearing provided a lot
more information and better confirmation that this project will come to fruition. The concerns I had about
how the Lakeshore Landing project would impact my business really began to sink in throughout the
presentation. These concerns include:
1.The Lakeshore Landing is going to be a huge draw with its retail shops, restaurants, amenities,theater,
and offices. This will detract from the downtown Renton core and pull business away from my restaurant.
2: It is my understanding that the Lakeshore Landing project will not be complete for 2-3 years,this is the
approximate time when I would be breaking even on my restaurant and banquet facility. I cannot risk a
potentially big drop in my sales revenues at such a critical time.
3.The area where the Lakeshore Landing will be located has wonderful visibility,easy access from many
directions, and lots of convenience. The location of the Pavilion building is too far away from the location
of the Lakeshore Landing to really benefit from this traffic flow. The main traffic flow to and from the
Lakeshore Landing doesn't go through the downtown core of Renton.
4.With the city focusing on the Lakeshore Landing I feel the downtown core revitalization will be pushed to
the back burner and the redevelopement effort will focus on the south end of Boeing and the Renton
Highlands. From a city business standpoint,this is where more revenue will be generated for the city and
thus, I would think the city would want to focus.
5.The city has done a wonderful job with the Farmer's Market,Open Cinema,concerts,and other great
activities in the Piazza. Unfortunately,these are very seasonal and even though they are beginning to
draw more people, it will not be enough to sutain my business during the off season and days without
activities compared to the draw of the Lakeshore Landing.
5. It appears that the Pavilion Building tenant improvements I will be asking the city of Renton to pay for
will be between$600,000 and$800,000. I feel that my"modern day Farrell's" restaurant and banquet
concepts will be a big driver of people to downtown and will achieve the goal of helping revitalizing the
downtown core;although, I don't get the impression that this dollar amount will be realistic for the city.
Even if the city fronts the money,this would not help sales decreases when the Lakeshore Landing opens.
Based upon these concerns and the increased risk of opening a business in the downtown core of Renton
with the Lakeshore Landing project, I am going to withdraw)my proposal to open Shelby's Retaurant& Ice
Creamery and Shelby's Meeting&Banquet Facility. I have tried to separate my emotional connection to
my business plan,the work I have put into it, along with the work and time others have devoted to my
business plan and proposal In taking the emotion out of the equation, it would not be a good business
decision to move forward with my plans at the Pavilion Building location. I will continue looking for other
locations and will look at the Lakeshore Landing, pending the typically higher lease rates of a new retail
Mark Santos-Johnson Shelby's Rest ,:Tit and Ice Creamery&Shelby's Meeting r J,Ban-guet Facie - Page
development.
I would like to thank Mark for his time and efforts during the proposal process, he has been great. If the
city decides to use the Pavilion Building for a meeting and banquet facility I would like to be considered as
a tenant and will submit another proposal. There is a difference between the draw of a restaurant and that
of a banquet facility. A meeting and banquet facility is a destination spot and the Lakeshore Landing
would not have the same pull of people away as the restaurant would have. In spite of the impact that the
Lakeshore Landing project had on my decision to open a business, I am still very glad that the city of
Renton is moving forward on such a:tremendous project and look forward to its opening. If you decide
you have no more need for my proposal, I would like to have it sent back to me or I would be happy to pick
it up. If you would like to keep it for your records please feel free to keep the proposal.
I thank all of you for your time. If you have any questions, please feel free to e-mail or call me at
425-255-0647.
I wish you the best!
Shelby Varden
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CC: <kwheeler@ci.renton.wa.us>
Pavilion Building
Comparison of Recent Proposals
December 6, 2004
International Museum of Shelby's Restaurant/Ice
Carousel Art - Carousel Creamery &
Museum Meeting/Banquet Facility "National Fitness Center"
Ten year lease with options for an Ten year lease with several five- Five year lease with three five-
Lease Term additional twenty years year options year options
y .... .:."., ...,.,, ......r.-: -..a3:f.,r.,`.:'-`..n"'.aC:'...r',.t,..,.as v�`ry F eu,�X:.::4d[awY.s Tel.:,G.
�1.saaa.,:.�,.,._,...,,,,,�a.._y.'.<r.a.'»:,.,....<�..:a.:e�.........._._.�:..�,,,:5.—s;.:z.".k"'r.:�;,;,+�,,..r.•.<.:.,...�u.:�??.r.....�,........,_.,._... .r,....." �7 D^a...._-, '
Space Entire building Entiebu:•ld'>..in.j..:
Entire
building- r�� r ;Y: ';';'•=7.," 77277 7,77T7',,^ r ,.7. _ ,. ...__
_.,..._, -7
.7
7:M„.idicaT{"4"aPaw.l"ff.�
• No lease payment for the first 24
months of operation and then
Rent payments based on $12/sf;when sales reach $2.5
percentage of annual gross million/year, lease payments $16/sf for years 1-5; increases
Annual Rent/Lease income-tiered to 25%of annual change to 5%of total sales (e.g., every 5 years per formula not to
Payments gross income over$300,000 $125,000+per year) exceed 10%
xs'".'".e�3-✓.,,,;*m;1•ey`••.'*ams:ec^ b^F',_•^a. a•'�._.:,, •-"„��*e.A.�s--'^.c-'�.°" v ' ^-=a�-''m,-'....�-^^^^^i'=� t',�. s^R. ;•r^�., _. ,s`,.
Projected Rent/Lease
Payment-Year 1 $42,091 $0 $153,040
'.'.''•-a"^.y..'°..'°,'`,q'',..'....,". '+'aT,`'r`a .�5.' .rl+"';;�"^'t° »;'��''J�°;•."�'.:`'' a'zr-; `4+ ^:!x'67 ..rv�.r„"w?a�r, y,. Y:S:., '. :_.2...�,.�,-�:• .^� , �4.:." ��.�.;�"' ��...� �vr.,,,5y,..�_,...�.ax 3',.,r r.,'=s.:.��..:_:..;,� '•`•.°{%:sp''rs4'->.:,�,�c.»,.�.... ...s "•e^:y:
Projected Rent/Lease ^s:�.:.�::,._.-y.'.n`.;.:•-::,;ga::,Fw'..°.^,.+Mr.L^+:,,^�.^.wWx,s-�',f...^"�'t"�%.,_-.-...'...-y,.,-"r.,._,_v.ry�.,,.T.,�"
Payment-Year 2 $69,388 to$94,172 $0 $153,040
•.:,' .::' ^^,S:- T-^fid..Y2,.-,.,- .,�C';-,--er v•,y,y.« .,Fa.. w4'T^"q:^i :P'�:.-k•-
... :.. ., �.;,•^�"`3".:.,. ,.,+ ✓s.ar - 1 4 e....L..ia G i eL S {u.4 ,.,eE '�::;
:.,....Cv.... c.1. ...L•.�..d °':5+.'.�d�'4,...�:��'[ ,r 1 ..«r—,-m _..............«,......-....�,.,., .�,. .,... ..<,..wi..^... <«..w .. ..0 m.. ....... ..c. :..w,,.......1?:',71 w 7=173
Projected Rent/Lease
Payment-Year 3 $92,111 to$123,530 $114,780 $153,040
r`r..?'ev-„-,.;,r,TT.: ......r^�{wr^•ra;,�s..., M:<.
..t- ....Y., ,.neMx. dx«...e ^, . , y"i •...•yry.,r+ -7771'7744.-',3'`>'tr^-a.:i^.;^.•r•M:
e,^';�;^g 's,n�a'-•'�"'°,'�m-;, v.?^,-r-•-'•,-,,s';p,.,«......",",i
•,�,,,., ^.,�,
Projected Rent/Lease
Payment-Years 1-5 $344,340 (more if sales reach or
Cumulative $413,487 to$542,115 exceed$2.5 million/year) $765,200
p..T.PpY.,s,,. .,>•,..Ro. �"�"''='�`-:;�^••—...:,-,g ,R-j..,;-.�avu:,,�;..-�,.,, ;r,-, �^-s"'x �, r -9-?.;x:^,. _
-•:.. ., r^,;...,_, _�•_ .-...:_ ..a.,.-,�n.•v ... ... Y;� ':"�'?. ,'.i::.-:.a.., _'= .>- °:'.^?:i`:a"#'rs+;•� ?'-'Y.^'":"r..,m:t,^^'4 ,!;'*.'..•�,.-�+=r..”a•,g"s"` .i:P' ':^'p!`rc";-v
approximately$68,868 (more if
Average Rent/Lease sales reach or exceed$2.5
Payment-Years 1-5 $82,697 to$108,423 million/year) $153,040
s„•.-„,,„;.:;r.,,-.c'-:+--n+y-q-,•,,z..-.--.-,,e•.:,,.-,..-„'-:_ ""2-za.:'v.'. :.:.r•„--,.:...,.:-,..p,-,-.: tr ;.r;°.ozr.•'-,.'�„_, `rr»„y,«•.,,;,,.„� -,Z:-,....:-:-:-:w�-m
-, i..•... 1•.:.� ,-rr .. , .,:,., ,,, ... ,.-Y`i`. ...,,�;:.�,"�::......-... .. ., .: h. f, [.. .'^6raT'•iP -!':.'c•t:7 .,,,-^"""':-"'r,""r='..,_- n.-�-.•:'i.'trA;^�,
w_a_..,,<e... .... _ ...,...._...........�....s..s-..,�_.._..__.. ..•a....w., • �.,.v..we..-..da,.:,.^....._.,..._.....,.-.»,v.. ::ri.�-:..:___.>�,r.a�,��.':..:.....u..,..,..w...'',a.sg:...>�,r+, _._.,...,,,.,-.__-:`u::.:,..,......Isis v_.,.�.t„��.-. e.,s:..."t'wi`t>,_:::..:,:_'::.;..,.�._:.:.5,>:.::.«•..��,_..<.`�"S
Average Rent/Lease
Payment per sf-Years 1-5 $7.18 (more if sales reach or
(based on 9,595 sf open hall) $8.62 to$11.30 exceed$2.5 million/year) $16.00
L's.. s.•.” ,.�.y,., -,.x;a.A^S,,,.27...u.:s"z^.a.T^"=' �.,":F.-y". +-...r'^4•a4. ^".'*:c:.2-7—,,� ,..pr„w•.,.,;s,,..e , -7 ,..-_ ,,-777 re,^ -,,,,•, ,..;,-,.
a-n:;s'-;-'�,TMf• .::1''747757s):=47-977=-,===:•757."7,. ...a..., ...r"s�'.:.4,u:..:.w,.,..,......,.�.F.'i:ao:;c::.:+an:..� '�•�z��-''`'�ti,- ; n<.�,.. ,�-:�..rs�'��'t�,x=.,��...s4:.... t.^' _r, '�, � ma,... =�
Modify floor to support carousel Add full restaurant/catering
weight; lighting &security kitchen, ice cream parlor counter,
improvements; add office and lounge with fireplace &bar, both
birthday party room spaces, a main and private dining rooms Add showers, locker rooms, a
Major Required Building ticket counter, food and gift areas and renovated meeting &banquet babysitting area, office space&
Modifications and a catering prep area facility space lobby
PL'» _ . .:....:«w...« e"4'777 771."
,.x w . w : .:.
Tmw « :L".i,i.: .HYwy.'.^,.wC„"+".^.w�"m.�o-x..r,w..,w.u....i......w»Lu.weM.me...N'm..,5.:R.•r..............a....Tara:s�
%.w,,.,....,..t..
All tenant and leasehold
improvements, plus related
Approximately$150,000 to architectural and engineering
City-Paid Tenant $500,000, depending upon costs costs. Estimated costs range $25/sf tenant improvement
Improvements &other fundraising from $600,000 to$1,200,000 allowance (e.g., $250,000)
770'77 4.717'77-w , r,5t.w""7:77F^,7,?e.;,:v'^ ""^;+,a:*.T-r�'717. 42Z.,Zaf .:?w'„�� i,. .: :?;.x:• •:,:c,"-*."
- - Between $76,000 and$132,000 - ---All personal property in the
(including in-kind goods & building, including furniture,
services), plus$3.8 million in fixtures &equipment(FFE) -
loaned carousel,collection & included in other upfront costs All tenant-improvements over
Tenant-Paid Improvements exhibits below $250,000 City contribution
Pre-opening IMCA staffing and $685,000 in projected tenant-paid
marketing costs, plus exhibit opening costs, including FFE,
lighting and staging, included in training, pre-marketing, starting
above City-paid and tenant-paid inventory, case reserve and start
Other Upfront Costs improvement figures up costs N/A -
,_,�:.:;T; ,
6%of gross lease amount of the
initial five-year lease term (e.g.,
Commission/Leasing Fee $35,000 N/A $48,000)
. = r
Tenant responsible for leasehold -
tax&insurance; City responsible Limited initially to a maximum of
for exterior common area $4.00/rentable sf per year with no
Operating Expenses/Taxes maintenance TBD more than a 5% increase per year
p- t:«. -r:. '_:r,=.v^.'<°t+'+-:n^,.^ n..rrnr,. .•e�gr, rTw,.r: s:'•vMrr, "e :.rv;,w'y."y,-,�,.,.,..., ...F_ '117..^c .,+.r..--..«.csr...a-;,.�.:..,rs._._c:»c. ,<.a;•r'.= „^^'e^sx;r-r.,..+4' ::^„'r-,-.m„-.>..--"'e-'"«-,-• ,s.H
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Utilities Tenant responsible for all utilities TBD Tenant responsible for all utilities
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? „ , International Museum of Carousel Art—Business Plan
' A'°y'fg
Ali a A'zi . Ravenhurst Development, Inc.
4' 11/29/04 •
•
1. INTRODUCTION AND SUMMARY
A. Introduction
The Pavilion Building in downtown Renton, WA,,represents a unique opportunity
for the International Museum of Carousel Art(IMCA) to achieve a permanent
home for its core collection; with ideal exhibit facilities, guest services and
parking, in a densely-populated urban area near Seattle.
IMCA proposes to lease the Pavilion Building from the City of Renton for ten-
year period with options for;an additional twenty years. In the Pavilion, IMCA
would operate an historic carousel and would present the finest exhibit of
carousel history, art and whimsy in the country, drawn primarily from the
collection of Duane and Carol Perron.
This business plan estimates the costs and revenues for such a facility,
compares the operating assumptions with data from other comparable venues,
and makes recommendations regarding the services and market segments the
museum should try to capture.
B. Summary of Conclusions
• Viability:
Based on our analysis,the carousel museum concept is a viable use for the
Pavilion Building, where viability is defined as a use that:
1. Contributes to the activity and vitality of the downtown area;
2. Pays rent to the City at;dose to a market rate; and
3. Requires similar investment levels on the part of the city to those required for
any retail tenant.
This conclusion is subject to an important caveat. In order to be successful, the
museum needs sponsorships and fundraising for front-end capital investment in
the amount of around $300,000, and the organization will need to develop a
marketing staff that can continue to seek community and corporate support for
the facility.
The carousel and museum combination would bring between 100,000 and
150,000 people to the downtown each year that would not otherwise visit
downtown Renton, including tourists, regional visitors and local families with their
children.
International Museum of Carousel Art—Business Plan
Ravenhurst Development,Inc.
11/29/04 Page 1
•
While most non-profit facilities cannot afford to pay any rent, this operation could
afford to pay rent between $10 and $15 per square foot by the fourth year,
depending on the assumptions used. $15 to $17 is deemed to be "market rent"
for the space.
The museum would need a minimum of$100,000 in tenant allowance, which is
similar to the needs of any tenant moving into the building.
Expertise:
Duane and Carol Perron have the expertise to operate a carousel and associated
museum, as has been repeatedly demonstrated over the past twenty years.
Their organization operates at least five carousels currently in various locations
around the country, and they operate a museum facility in Hood River, OR. They
have also staged temporary exhibitions of their collection in Portland and Seattle
with great success. As individuals, they possess the largest collection of historic
carousels and related artifacts in the country, and they may be the most
knowledgeable people on the subject anywhere.
2.THE PERRON VISION
While around 10,000 carousels were built in the United States over the past 100
years, only a hundred remain intact, because they are large, cumbersome
objects to display and operate, and because the value of the individual horses
can exceed $100,000 per horse, and an individual piece is much easier to
display and maintain. As a result, the few remaining carousels are being broken
up and the horses dispersed to collectors.
The Perrons have always felt strongly that the dynamic experience of riding a
carousel is more valuable than the static display of the horses, and that the art
and the history can be better preserved by keeping the carousels intact. Twenty
years ago, they set out to save as many of the remaining carousels as possible,
and they now own 23 mechanisms and over 600 horses. The collection is valued
at over$8,000,000. They continue to purchase machines whenever the
opportunity arises.
They steadfastly refuse to sell any portion of their collection to pay for the
restoration or maintenance of the carousels, and instead, they have funded the
care and acquisition of additional machines by the operation of five or six of their
carousels in malls and parks around the country. This program generates nearly
a million dollars each year,which they plough back into their passion, rather than
enriching their lifestyle.
While they have created a non-profit organization, the International Museum of
Carousel Art(IMCA), they continue to own the collection personally. Their goal is
International Museum of Carousel Art—Business Plan
Ravenhurst Development,Inc.
11/29/04 Page 2
to give the collection to IMCA once IMCA is strong enough to ensure that the
collection will never be sold, but that condition does not yet exist. Their goal with
regard to Renton is to create a permanent home for the collection, which can
generate revenues through admissions, ride sales, parties and banquets. When
the Renton facility proves that it can support itself financially, the Perrons will
consider transferring some portion of the collection into the self-sustaining non-
profit.
The Perrons are mavericks'in the carousel community, and not all of the
collectors and organizations share their views. Because of their dogmatic
positions, they do not receive much support from the national carousel
organization. But to their credit, they have single-handedly accomplished more
than all of the other collectors and preservationists combined. They are not good
fund-raisers, but they are excellent nuts-and-bolts people. They do not have
"sophisticated" ideas about marketing and museum displays, but they make up
for it through commitment and total dedication to their field. They are, frankly, a
mixed blessing, but they are exactly what they say they are, and their
commitment should not bel dismissed.
3. ALTERNATIVE DEAL STRUCTURES
•
After all the analysis is done, there are basically two ways to build a successful
carousel attraction on this site. The simple way is to put your faith in the Perrons'
track record, turn the building over to them and let them build the business their
way. They will fill and open the facility almost immediately, and will build
attendance slowly using a simple marketing approach. For the more refined and
costly elements, they will use a bootstrap approach, investing in the facility and
its operations as funds become available from cash flow. This approach requires
a lower city investment, and has less direct involvement and less capital risk.to
the City.
The second approach takes the Perron proposal and augments it in the places
where it is weak, namely capital investment and marketing/fund-raising. This
would require a larger capital investment on the part of the City, as well as more
direct involvement. But it would also produce a higher-quality facility and
experience, faster growth, and a more community-embracing program.
In the two financial models, we have projected the costs and revenues of two
programs. The first is based on the Perron proposal, with limited front-end costs
and slow growth. The second is an optimal model, presuming that a professional
development and fund-raising program could be implemented. This is the
program that best fulfills the goals of the City, but it would require that the skills of
the Perrons be augmented either within or outside their organization.
International Museum of Carousel Art—Business Plan
Ravenhurst Development, Inc.
11/29/04 Page 3
•
A. The Perron Proposal.
While the Perrons have not made a concrete proposal, we have summarized the
basic elements that they would propose. These include the following:
• A ten-year lease between IMCA as lessee and the City as lessor with
options for an additional ten or twenty years.
• Rent paid to the City based on a percentage of annual gross income,
on the following schedule:
• No rent for the first$100,000 of gross income.
• 15% rent on the next$100,000 of gross income.
• 20% rent on the next $100,000 of gross income.
• 25% rent on anything over$300,000 of gross income.
• The City would provide $100,000 in tenant allowance, in a combination
of building improvements and cash. The Perrons and IMCA would
contribute approximately $80,000 in goods and services to build out
the facility.
• The Perrons would fund all operating shortfalls.
• The Perrons would not be compensated for their management or for
the loan of the carousel or exhibits, but their expenses would be
reimbursed, at a cost estimated at$20,000 per year.
•
• Duane and Carol Perron would move to Renton and manage the
facility full-time, in addition to the paid staff.
• The Perrons would execute a lease agreement between themselves
and IMCA, loaning IMCA the carousel and a defined list of exhibits for
display,for$1 per year, for the duration of the lease. The lease would
allow for exchanges and replacement of the artifacts to keep the
exhibits fresh and interesting.
• If, at the end of the third year of the lease, the facility is not generating
sufficient income to pay the City at least$100,000 in rent per year,
either party has the right to terminate the lease. The City may elect to
continue the lease with'a minimum annual rent payment of$100,000.
• The tenant would pay for utilities, insurance and all janitorial within the
building; the City would pay all exterior CAM and property taxes.
International Museum of Carousel Art—Business Plan
Ravenhurst Development,Inc.
11/29/04 Page 4
■ All operating surpluses stay within IMCA after the initial operating
losses funded by Perrons are paid back. These funds will be used to
improve the facility, maintain and repair the exhibits and carousel, and
on additional programs within the facility.
B. A Possible City Response
The Perron proposal described above would accomplish many of the City's
objectives, and over a fiveyear period, we believe the Perrons could build the
facility into a self-sustaining, positive cash flow attraction. But if the organization
is to be the long-term receptacle of their collection, it needs broad-based
corporate and community support, and this requires a marketing and fund-raising
capability that the Perrons do not possess. This is particularly true at the front-
end
rontend of the process, where we believe the program needs in excess of$300,000
of donations and sponsorship to launch the facility, and make the initial
experience a first-class visit.
Compared to other similar ventures, the fund-raising needs are quite small, and
should be quite attainable with the right personnel, but the Perrons strengths are
in operations and in their Ownership and knowledge about the exhibits, not in
marketing and development. For the program to be a success, or to reduce the
risk to all parties, the City should ensure that this element is strengthened.
As a starter, the City might consider the following response to the Perron
proposal:
■ Accept the basic deal terms.
■ Require that the Perrons hire an Executive Director to manage
marketing and fundraising. The candidates might be screened or
reviewed by the City.
■ Require that the banquet/catering opportunitybe.contracted to a single
catering firm, with a provision that they provide the needed furniture
and equipment, and that they prepare and provide a significant
marketing program for the business. The Spirit Train organization
might be an ideal candidate.
■ Fund an extra $50,000 to $100,000 in tenant allowance specifically for
the sponsorship and fundraising efforts. This could be in the form of
paying the salary of the Executive Director position for the first year
and preparing marketing materials.
International Museum of Carousel Art—Business Plan
Ravenhurst Development,Inc.
11/29/04 Page 5
•
•
• Stipulate that most or all of the surplus funds be used to upgrade the
facility and presentation of the exhibits and for marketing, rather than
for acquisitions, until some financial threshold is reached.
• Require evidence of a $200,000 letter of credit from the Perrons to
underwrite the initial operating.losses.
• Require audited income statements and a progress report form the
Perrons every six months, until such time as annual rents to the City
exceed $150,000.
• Require that the entire$100,000 in tenant allowance be used for
facility upgrades and presentation of the exhibits (lighting, interpretive
graphics, staging).
• Limit payments to Historic Carousels for management and overhead to
some fixed amount, such as$20,000 per year.
Beyond the terms of the agreement, the next steps are to have the Perrons
provide more detail of the exhibit contents and facility layout, and to organize a
marketing/fundraising committee to provide guidance and support to the Perrons
in this area.
4. PROJECT DESCRIPTION
The museum caters to two basic audiences. The first group is interested in
children, whose principal interest is to ride on the carousel. They are likely to be
from the south end of Puget Sound, and may visit multiple times each year. For
them, the museum is one of many places they take their children (or
grandchildren)for an entertaining excursion, during the week or on the
weekends. They may or may not be price sensitive, and if they visit often, they
may choose a family membership.
The second group is interested in carousels. They are less likely to have
children; they will come from a larger area in Western Washington, and some will
come from out-of-state or around the world. They will be more interested in the
museum display than the opportunity to ride the carousel, and they will be less
price sensitive.
The carousel museum will cater to both groups, and will occupy the entire
Pavilion building, leaving the Piazza and surrounding transit center and parking
structure as they are today. Except for signage, the museum would not extend
International Museum of Carousel Art—Business Plan
Ravenhurst Development,Inc.
11/29/04 Page 6
beyond the perimeter of the building, although the museum may use the patio on
the west side or portions of the Piazza for special events, in coordination with
City staff.
Within the building, the area would be divided into two general areas—the
museum portion, which would require an admission ticket for entry, and the
carousel area, which would be open to the public without any entrance fees.
Instead, the carousel rides would require a ticket, which can be purchased at the
cashier location.
PARKING AND FUTURE . _
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In addition to these two primary elements, the complex would have a gift shop,
limited food service, birthday party rooms and the capacity to hold evening
banquets and parties in the evening after the museum has closed.
.A. Exhibit Program
1. Exhibit Elements
The museum area would encompass about 60% of the building area, or 6,000sf.
It would be separated from the ride area, which is open to the public, by a low
fence or balustrade.
The exhibits would be similar to the exhibits presented in the Hood River
museum, and in fact, many of the pieces in that museum would be transferred to
Renton. This would be augmented by some of the mechanical elements
>} :. International Museum of Carousel Art—Business Plan
Ravenhurst Development, Inc.
11/29/04 Page 7
displayed at the Pacific Science Center, and a number of new displays of
collectibles and ephemera.
The Perrons are working on a more explicit description of the exhibits and their
layouts, which will be provided as soon as they are available.
2. Ride Elements
The facility would have one operating carousel, and the Perrons propose to use
the largest machine that will fit in the building from their collection. This is a
Spillman Engineering carousel, built ca. 1918, which is 40 feet wide and has a
capacity of 40 people: It features three horses abreast. The mechanism is being
operated at Clackamas, but for the Renton facility, the restored horses would be
featured on the machine.
The Perrons would also bring the miniature ferns wheel from the Clackamas
venue. It stands 16 feet tall, and can carry about a dozen kids.
3. Sound and Music Elements
Music would typically be played over the sound system, but the exhibit will
feature a restored and fully-functional band organ from the turn of the century.
4. Seasonal Events •
Special events would be programmed to complement the community's existing
events and schedule, but special activities at Christmas and Easter would be
featured.
B. Guest Services
As described in the introduction, we have prepared operating projections for two
scenarios. The first is the optimal program, where a certain amount of initial
fundraising takes place, and the operating expenses reflect a high standard of
museum operations.
The second model is based on getting little fundraising support, where the
Perrons are funding the operations out of their pockets. The operating costs are
shaved wherever possible to reduce the initial operating losses, and attendance
and growth figures are lowered.
The basic facility program and operations assumptions are the same for both
models, so the descriptions over the next few pages are identical for both. When
we get to the section on income and expense, the differences will be highlighted.
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I j
1. Birthday Party Rooms
There will be at least two birthday party rooms in the building. One will occupy
the service room at the northwest corner of the building. The second may be on
the balcony area over the east service area, accessed by a new stair. The floors
will be finished in a colorful;washable tile, and the Walls will be decorated with
large scale photo murals of carousels. Each room can accommodate a
children's party of 6-10 kids, and will have a table, small chairs and a side table.
Larger groups could use a corner of the open carousel area, separated from the
public by a balustrade.
Parties will be booked for one or two hours, in advance, and will require a
deposit. The basic package will include the room, balloons and two rides per
child. More extensive packages can be offered, including cake, pizza, unlimited
rides and/or invitations.
In our baseline projections,we use a $40 basic fee. Other carousel operations
• surveyed have.base pricing ranging from $39 to$95. We project 8 parties per
week, which is three per weekend day plus two during the week, or 32 per
month. Four other facilities, most having only one party room, averaged 40
parties per month.
Other Perron locations, such as Clackamas, give away the room for free, and sell
rides instead. This method produces between $20 and $40 in ride revenuesper
party, but the method is used primarily because the Clackamas operation is on a
short-termlease, and cannot book parties more than a month in advance.
2. Banquet Facilities
The exhibit layout has been planned to allow the exhibit pieces in the center of
the building to be moved easily, to allow an area to be cleared for a banquet
configuration seating 200 people. A banquet layout will be provided by the
Perrons.
The,northeast quadrant of the building contains a storage room that can be used
as a catering staging area to support the banquet facility. The room will contain
prep tables and a sink. If the program warrants it, refrigerators and a commercial
dishwasher may be added at a later date.
Most of the facilities we surveyed offer evening parties and banquet space, with
room for between 175 and 250 people standing, and some with banquet space
for over 200. All had a minimum fee of between $150 and $250, which might
• International Museum of Carousel Art—Business Plan
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cover only the first hour. Two of the facilities had between 120 and 150 events
per year. We are projecting one per week, or 50 per year, with an average fee of
$800. These figures were confirmed in discussions with Columbia Hospitality.
In addition to the facility rental fee, the museum could get a fee of 5% of the
gross from the caterer. 50 events with 150 people each, with a dinner value of
$50 would produce$18,750 in additional annual revenues. This number has
been added to the revenue forecast.
If the museum is willing to commit to an exclusive caterer, the catering company
may be willing to fund the promotion of the banquet business, and potentially
organize the bookings and scheduling. The Spirit of Washington Dinner Train
might be an excellent partner for this venture, as they have recently built a large
catering kitchen a few blocks from the site.
Since we are projecting only 52 events per year, and many of those will occur
during the holiday season, there will be only occasional conflict with the public
schedule for the museum. When an event is scheduled, portions of the museum
may close early to allow for set up. During the Christmas season, which should
be the busiest for both banquets and carousel rides, every effort will be made to
keep the carousel section open to the public as long as possible.
•
3. Gift Shop
The facility will have a small gift shop, on the public side of the venue. It will
cater to both the family excursion customer as well as the carousel enthusiast.
The former will feature baubles under$5.00, while the latter will include books,
photos, replicas, miniatures and other specialty items. We project a sales
volume per visitor of$0.50, or$75,000 per year. Four other carousel locations
had gift sales between $79,000 and $125,000. Venues such as the zoo and
aquarium typically generate over$1.00 per visitor.
4. Food Service
The museum will have limited food service, but the exact program has not yet
been determined. At a minimum, soft drinks, cotton candy and packaged
cookies and candy will be available. Kettlecorn has also been popular at other
venues. Other similar facilities found it desirable to add hot dogs and other more
substantial food items that were easy to prepare and serve.
The carousel in Helena, MT has added an ice cream parlor to their facility, and
sells over$100,000 in ice cream each year. This complementary feature adds a
reason for the trip and increases the stay time, making the visit a more significant
event. This should be considered for Renton, if not in the facility itself,then in an
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adjacent space. The existence of the museum will make such a use far more
viable for the downtown.
5. Hours of Operation
Duane Perron has proposed summer hours from 12:OOPM-9:OOPM, seven days
a week, and winter hours of 1:00PM-6:OOPM five days a week, but the final
schedule has not been resolved. Our budget is based on 10 hours per day
during the summer hours and 6 hours per day for the winter hours, with
operations 360 days per year.
In order to capture the weekday mom with kids, it may be more desirable to
operate from 10:00AM to 8,:00PM during the summer. This may also appease
the residential dwellers adjacent to the project.
It may also be appropriate to close the facility on Mondays, for cleaning and to
give the staff a more normal work week.
C. Attendance, Memberships and Ticketing
1. Attendance
Attendance projections are estimated from attendance figures at comparable
facilities, but since every venue has its own particular characteristics and market
niche, comparisons are speculative at best.
Attendance at the largest Puget Sound museums and attractions all exceed
400,000 per year:
Woodland Park Zoo 1,200,000
Seattle Aquarium - 600,000
Experience Music Project 800,000
Pacific Science Center 900,000
Seattle Art Museum 400,000
Annual Admissions I
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At the other end of the spectrum are the smaller venues:
Seattle Childrens Museum 200,000
MOHAI 60,000
Burke 50,000
Everett Childrens Museum 50,000
Odyssey Museum 40,000
Tacoma Childrens Museum 33,000
Annual Admissions
It is difficult to project attendance for the carousel museums around the country,
as many do not track admission. Instead, they track the number of rides sold:
Indianapolis, IN 400,000
Spokane 290,000
Missoula, MT 220,000
Salem, OR 215,000
Mansfield, OH 170,000
Helena, MT 98,000
Ride Tickets Sold
For our baseline projections for IMCA in Renton, we again distinguish between
the children-oriented, pay-as-you-ride visitor and the carousel museum visitor.
Based on the best information available, we use the following estimates for
attendance during the fourth year of operations:
Museum Admissions 57,200
Carousel Only Admissions 74,360
Membership Admissions 5,200
Total Attendance 156,760
Paid Carousel Rides 148,720
Total Carousel Rides 231,120
So for the museum component, we are projecting attendance similar to the
Burke, MOHAI and the Odyssey Museum, and considerably less than the Seattle
Children's' Museum. In terms of rides sold,we project about 149,000 rides,
which is significantly lower than any of the carousel museums, even though they
•are all in much smaller markets (except Indianapolis). But when the
membership rides are factored in, the total is around 170,000 rides, which is
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closer to the other carousel venues. By adding rides taken by the museum
visitors, we reach a total of 230,000 rides. Since most of the other carousel
venues don't have a museum component, at least some of these rides represent
customers they would not get.
2. Membership
People who bring their children often, or some people who simply want to
support the carousel museum, will choose to purchase an annual membership
instead of paying each time. The membership is good for admission to the
museum, as well as.unlimited rides on the carousel, for one year.
Memberships at the Woodland Park Zoo and Aquarium number over 30,000.
Very few of the carousel museums have memberships. The museum at
Sandusky, OH counts 700 members, but it is principally a tourist museum, where
guests come only once or,twice a year at most. The carousel at Salem, OR,
recently started selling memberships, and after nine months, is selling them at a
rate of 70 per month.
For our projections, we are using 2000 family memberships per year, plus 200
individual memberships (intended primarily for one child households). These
2200 members contribute'25,000 trips to the total attendance figures, or roughly
one sixth of the total.
3. Ticketing •
Ticket prices are probably:the most conservative element in our assumptions.
When you enter the facility, you have the option of two ticket plans. If you wish to
visit the museum side, you must pay for admission, but all carousel rides are
• free. The admission prices are $7.00 for adults and $3.50 for children, which is
the lowest of all of the twelve attractions surveyed and compared on Exhibit 3,
the Admission Fee Comparison, except for the smaller children's museums.
If instead, you are not interested in the museum, and only want your children to
ride the carousel, you can buy individual ride tickets for$1.50 each. In our
carousel survey, ticket prices typically ranged from$1.00 to $2.00.
We believe that the museum admission could be raised to $8.00, and the ride fee
be raised to $2.00, without significant reductions in attendance.
4. Impact on Parking
No new parking construction is proposed as part of this business plan. In fact,
one of the significant advantages of the site is the existence of the City parking
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structure to the north. With approximately 200 visitors during weekdays and
perhaps 600 on busy weekends, the parking demand is likely to be for 30-50
parking spaces during the week and 75-125 spaces on weekends. The garage
has ample capacity to provide these stalls.
Because most of the visitors will arrive on the weekends or in the evening, we do
not expect that the museum guests will take parking spaces away from
commuters using the transit system.
We do not expect visitors to the museum and carousel to stay for more than two
hours, so the parking may not generate much parking revenue. Perhaps 25% of
the visitors could stay long enough to have to pay for part of their parking. A
greater opportunity for City revenues comes with the banquet operations. In this
case, visitors are expected to stay for more than two hours. With 50 events per
year averaging 150 guests, and a parking fee of$2.00, the City might generate
between $5,000 and $7,500 per year in parking fees.
D. Marketing
The budget carries$30,000 per year for media and advertising,which is as high
as the highest marketing budget for other pure carousel operations. The
marketing plan should address distinct efforts for each of the two principal
customers: the carousel/museum enthusiast and the parent with kids.
Elements of the marketing plan will include the following:
• Free television and newspaper coverage on Opening. IMCA has
demonstrated great success in previous openings to receive extensive
coverage.
• Free, discounted and co-op ride tickets. These may go out in the City's utility
bills, be given away by sponsors such as Ikea, or be included in co-op
advertising in newspapers and parents' magazines.
• Paid and co-op advertising in periodicals such as Seattle's Child, which has
already expressed an interest in a co-op program.
• Advertising and collateral materials focused on the tourist market. This
business tends to build slowly.
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5. FINANCIAL PERFORMANCE
A. Operating Income —Optimal Model
The "optimal"financial model (pf 041101 base.xls) shows total gross income of
around $900,000 once the facility is established. In the third year of operations,
this income is distributed as follows:
Attendance income: $267,228 31.3%
Family Pass income: $90,000 10.5%
Indiv. Memb. income: $5,400 0.6%
Ride income: $214,500 25.1%
Catering Income: $18,750 2.2%
Birthday/Banquet income: $58,240 6.8%
Food Service:1 $72,830 8.5%
Gift Store: i $72,830 8.5%
Sponsorships:' $20,000 2.3%
Grants: $15,000 1.8%
Donations: $20,000 • 2:3%
Total Gross Income: $854,778 •
The carousel ride income, including the family memberships, is comparable to
the income of the pure carousel operations in Spokane, Salem, Missoula and •
Helena, but they do not have a museum component, which adds$300,000 per
year in Renton.
The sponsorship category generates only 6% of the total revenues in this model.
This number could be significantly increased with an aggressive community
program, but the costs of staffing and administration would also increase.
Typically, a non-profit will generate 30 to 40% of its revenues through fund-
raising programs.
B. Operating Income — Perron Model
The"Perron"financial model (pf 041101 duane.xls) shows total gross income of
around $700,000 once the facility is established. In the third year of operations,
this income is distributed as follows:
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Attendance income: $237,536 33.4%
Family Pass income: $70,000 9.9%
Indiv. Memb. income: $4,200 0.6%
Ride income: $214,500 30.2%
Catering Income: $15,000 2.1%
Birthday/Banquet income: $46,592 6.6%
Food Service: $33,725 4.7%
Gift Store: $33,725 4.7%
•
Sponsorships: $20,000 2.8%
Grants: $15,000 2.1%
Donations: $20,000 2.8%
Total Gross Income: $710,278
The"Perron" model was based on the "Optimal" model, but the following
changes were made to the income side to adjust the projections:
The growth rates for the income categories are lowered in the"Perron"model as
illustrated below:
Optimal model:
Growth Rate Categories: 2005 2006 2007 2008 •
Museum Admissions: 40% 70% 90% 100%
Carousel Only Admissions: 60% 90% 100% 104%.
Annual Family Passes: 40% 70% 90% 100%
Annual Indiv. Memb: 40% 70% 90% 100% •
Paid Carousel Rides: 60% 90% 100% 104%
Birthday/Banquet income: 50% 80% 100% 104%
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'/
Perron model:
Growth Rate Categories: 2005 2006 2007 2008
Museum Admissions: 40% 50% 60% 65%
Carousel Only Admissions: 60% 80% 100% 104%
Annual Family Passes: 40% 60% 70% 80%
Annual lndiv. Memb: 40% 60% 70% 80%
Paid Carousel Rides: 60% 80% 100% 104%
Birthday/Banquet income: 50% 70% 80% 83%
In the Perron model, museum attendance levels never reach the level of the
Optimal model, and the party and banquet revenues grow much more slowly.
Both models suffer from low first attendance, and it should be noted that our
projections run counter to the experience of most museum facilities. For most
museums, the first year is their best, and attendance falls slightly thereafter. It
often takes five or more years to reach the first year attendance once more.
We could increase the first year attendance numbers, and improve the overall
performance of both models, by increasing the first-year marketing budgets •
significantly. The Rosalie Whyel Doll Museum, for example, spent $150,000 on
marketing in the first year, and saw attendance of 47,000 people. We are
projecting only $30,000 in media spending, and project museum attendance of
just over 20,000. Our models reflect the Perrons' conservatism, and their
reluctance to raise the funds needed for marketing the project.
As illustration, we ran an additional model to reflect the results of a higher initial
marketing expenditure. Using a budget of$150,000 in the first year instead of
the$60,000 that is in the Optimal and Perron models, we projected that the first
year attendance would be 90% of the Design Year rather than the 40% in the
Perron model. This increase eliminated all operating shortfalls, producing a
modest.$14,000 of net income in the first year. (See"Hybrid Model": pr 041129
hybrid.xls).
C. Operating Expense Comparison
Annual operating expenses in the Perron model are roughly $100,000 below the
Optimal model. The principal changes are as follows:
• Janitorial costs reduced.
• Educational program costs reduced.
• Food and Gift revenues and expenses cut in half.
• Percentage rent reduced due to lower revenues.
•
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D. The Bottom Line: NOI
There is a dramatic difference between the two models when you get to the Net
Operating Income line. The Optimal model shows annual net income of over
$150,000, (average income over years 3-6), which provides both income to
further improve the facility and the experience, as well as serve as a cushion
against downturns.
The Pen-on model, on the other hand, shows positive net income of$30,000 to
$40,000, (average income over years 3-6), but only after sustaining losses of
$150,000 in the early years. It takes ten years to repay the initial capital and
operating loans, so that the facility has excess funds to invest.in programs.
Given that the net income is only 5% of the gross income, there is no room for
error in the projections or the operation.
NOI Comparison 2005 2006 2007 2008 2009 2010 2011
Optimal Model -$111,026 $59,296 $138,957 $165,807 $139,472 $151,772 $165,034
Perron Model -$105,481 -$47,217 $6,976 $18,740 $25,977 $31,264 $37,096
Hybrid Model $14,907 $14,384 $46,201 $57,720 $64,704 $72,575 $81,154
6. OTHER ISSUES
A. Governance
The City would enter into a lease with the International Museum of Carousel Art,
IMCA, which is a 501.c.3 corporation. This is the same entity that operates the
museum in Hood River. It has a board of directors of which Duane Perron is the
Chairman. The board might be expanded in light of the Renton obligations, but
that has not been decided.
The Perrons own the collection, which would be loaned to IMCA as previously
described.
Historic Carousels is the for-profit corporation the Perrons use for their carousel
operations around the country. It is managed by their son, Brad Perron. It is
likely that IMCA would sub-contract the carousel operations and maintenance to
Historic Carousels, and that the operators may be Historic Carousel employees.
International Museum of Carousel Art—Business Plan
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7. TABLES AND EXHIBITS
1. Preliminary Building Layout
2. Banquet Layout
3. Admission Fee Comparison
4. "Optimal" Financial Projection
"Optimal" Staffing Assumptions
"Optimal" Pre-Opening Capital Budget
5. "Perron" Financial Projection
"Perron" Staffing Assumptions
"Perron" Pre-Opening;Capital Budget
6. "Hybrid" Financial Projection
"Hybrid" Staffing Assumptions
"Hybrid" Pre-Opening Capital Budget
7. Comparable Facilities Data
'1. International Museum of Carousel Art—Business Plan
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EXHIBIT 1
BUILDING LAYOUT
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PARKING AND FUTURE
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BANQUET LAYOUT
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EXHIBIT 3
ADMISSION FEE COMPARISON
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International Museum of Carousel Art
Renton Exhibition Facility
Admission Fee Comparison
Venue . Adult Child Child, Grp Seniors Free, Age
Renton Carousel $7.00 $3.50 $2.00 $6.00 0-2
Museum of Flight $12.00 $7.50 $6.50 $11.00 0-4
MOHAI $7.00 $5.00 $5.00 0-4
Seattle Children's Museum $7.50 $7.50 $6.50. under 1
Experience Music Project $19.95 $14.95 $15.95 0-6
Wing Luke Asian Museum $11.00 $2.00 $3.00
Pacific Science Center $10:00 $7.00 $9.00 0-2
Odyssey Museum $7.00 $5.00 $5.00 0-2
Tacoma History Museum $7.00 $5.00 $4.00 $6.50 0-5
Factoria Childrens Museum $3.00 $3.00
Everett Childrens Museum $5.00 $5.00 0-2
Olympia Childrens Museum $6.50 $3.50 0-1
Tacoma Childrens Museum $3.50 $4.50 0-1
admiss fee comp 041020.xls , Ravenhurst Development, Inc.
admiss 11/30/2004 Page 1
EXHIBIT 4
"OPTIMAL" FINANCIAL MODEL
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;;. International Museum of Carousel Art—Business Plan
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International Museum of Carousel Art
Renton Exhibition Facility
2007 Attendance: Weekday Wkend day
Assumptions: Gift Sales/visitor: $0.50 • Museum: Std. Adult 40 130
Admission Fees: Food Sales/visitor: $0.50 Group Adu 10 40
Std. Adult $7.00 Std. Child 40 130
Group/Sr Adult $6,00 Visits/Family Pass: • 12 Group Chil 10 0
Std. Child $3.50 Visits/Membership: 6 100 300
Group Child $2.00
Family Pass $50,00 Free Rides/Museum Admission: 1.5 Banquet Parties/wk 1 ,
Individual Pass $30.00 Paid Rides/Museum Admission: 0 Birthday Parties/wk 8
Other $0.00 Large Function Rate $800 Rides Museum 15.0 450
Ride Fee: $1.50 • Birthday-Party-Rate:- -- --- --$40--- - Mus. Extra 0 0
Paid Rides/Carousel Only Visitor 2 Paid 250 750
Annual Operating Projections
2005 2006 2007 2008 2009 2010 2011 ' 2012 2013 2014
Annual Attendance:
Museum Admissions: 22,880 40,040 51,480 57,200 61,204 64,876 68,769 72,895 77,269 81,905
Carousel Only Admissions: 42,900 64,350 71,500 74,360 77,334 80,428 83,645 86,991 90,470 94,089
Annual Family Passes: 2000 9,600 16,800 21,600 24,000 24,960 25,958 26,997 28,077 .29,200 30,368
( Annual Indiv. Memb: 200 480 840 1,080 1,200 1,248 1,298 1,350 1,404 1,460 1,518
Total Attendance: 75,860 122,030 145,660 156,760 164,746 172,560 180,760 189,366 198,399 207,880
Total Carousel Rides: 118,760 186,380 217,160 231,120 242,081 252,988 264,405 276,357 288,869 301,969
Paid Carousel Rides: 85,800 128,700 143,000 148,720 154,669 160,856 167,290 173,981 180,941 188,178
Income and Expense Summary
Total Gross Income: 464,223 713,716 854,778 917,830 962,966 1,006,863 1,052,971 1,101,404 1,152,286 1,205,745
Total Operating Expenses: -575,249 -654,420 -715,821 -752,023 . -823,494 -855,091 -887,937 -922,085 -957,592 -994,517
Net Operating Income: -111,026 59,296 138,957 165,807 139,472_ 151,772 165,034 179,319 194,694 211,228
Paid into Reserves: 0 50,000 0 0 0 0 0 0 0 0
Capital Loan Repayment: 0 9,296 92,704 0 0 0 0 0 0 0
Operating Loan Repayment: 0 0 46,253 64,772 0 0 0 ' 0 0 0
Carousel Rental: 0 0 0 . 0 0 0 0 0 0 0
IMCA Programs: 0 0• 0 101,035 139,472 151,772 165,034 179,319 194,694 211,228
pf 041108 base.xls Ravenhurst Development, Inc.
income 11/29/2004 Page 1
•
International Museum of Carousel Art •
Renton Exhibition Facility
Attendance Growth Rates: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Museum Admissions: 40% 70% 90% 100% 107% 113% 120% 127% 135% 143%
Carousel Only Admissions: 60% 90% 100% 104% 108% 112% 117% 122% 127% 132%
Annual Family Passes: 40% 70% 90% 100% 104% 108% 112% 117% 122% 127%
Annual Indiv. Memb: 40% 70% 90% 100% 104% 108% 112% 117% 122% 127%
Paid Carousel Rides: 60% 90% 100% 104% 108% 112% 117% 122% 127% 132%
Birthday/Banquet income: 50% 80% 100% 104% 108% 112% 117% 122% 127% 132%
Income: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Attendance income: 118,768 207,844 267,228 296,920 317,704 336,767 356,973 378,391 401,094 425,160
Family Pass income: 40,000 70,000 90,000 100,000 104,000 108,160 112,486 116,986 121,665 126,532
Indiv. Memb. income: 2,400 4,200 5,400 6,000 6,240 6,490 6,749 7,019 7,300 7,592
Ride income: 128,700 193,050 214,500 223,080 232,003 241,283 250,935 260,972 271,411 282,267
Catering Income: 18,750 9,375 15,000 18,750 19,500 20,280 . 21,091 21,935 22,812 23,725 24,674
20,800 33,280 41,600 43,264 44,995 46,794 48,666 50,613 52,637 54,743
Birthday/Banquet income: 8,320 13,312 16,640 17,306 17,998 18,718 19,466 20,245 21,055 21,897
Subtotal: income subj. to % rent: 328,363 536,686 654,118 706,070 743,220 779,303 817,210 857,038 898,888 942,865
Concession income:
Food Service: 37,930 61,015 72,830 78,380 82,373 86,280 90,380 94,683 99,199 103,940
Gift Store: 37,930 61,015 72,830 78,380 82,373 86,280 90,380 94,683 99,199 103,940
Sponsorships: 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000
Grants: 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000
•
Donations: 25,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000
Total Gross Income: 464,223 713,716 854,778 917,830 962,966 1,006,863 1,052,971 1,101,404 1,152 286 1,205,745
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income 11/29/2004 Page 2
International Museum of Carousel Art
Renton Exhibition Facility
Expense: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Rent: 9595 sf $4.39 $9.81 $12.87 $14.23 $15.20 $16.14 $17.12 $18.16 $19.25 $20.40
Percentage Rent: 42,091 94,172 123,530 136,517 145,805 154,826 164,303 174,260 184,722 195,716
Less Marketing Contribution: 0 0
Other Payments to Landlord:
Leasehold tax: $0.75 7,196 7,412 7,635 7,864 8,099 8,342 8,593 8,850 9,116 9,389
Exterior CAM: $0.00 0 0 0 0 0 0 0 0 0 0 w.
Insurance: $0.50 4,798 4,941 5,090 5,242 5,400 5,562 5,728 5,900 6,077 6,260
Escalation: - 3.0% - -
Operations Personnel:
Salaries: 100,000 103,000 106,090 109,273 112,551 115,927 119,405 122,987 126,677 130,477
Benefits: 32% 30,000 32,960 33,949 34,967 36,016 37,097 38,210 39,356 40,537 41,753
Curatorial Expense: 20,000 21,000 22,050 23,153 24,310 25,526 26,802 28,142 29,549 31,027
Marketing/Development:
Salaries: 80,000 82,400 84,872 87,418 113,644 117,053 120,565 124,181 127,907 131,744
Benefits: 32% 30,000 30,900 31,827 32,782 42,616 43,895 45,212 46,568 47,965 49,404
Media: 30,000 30,900 31,827 32,782 42,616 43,895 45,212 46,568 47,965 49,404
Membership: 20% 21,200 14,840 19,080 21,200 22,048 22,930 23,847 24,801 25,793 26,825
Operations:
Utilities: 18,000 18,540 19,096 19,669 20,259 20,867 21,493 22,138 22,802 23,486
Supplies: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Repairs and Maint.: 12,000 12,360 12,731 13,113 13,506 13,911 14,329 14,758 15,201 15,657
Janitorial contract: 20,000 . 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 •
Security contract:
Monitoring: • 6,000 6,180 6,365 6,556 6,753 6,956 7,164 7,379 7,601 7,829
Equipment: 2,000 2,060 2,122 2,185 2,251 2,319 . 2,388 2,460 2,534 2,610
Phone 5,000 5,150 5,305 5,464 5,628 5,796. 5,970 6,149 6,334 6,524
Education and Docent programs: 14,000 14,420 14,853 15,298 15,757 16,230 16,717 17,218 17,735 18,267
Payroll Administration: 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668 13,048
Professional Fees: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Misc. Expense: 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668 13,048
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income 11/29/2004 • . . Page 3
•
International Museum of Carousel Art
Renton Exhibition Facility
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
•
Exhibit Costs:
Lighting/Displays: 0 5,000 5,150 5,305 5,464 5,628 5,796- 5,970 6,149 6,334
Seasonal/Special Exhibits: 10,000 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668
Maintenance/Repair: 0 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335
Transport: 0 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334
Insurance:
Liability: 7% 9,009 13,514 15,015 _ 15,616 16,240 16,890 1.7,565 1.8,268 18,999 _ 19,759
Property: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Cost of Goods Sold:
Food: 40% 30,780 24,406. 29,132 31,352 32,949 34,512 36,152 37,873 39,680 41,576
Gifts: 60% 46,170 36,609 43,698 47,028 49,424 51,768 54,228 56,810 59,520 62,364
Total Operating Expenses: 575,249 654,420 715,821 752,023 823,494 855,091 887,937 922,085 957,592 994,517
Net Operating Income: -111,026 59,296 138,957 165,807 139,472 151,772 165,034 179,319 194,694 211,228
Capital Investment: -620,000 0 0 0
Tenant Allowance from City: 109,000
Initial Sponsorships 203,000
In-Kind Contributions 125,000
Funded by IMCA 81,000
Loan from City 51,000
Loan from Perrons 51,000
Net Cash Flow: -111,026 59,296 138,957 165,807 139,472 151,772 165,034 179,319 194,694 211,228
pf 041108 base.xls Ravenhurst Development, Inc.
income 11/29/2004 Page 4
International Museum of Carousel Art
Renton Exhibition Facility
Cash Flow Distributions: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Net Cash Flow from Operations -111,026 59,296 138,957 165,807 139,472 151,772 165,034 179,319 194,694 211,228
Reserve Balance: 0 0 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000
Applied to Reserves: 0 50,000 0 0 0 0 0 0 0 • 0
Available for Loan Reduction: 0 9,296 138,957 165,807 139,472 151,772 165,034 179,319 194,694 211,228 ',(
_ _ Year-End Capital Loan Balances:
City: -51,000 -51,000 -46,352 0 0 0 0 0 0 0 0
Perror -51,000 -51,000 -46,352 0 0 0 0 0 0 0 0
Applied to Capital Loan Reducl 0 9,296 92,704 0 0 0 0 0 0 0
Available for Operating Loan Reduction: 0 46,253 165,807 139,472 151,772 165,034 179,319 194,694 211,228
Year-End Operating Loan Balances:
City: 0
Perror 0 -111,026 -111,026 -64,772 0 0 0 0 0 0 0
Applied to Operating Loan Reduction: 0 46,253 64,772 - 0 0 0 0 0 0
Available for Collection Rental: 0 0 0 101,035 139,472 151,772 165,034 179,319 194,694 211,228 i� j
Collection Rental: 0 0 0 0 0 0 0 0 0 0
Available for IMCA Programs: 0 0 0 101,035 139,472 151,772 165,034 179,319 194,694 211,228
Renton Facility Upgrade: 0 0 0 30,000 42,000 46,000 50,000 54,000 58,000 63,000
IMCA Collection Restoration: 0 0 0 20,000 28,000 30,000 33,000 36,000 39,000 42,000
IMCA Acquisition Fund: 0 0 0 51,000 70,000 76,000 83,000 90,000 97,000 106,000
pf 041108 base.xls Ravenhurst Development, Inc.
income 11/29/2004 Page 5
International Museum of Carousel Art .
Renton Exhibition Facility
Staffing Projections:
IMCA Management: Years 1-5 $0
Years 6-10 $0
Operations Personnel: 32%
Summer Hours: Staffing Hourly wage Hours/Day Days Wages Burden Total
Manager 1 $16.00 10 150 $24,000 $7,680 $31,680
Operators 3 $8.00 10 150 $36,000 $11,520 $47,520
•
Winter Hours:
Manager 1 $16.00 6 210 $20,160 $6,451 $26,611
Operators 2 $8.00 6 210 $20,160 $6,451 $26,611
$100,320 $32,102 $132,422
Rounded $100,000 $30,000 $130,000 7 -`
)
Marketing/Membership/Development Personnel:
Manager: 1 $50,000 $50,000 $16,000 $66,000
Events Coordin 1 $34,000 $34,000 $10,880 $44,880
$84,000 $26,880 $110,880
Rounded $80,000 $30,000 $110,000
pf 041108 base.xls Ravenhurst Development, Inc.
Personnel ( 11/30/2004 Page 1
International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. Item
Collection & Exhibits
Artifacts $3,000;000
000
Ferris Wheel $40,000 ( ,
Carousel $750,000 .
Band Organ $50,000
Miniatures • $12,000
Total Exhibit Value: $3,852,000
Design and Project Management $40,000 $20,000 •
Initial Moving Expense $40,000 $40,000
$40,000 .
Building Systems
Floor Modifications: $10,000 $10,000
Building Security $20,000 $10,000 $10,000
HVAC Modifications $5,000 $3,000
Life Safety Systems $2,000 $2,000
Sound System $2,000 $2,000
Locks and Crash Bars $5,000 $5,000 \__
Exterior Lighting $5,000 $5,000
$49,000 •
Interior Construction
Misc. Demising Partitions $5,000 $5,000
Party Room Construction $10,000 $10,000
Catering Kitchen $10,000 $5,000
Office Construction $2,000 $2,000
Stairs and Railings $10,000
Ticket/Info Counter $5,000
pf 041108 base.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 Page 1
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International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By y Perron/IMCA T. I. Pack Contrib. Item
Food and Gift Areas $4,000 $2,000
$46,000
Exhibits 0
Exhibit Lighting $75,000 $25,000
Carousel Platform $30,000 $10,000 $10,000 __
Casework $10,000 • $2,000 $8,000
Dividers, Stantions $20,000 ._ $10,000 - $10,000
Exhibit Staging $20,000 $10,000 $5,000
Misc. Staging $30,000
Window Treatments $5,000
$190,000
Signage
Exterior Signage $30,000 $5,000 $5,000
Display Graphics $5,000 $5,000
Parking Garage Signage $6,000
City Directional Signage $5,000 $5,000
$46,000
Operations
Gift Store Fixtures $2,000 $2,000
Food Service-Equipment $5,000 $2,000 $3,000
Computers, Admin Equipt. $5,000 $5,000
Uniforms and Supplies $2,000
•
$14,000
Marketing .
Six Months prior to Opening
Advertising $30,000 $15,000 $15,000
Printing and Materials $5,000 $2,500 $2,500
Events $5,000 $2,500 $2,500
$40,000
pf 041108 base.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 Page 2
•
International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. Item
Pre-Opening Staffing
Marketing Staff $60,000
Operations Staff $20,000
Management $25,000 $25,000
$105,000
•
Contingency $50,000
Non-Item-Specific Sponsorhip $30,000 $135,000
Total First Year Capital Budget: $620,000 $81,000 $74,000 $125,000 $203,000
Contributed by IMCA/Perron: $81,000
Funded by City as Tenant Improvements: $74,000
Funded by City as Cash Contribution: $35,000
In-Kind Contributions: $125,000
Funded by Sponsorships: $203,000
•
Loan from Perrons: $51,000
Loan from City: $51,000
•
pf 041108 base.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 Page 3
EXHIBIT 5
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International Museum of Carousel Art—Business Plan
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Ravenhurst Development, Inc.
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11/29/04
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•
International Museum of Carousel Art PERRON MODEL
Renton Exhibition Facility
2007 Attendance: Weekday Wkend day
Assumptions: Gift Sales/visitor: $0.25 Museum: Std. Adult 40 130
Admission Fees: Food Sales/visitor: $0.25 Group Adu 10 40
Std.Adult $7.00 Std. Child 40 130
Group/Sr Adult $6.00 Visits/Family Pass: 12 Group Chil 10 0
Std. Child $3.50 Visits/Membership: 6 100 300
Group Child $2.00
Family Pass $50.00 Free Rides/Museum Admission: 1.5 Banquet Parties/wk 1
Individual Pass $30.00 Paid Rides/Museum Admission: 0 Birthday Parties/wk 8 ,
Other $0.00 Large Function Rate $800 Rides _ Museum 150 450
Ride Fee: $1.50 Birthday Party Rate: $40 Mus. Extra 0 0
Paid Rides/Carousel Only Visitor • 2 Paid 250 750
Annual Operating Projections
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Annual Attendance:
Museum Admissions: 22,880 28,600 34,320 37,180 40,040 42,442 44,989 47,688 50,550 53,583
Carousel Only Admissions: 42,900 57,200 71,500 74,360 77,334 80,428 83,645 86,991 90,470 94,089
Annual Family Passes: 2000 9,600 14,400 16,800 19,200 19,968 20,767 21,597 22,461 23,360 24,294
Annual Indy. Memb: 200 480 720 840 960 998 1,038 1,080 1,123 1,168 1,215
Total Attendance: 75,860 100,920 123,460 131,700 138,341 144,675 151,311 158,263 165 548 173,181
Total Carousel Rides: 118,760 158,120 194,960 206,060 215,675 225,103 234,956 245,254 256,018 267,270
Paid Carousel Rides: 85,800 114,400 143,000 148,720 154,669 160,856 167,290 173,981 180,941 188,178
Income and Expense Summary
Total Gross Income: 426,293 543,013 645,174 685,784 718,828 749,938 782,566 816,789 852,689 890,350
Total Operating Expenses: -531,774 -590,230 -638,198 -667,044 -692,851 -718,674 -745,470 -773,278 -802,139 . -832,097
Net Operating Income: -105,481 -47,217 6,976 18,740 25,977 31,264 37,096 43,512 50,550 58,253
Paid into Reserves: 0 -47,217 6,976 18,740 25,977 31,264 14,260 0 0 0
Capital Loan Repayment: 0 0 0 0 0 0 19,000 7,582 0 0
Operating Loan Repayment: 0 0 0 0 0 0 3,837 35,930 50,550. 15,164
Carousel Rental: 0 0 0 0 0 0 0 0 0 0
IMCA Programs: 0 0 0 . 0 0 0 . 0 0 0 43,089
pf 041109 duane.xis Ravenhurst Development, Inc.
income 11/30/2004 Page 1
•
•
International Museum of Carousel Art PERRON MODEL.
Renton Exhibition Facility
Attendance Growth Rates: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Museum Admissions: 40% 50% 60% 65% 70% 74% 79% 83% 88% 94%
Carousel Only Admissions: 60% 80% 100% 104% 108% 112% 117% 122% 127% 132%
Annual Family Passes: 40% 60% 70% 80% 83% 87% 90% 94% 97% 101%
Annual Indiv. Memb: 40% 60% 70% 80%. 83% 87% 90% 94% 97% 101%
Paid Carousel Rides: 60% 80% 100% 104% 108% 112% 117% 122% 127% 132%
Birthday/Banquet income: 50% 70% 80% 83% 87% 90% 94% 97% 101% 105%
Income: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Attendance income: 118,768 148,460 178,152 192,998 207,844 220,315 233,534 247,546 262,398 278,142
Family Pass income: 40,000 60,000 70,000 80,000 83,200 86,528 89,989 93,589 97,332 101,226
Indiv. Memb. income: - 2,400 3,600 4,200 4,800 4,992 5,192 5,399 5,615 5,840 6,074
Ride income: - 128,700 171,600 214,500 223,080 232,003 241,283 250,935 260,972 271,411 282,267
Catering Income: 18,750 9,375 13,125 15,000 15,600 16,224 16,873 17,548 18,250 18,980 19,739
Banquet Income: 20,800 29,120 • 33,280 34,611 35,996 37,435 38,933 40,490 42,110 43,794
Birthday Room Income: 8,320 11,648 13,312 13,844 14,398 14,974 15,573 16,196 16,844 17,518
Subtotal: income subj. to % rent: 328,363 437,553 528,444 564,934 594,657 622,600 651,911 682,658 714,915 748,759
Concession income:
Food Service: 18,965 25,230 30,865 32,925 34,585 36,169 37,828 39,566 41,387 43,295
Gift Store: 18,965 25,230 30,865 32,925 34,585 36,169 37,828 ; 39,566 41,387 43,295
Sponsorships: 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000
Grants: 15,000 '15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000
•
Donations: 25,000 20,000 20,000 20,000 . 20,000 20,000 20,000 20,000 20,000 20,000
Total Gross Income: 426,293 543,013 645,174 685,784 718,828 749,938 782,566 816,789 852,689 890,350
pf 041109 duane.xis Ravenhurst Development, Inc. . . .
Income 11/30/2004 Page 2
•
•
International Museum of Carousel Art PERRON MODEL -
Renton Exhibition Facility
Expense: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Rent: 9595 sf $4.39 $7.23 $9.60 $10.55 $11.33 $12.05, $12.82 $13.62 $14.46 $15.34
Percentage Rent: 42,091 69,388 92,111 101,233 108,664 115,650 122,978 130,664 138,729 147,190
Less Marketing Contribution: 0 0
Other Payments to Landlord:
Leasehold tax: $0.75 7,196 7,412 7,635 7,864 8,099 8,342 8,593 8,850 9,116 9,389
Exterior CAM: $0.00 0 0 0 0 0 0 - 0 0 0 0 r
---- -- - - Insurance: _ $0.50 4;798 4,941 5,090 5,242 . 5,400 5,562 5,728 5,900 6,077 6,260
Escalation: 3.0%
•
Operations Personnel:
Salaries: 100,000 103,000 106,090 109,273 112,551 115,927 119,405 122,987 126,677 130,477
Benefits: 32% 30,000 32,960 . 33,949 34,967 . 36,016 37,097 38,210 39,356 40,537 41,753
Curatorial Expense: 20,000 21,000 22,050 23,153 24,310 25,526 26,802 28,142 29,549 31,027
Marketing/Development:
Salaries: 80,000 82,400 84,872 87,418 90,041 92,742 95,524 98,390 101,342 104,382
Benefits: 32% 30,000 30,900 31,827 32,782 33,765 34,778 35,822 36,896 38,003 39,143
Media: 30,000 30,900 31,827 32,782 33,765 34,778 35,822 36,896 38,003 39,143
Membership: 20% 21,200 12,720 14,840 16,960 17,638 18,344 19,078 19,841 20,634 21,460
Operations:
Utilities: 18,000 18,540 19,096 19,669 20,259 20,867 21,493 22,138 22,802 23,486 _
Supplies: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Repairs and Maint.: 12,000 12,360 12,731 13,113 13,506 13,911 14,329 14,758 15,201 15,657
-Janitorial contract: 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 .
Security contract: -
Monitoring: 6,000 6,180 6,365 6,556 6,753 6,956 7,164 7,379 7,601 7,829
Equipment: 2,000 2,060 2,122 2,185 2,251 2,319 2,388 2,460 2,534 2,610
Phone 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Education and Docent programs: 14,000 14,420 14,853 15,298 15,757 16,230 16,717 17,218 17,735 18,267
Payroll Administration: 10,000 10,300 10,609 . 10,927 11,255 11,593 11,941 12,299 12,668 13,048
Professional Fees: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Misc. Expense: 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668 13,048
pf 041109 duane.xlsRavenhurst Development, Inc. .
income - •
11/30/2004 Page 3
International Museum of Carousel Art 0 PERRON MODEL
Renton Exhibition Facility
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Exhibit Costs:
Lighting/Displays: 0 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334
Seasonal/Special Exhibits: 5,000 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668
Maintenance/Repair: 0 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335
Transport: 0 , 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334
Insurance:
Liability: 7% 9,009 12,012 15,015 15,616 16,240 16,890 17,565 18,268 18,999 19,759
Property: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Cost of Goods Sold:
Food: 40% 15,390 10,092 12,346 13,170 13,834 14,468 15,131 15,826 16,555 17,318
Gifts: 60% 23,085 15,138 18,519 19,755 20,751 21,701 22,697 23,739 24,832 25,977
Total Operating Expenses: 531,774 590,230 638,198 667,044 692,851 718,674 745,470 773,278 802,139 832,097
Net Operating income: -105,481 -47,217 6,976 18,740 25,977 31,264 37,096 43,512 50,550 58,253
Capital Investment: -345,000 0 0 0
Tenant Allowance from City: 115,000
Initial Sponsorships 70,000
In-Kind Contributions 84,000 •
Funded by IMCA 57,000
Loan from City 0
Loan from Perrons 19,000
Net Cash Flow: -105,481 -47,217 6,976 18,740 25,977 31,264 37,096 43,512 50,550 58,253
•
pf 041109 duane.xls Ravenhurst Development, Inc.
income 11/30/2004 Page 4
•
International Museum of Carousel Art PERRON MODEL
Renton Exhibition Facility
Cash Flow Distributions: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Net Cash Flow from Operationf -105,481 -47,217 6,976 18,740 25,977 31,264 37,096 43,512 50,550 58,253
Reserve Balance: 0 0 -47,217 -40,241 -21,500 4,476 35,740 50,000 50,000 50,000
Applied to Reserves: 0 -47,217 6,976 18,740 25,977 31,264 14,260 0 0 0
Available for Loan Reduction: 0 0 0 0 0 0 22,837 43,512 50,550 58,253 \ `,
Year-End Capital Loan Balances:
City: 0 0 0 . 0 0 0 0 0 0 0 0
Perror -19,000 -19,000 -19,000 -19,000 -19,000 -19,000 -19,000 -7,582 0 0 0
Applied to Capital Loan Reducl 0 0 0 0 0 0 19,000 7,582 0 0
Available for Operating Loan Reduction: 0 0 0 0 0 3,837 35,930 50,550 58,253
Year-End Operating Loan Balances:
City: 0
Perror 0 -105,481 -105,481 -105,481 -105,481 -105,481 -105,481 -101,644 -65,714 -15,164 0
Applied to Operating Loan Reduction: 0 0 . 0 0 0 3,837 35,930 50,550 15,164
Available for Collection Rental: 0 0 0 0 0 0 0 0 0 43,089
Collection Rental: 0 0 0 0 0 0 0 0 0 0
Available for IMCA Programs: 0 0 0 0 0 0 0 . 0 0 43,089
Renton Facility Upgrade: . - 0 0 0 0 0 0 0 0 0 13,000
•
IMCA Collection Restoration: 0 0 0 0 0 0 0 0 0 9,000
IMCA Acquisition Fund: 0 0 0 0 0 0 0 0 0 22,000
•
pf 041109 duane.xls Ravenhurst Development, Inc.
income • 11/30/2004 . • Page 5
International Museum of Carousel Art .
Renton Exhibition Facility
Staffing Projections:
!MCA Management: Years 1-5 $0
Years 6-10 $0
Operations Personnel: 32%
Summer Hours: Staffing Hourly wage Hours/Day Days Wages Burden Total
Manager 1 $16.00 10 150 $24,000 $7,680 $31,680
Operators 3 $8.00 10 150 $36,000 $11,520 $47,520
Winter Hours:
Manager 1 $16.00 6 210 $20,160 $6,451 $26,611
Operators 2 $8.00 6 210 $20,160 $6,451 $26,611
$100,320 $32,102 $132,422
Rounded $100,000 $30,000 $130,000
Marketing/Membership/Development Personnel:
Manager: 1 $50,000 $50,000 $16,000 $66,000
Events Coordin 1 $34,000 $34,000 $10,880 $44,880
$84,000 $26,880 $110,880
Rounded $80,000 $30,000 $110,000 I •
pf 041109 duane.xis Ravenhurst Development, Inc. .
Personnel 11/30/2004 Page 1.
International Museum of Carousel Art .
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. Item •
Collection & Exhibits
Artifacts $3,000,000
Ferris Wheel $40,000
Carousel $750,000
•
Band Organ , $50,000
Miniatures $12,000
Total Exhibit Value: $3,852,000
Design and Project Management $20,000 $20,000
•
Initial Moving Expense $40,000 $40,000
$40,000
Building Systems
Floor Modifications: $5,000 $5,000
Building Security $5,000 $5,000
HVAC Modifications $5,000 - $5,000
Life Safety Systems $2,000 $2,000
Sound System $2,000 $2,000
Locks and Crash Bars $2,000 $2,000
Exterior Lighting $2,000 $2,000 .
$23,000
Interior Construction
Misc. Demising Partitions $5,000 $5,000
Party Room Construction $5,000 $5,000
Catering Kitchen $5,000 - $5,000
Office Construction $2,000 $2,000
Stairs and Railings $5,000 $5,000
Ticket/Info Counter $2,000 $2,000
pf 041109 duane.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 Page 1
•
International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. Item
Food and Gift Areas $2,000 $2,000
$26,000
Exhibits
Exhibit Lighting $25,000 $25,000
Carousel Platform $30,000 $15,000 $10,000
Casework $2,000 $2,000
Dividers, Stantions $5,000 $5,000
Exhibit Staging $10,000 $5,000 $5,000
Misc. Staging $0
Window Treatments $0
$72,000
Signage
Exterior Signage $15,000 $5,000 $10,000
Display Graphics $5,000 $5,000
Parking Garage Signage $2,000 $1,000
City Directional Signage $5,000 $5,000
$27,000
Operations
Gift Store Fixtures $2,000 $2,000
Food Service Equipment $2,000 $2,000
Computers,Admin Equipt. $2,000 $2,000
Uniforms and Supplies $1,000 •
$7,000
Marketing
Six Months prior to Opening
Advertising $30,000 $15,000 $15,000
Printing and Materials $5,000 $2,500 $2,500
Events $5,000 $2,500 $2,500
$40,000
pf 041109 duane.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 Page 2„
International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. Item
Pre-Opening Staffing
Marketing Staff $40,000
Operations Staff $20,000
Management $10,000 $10,000
$70,000
Contingency $20,000
Non-Item-Specific Sponsorhip $20,000 $0
Total First Year Capital Budget: $345,000 $57,000 $67,000 $84,000 $70,000
Contributed by IMCA/Perron: $57,000
Funded by City as Tenant Improvements: $67,000
Funded by City as Cash Contribution: $48,000
In-Kind Contributions: $84,000
•
Funded by Sponsorships: $70,000
•
Loan from Perrons: $19,000
Loan from City: $0
•
pf041109 duane.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 Page 3
1
•
EXHIBIT 6
"HYBRID" FINANCIAL MODEL
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# _�� International Museum of Carousel Art—Business Plan
.6,-,,,='°_ Ravenhurst Development,Inc.
`0' 11/29/04
International Museum of Carousel Art HYBRID MODEL
Renton Exhibition Facility
2007 Attendance: Weekday Wkend day •
Assumptions: Gift Sales/visitor: $0.25 Museum: Std.Adult 40 130
Admission Fees: Food Sales/visitor: $0.25 Group Adu 10 40
Std. Adult $7.00 Std. Child 40 130
Group/Sr Adult $6.00 Visits/Family Pass: 12 Group Chil 10 0
•
Std. Child $3.50 Visits/Membership: 6 100 300
Group Child $2.00
Family Pass $50.00 Free Rides/Museum Admission: 1.5 Banquet Parties/wk 1
Individual Pass $30.00 Paid Rides/Museum Admission: 0 Birthday Parties/wk 8
Other $0.00 Large Function Rate $800 Rides Museum 150 450
Ride Fee: $1.50 Birthday Party Rate: - ----- ---- $40- - - -- Mus.-Extra 0 0
Paid Rides/Carousel Only Visitor 2 Paid 250 750
Annual Operating Projections
2005 2006 2007 2008. 2009 2010 2011 2012 2013 2014
Annual Attendance:
Museum Admissions: 51,480 45,760 45,760 48,620 51,480 54,569 57,843 61,314 64,992 68,892
Carousel Only Admissions: 57,200 64,350 71,500 74,360 77,334 80,428 83,645 86,991 90,470 94,089
Annual Family Passes: 2000 14,400 15,600 16,800 19,200 19,968 20,767 21,597 22,461 23,360 24,294
Annual Indiv. Memb: 200 720 780 840 960 998 1,038 1,080 1,123 1,168 1,215
Total Attendance: 123,800 126,490 134,900 143,140 149,781 156,802 164,165 171,889 1791990 188,490
Total Carousel Rides: 181,000 190,840 206,400 217,500 227,115 237,229 247,810 258,879 270,461 , 282,579
Paid Carousel Rides: 114,400 128,700 143,000 148,720 154,669 160,856 167,290 173,981 180,941 188,178
Income and Expense Summary .
Total Gross Income: 662,823 671,624 710,278 750,888 783,932 818,948 855,717 894,329 934,881 .977,474
Total Operating Expenses: -647,917 -657,240 -664,077 -693,168 -719,227 -746,373 -774,563 -803,840 -834,251 -865,843 •
Net Operating Income: 14,907 14,384 46,201 57,720 64,704 72,575 81,154 90,489 100,630 111,630
Paid into Reserves: 14,907 14,384 20,710 0 0 0 0 0 0 0
Capital Loan Repayment: 0 0 25,491 13,509 0 0 0 0 0 0
Operating Loan Repayment: 0 0 0 0 0 0 0 , 0 0 0
•
Carousel Rental: 0 0 0. 0 0 0 0 0 0 0 •
IMCA Programs: • 0 0 0 44,211 64,704 72,575 81,154 : 90,489 100,630 111,630
pf 041129 hybrid.xls Ravenhurst Development, Inc. .
income 11/30/2004 . Page 1
•
International Museum of Carousel Art HYBRID MODEL
Renton Exhibition Facility
Attendance Growth Rates: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Museum Admissions: 90% 80% 80% 85% 90% 95% 101% 107% 114% 120%
Carousel Only Admissions: 80% 90% 100% 104% 108% 112% 117% 122% 127% 132%
Annual Family Passes: 60% 65% 70% 80% 83% 87% 90% 94% 97% 101%
Annual Indiv. Memb: 60% 65% 70% 80% 83% 87% 90% 94% 97% 101%
Paid Carousel Rides: 80% 90% 100% 104% 108% 112% 117% 122% 127% 132%
Birthday/Banquet income: 50% 70% 80% 83% 87% 90% 94% 97% 101% 105%
Income: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Attendance income: 267,228 237,536 237,536 252,382 267,228 283,262 300,257 318,273 337,369 357,611
Family Pass income: 60,000 65,000 70,000 80,000 83,200 86,528 89,989 93,589 97,332 101,226
Indiv. Memb. income: 3,600 3,900 4,200 4,800 4,992 5,192 5,399 5,615 5,840 6,074
Ride income: 171,600 193,050 214,500 223,080 232,003 241,283 250,935 260,972 271,411 282,267
Catering Income: 18,750 9,375 13,125 15,000 15,600 16,224 16,873 17,548 18,250 18,980 19,739
Banquet Income: 20,800 29,120 33,280 34,611 35,996 37,435 38,933 • 40,490 42,110 43,794
Birthday Room Income: 8,320 11,648 13,312 13,844 14,398 14,974 15,573 ' 16,196 16,844 17,518
Subtotal: income subj. to% rent: 540,923 553,379 587,828 624,318 654,041 685,547 718,634 753,385 789,886 828,229
Concession income:
Food Service: 30,950 31,623 33,725 35,785 37,445 39,200 41,041 ' 42,972 44,998 47,122
Gift Store: 30,950 31,623 33,725 35,785 37,445 39,200 41,041 42,972 44,998 47,122
Sponsorships: 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000
Grants: 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000
•
Donations: 25,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000
Total Gross Income: 662,823 671,624 710,278 750,888 783,932 818,948 855,717 894,329 934,881 977,474
•
pf 041129 hybrid.xls Ravenhurst Development, Inc. '
Income 11/30/2004 Page 2
International Museum of Carousel Art HYBRID MODEL
Renton Exhibition Facility
Expense: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Rent: 9595 sf $9.93 $10.25 $11.15 $12.10 $12.87 $13.69 $14.56 $15.46 $16.41 $17.41
Percentage Rent: 95,231 98,345 106,957 116,079 123,510 131,387 ' 139,659 148,346 157,471 167,057
Less Marketing Contribution: 0 0
Other Payments to Landlord:
Leasehold tax: $0.75 7,196 7,412 7,635 7,864 8,099 8,342 8,593 8,850 9,116 9,389
Exterior CAM: $0.00 0 0 0 0 0 0 0 0 0 0
Insurance: $0.50 4,798 4,941 5,090 5,242 5,400 5,562 5,728 5,900 6,077 6,260
Escalation: 3.0% - -Operations Personnel: -
Salaries: 100,000 103,000 106,090 109,273 112,551 115,927 119,405 122,987 126,677 130,477
Benefits: 32% 30,000 32,960 33,949 34,967 36,016 37,097 38,210 39,356 40,537 41,753
Curatorial Expense: 20,000 21,000 22,050 23,153 24,310 25,526 26,802 28,142 29,549 31,027
Marketing/Development:
Salaries: 80,000 82,400 84,872 87,418 90,041 92,742 95,524 98,390 101,342 104,382
Benefits: 32% 30,000, 30,900 31,827 32,782 33,765 34,778 35,822 36,896 38,003 39,143
Media: 90,000 60,000 40,000 41,200 42,436 43,709 45,020 46,371 47,762 49,195
Membership: 20% 21,200 13,780 14,840 16,960 17,638 18,344 19,078 19,841 20,634 21,460
Operations:
Utilities: 18,000 18,540 19,096 19,669 20,259 20,867 21,493 22,138 22,802 23,486
Supplies: 5,000 5;150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Repairs and Maint.: 12,000 12,360 12,731 13,113 13,506 13,911 14,329 14,758 15,201 15,657
Janitorial contract: 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095
Security contract: ••
Monitoring: 6,000 6,180 6,365 6,556 6,753 6,956 7,164 7,379 7,601 7,829
Equipment: 2,000 2,060 2,122 2,185 2,251 2,319 2,388 2,460 2,534 2,610 •
Phone 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Education and Docent programs: 14,000 14,420 14,853 15,298 15,757 16,230 16,717 17,218 17,735 18,267
Payroll Administration: 101000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668 13,048
Professional Fees: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
Misc. Expense: 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668 13,048
pf-041129 hybrid.xls Ravenhurst Development, Inc.
income 11/30/2004 Page 3
•
International Museum of Carousel Art HYBRID MODEL
Renton Exhibition Facility
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Exhibit Costs:
Lighting/Displays: 0 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334
Seasonal/Special Exhibits: 5,000 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 12,668
Maintenance/Repair: 0 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335
Transport: 0 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334
Insurance:
Liability: 7% 12,012 13,514 15,015 15,616 16,240 16,890 17,565 18,268 18,999 19,759
Property: 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524
•
Cost of Goods Sold:
Food: 40% 15,390 12,649 13,490 14,314 14,978 15,680 16,417 17,189 17,999 18,849
Gifts: 60% 23,085 18,974 20,235 21,471 22,467 23,520 24,625 25,783 26,999 28,273
Total Operating Expenses: 647,917 657,240 664,077 693,168 719,227 746,373 774,563 803,840 834,251 865,843
Net Operating Income: 14,907 14,384 46,201 57,720 64,704 72,575 81,154 90,489 100 630 111,630
Capital Investment: -375,000 0 0 0
Tenant Allowance from City: 115,000
Initial Sponsorships 75,000
In-Kind Contributions 89,000
Funded by IMCA 57,000
Loan from City 0
Loan from Perrons ' 39,000
Net Cash Flow: 14,907 14,384 46,201 57,720 64,704 72,575 81,154 90,489 100;630 111,630
pf 041129 hybrld.xls Ravenhurst Development, Inc.
Income 11/30/2004 Page 4,
International Museum of Carousel Art HYBRID MODEL
Renton Exhibition Facility
Cash Flow Distributions: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Net Cash Flow from Operations 14,907 14,384 46,201 57,720 64,704 72,575 81,154 90,489 100,630 111,630
Reserve Balance: 0 14,907 29,290 50,000 50,000 50,000 50,000 50,000 50,000 50,000
Applied to Reserves: 14,907 14,384 20,710 0 0 0 0 0 0 0
Available for Loan Reduction: 0 0 25,491 57,720 64,704 72,575 81,154 90,489 100,630 111,630
Year-End Capital Loan Balances: _- _ _ _ - - ---
- - -- --City: 0 0 0 0 0 0 0 0 0 0 0
Perror -39,000 -39,000 -39,000 _ -13,509 0 0 0 0 0 . 0 0
Applied to Capital Loan Reducl 0 0 25,491 13,509 0 0 0 0 0 0
•
•
Available for Operating Loan Reduction: 0 0 44,211 64,704 72,575 81,154 90,489 100,630 111,630
Year-End Operating Loan Balances:
City: 0
•
Perror 0 0 0 0 0 0 0 0 0 0 0
Applied to Operating Loan Reduction: 0 0 0 0 0 0 0 0 0
- Available for Collection Rental: 0 0 0 44,211 64,704 72,575 81,154 90,489 100,630 111,630 ,
` l.
Collection Rental: 0 0 0 0 0 0 0 0 0 0
Available for IMCA Programs: 0 - 0 0 44,211 . 64,704 72,575 81,154 90,489 100,630 111,630
Renton Facility Upgrade: 0 0 0 13,000 19,000 22,000 24,000 27,000 30,000 33,000
IMCA Collection Restoration: 0 0 0 9,000 13,000 15,000 16,000 18,000 20,000 22,000
IMCA Acquisition Fund: 0 0 0 22,000 32,000 36,000 41,000 45,000 50,000 58,000
pf.041129 hybrid.xis Ravenhurst Development, Inc. •
income 11/30/2004 Page 5
•
International Museum of Carousel Art
Renton Exhibition Facility
Staffing Projections:
IMCA Management: Years 1-5 $0
Years 6-10 $0
Operations Personnel: 32%
Summer Hours: Staffing Hourly wage Hours/Day Days Wages Burden Total
Manager 1 $16.00 10 150 $24,000 $7,680 $31,680
Operators 3 $8.00 10 150 $36,000 $11,520 $47,520
Winter Hours:
Manager 1 $16.00 .6 210 $20,160 $6,451 $26,611
Operators 2 $8.00 6 210 $20,160 $6,451 $26,611
$100,320 . $32,102 $132,422 ,
Rounded $100,000 $30,000 $130,000
Marketing/MembershIplDevelopment Personnel: .
Manager: 1 $50,000 $50,000 $16,000 $66,000 .
Events Coordin 1 $34,000 $34,000 $10,880 $44,880
•
$84,000 $26,880 $110,880
Rounded $80,000 $30,000 $110,000 1
pf 041129 hybrid.xis Ravenhurst Development, Inc. S '
Personnel 11/30/2004 Page 1
•
i
International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. Item
Collection & Exhibits
Artifacts $3,000,000
Ferris Wheel $40,000
Carousel $750,000
Band Organ $50,000
Miniatures - $12;000-
Total Exhibit Value: $3,852,000
Design and Project Management $20,000 $20,000
Initial Moving Expense $40,000 $40,000
$40,000
Building Systems
Floor Modifications: $5,000 $5,000
Building Security $5,000 $5,000
HVAC Modifications $5,000 $5,000
Life Safety Systems $2,000 $2,000 •
• Sound System $2,000 $2,000
Locks and Crash Bars $2,000 $2,000
Exterior Lighting $2,000 $2,000
•
- $23,000
Interior Construction
Misc. Demising Partitions $5,000 $5,000
Party Room Construction $5,000 $5,000
Catering Kitchen $5,000 $5,000
Office Construction $2,000 $2,000
Stairs and Railings $5,000 $5,000
Ticket/Info Counter $2,000 $2,000
pf 041129.hybrid.xls Ravenhurst Development, Inc.
cap budget
11/30/2004 Page 1
International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. Item
Food and Gift Areas $2,000 $2,000
$26,000
Exhibits
Exhibit Lighting $25,000 $25,000
Carousel Platform $30,000 $15,000 $10,000
Casework $2,000 $2,000
Dividers, Stantions $5,000 $5,000
Exhibit Staging $10,000 $5,000 $5,000
Misc. Staging $0
Window Treatments ' $0
$72,000
Signage
Exterior Signage $15,000 $5,000 $10,000
Display Graphics $5,000 $5,000
Parking Garage Signage $2,000 $1,000
City Directional Signage $5,000 $5,000
$27,000
Operations
Gift Store Fixtures $2,000 $2,000
Food Service Equipment $2,000 $2,000
Computers, Admin Equipt. $2,000 $2,000
Uniforms and Supplies $1,000
$7,000
Marketing
Six Months prior to Opening
Advertising $60,000 • $20,000 $20,000 •
Printing and Materials $5,000 $2,500 $2,500
Events $5,000 $2,500 $2,500
$70,000
pf•041129 hybrid.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 Page 2
E
•
International Museum of Carousel Art
Renton Exhibition Facility
Funding Sources
Capital Budget• New Costs In-Kind Contrib. City In-Kind Sponsored
By Perron/IMCA T. I. Pack Contrib. -Item
Pre-Opening Staffing
Marketing Staff $40,000
Operations Staff $20,000
Management ' • $10,000 . $10,000
$70,000
- ---- ----- --- -- -- ---
- -- -- —
-- Contingency –_$20,000
Non-Item-Specific Sponsorhip $20,000 $0
Total First Year Capital Budget: $375,000 _ $57,000 $67,000 $89,000 $75,000
Contributed by IMCA/Perron: $57,000
Funded by City as Tenant Improvements: $67,000 •
Funded by City as Cash Contribution: $48,000
In-Kind Contributions: $89,000
Funded by Sponsorships: $75,000
Loan from Perrons: $39,000
Loan from City: $0 •
pf 041129 hybrid.xls Ravenhurst Development, Inc.
cap budget 11/30/2004 _ Page 3
EXHIBIT 7
COMPARABLE FACILITIES DATA
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International Museum of Carousel Art—Business Plan
4irakiL Ravenhurst Development, Inc.
,skZr-' 11/29/04
,0 k rl
1
V
International Museum of Carousel Art
Renton Exhibition Facility
Comparable Facilities Data ' -
Venue Spokane, WA Great Northern Missoula
City Parks Dept. Carousel
I
Location -°'- Spokane, WA Helena, MT Missoula,-MT
pop. 40,000
Contact I Creig Butz Beth Johnson Terrisa Cox
Phone 509-625-6610 406-457-5353 406-549-8382
Environment Urbn City Park comm. District City Park
Attendance i 150,000
Paid Rides . 290,000 98,000 220,000
Ride Fee 1 $1.50 avg $1.00 $0.501$1.50
Memberships summer pass
Party Rooms alcove yes alcove
I
Party Room Fees $55.00 $75.00
w/food
Parties/Month 50/yr 40-50 20-32
Banquet Rooms around carousel around carousel
$245 1sthr, $180addl $250 min $150 min
Banquet Nights/yr 66/yr 30 150
Gross Income $345,000 $340,000 $300,000
Marketing Budget $0
# Paid Staff 3 wkdays, 4 wkends 4 wkdays, 6 wknds
#Volunteers some 6 carvers, 4 mech
Ravenhurst Development,Inc.
11/30/2004 carousels nat.xls Page 1
International Museum of
Renton Exhibition Facility
Comparable Facilities Data
Auburn
Venue Salem Mansfield Supermall
Location Salem, OR Mansfield, OH Auburn, WA
Contact Marie Bradford Laura West Justine
Phone 503-540-0374 419-522-4223 303-755-3055
Environment City Park Small Downtown reprod. Carousel
in mall
Attendance 140,000
50%tourists,50%locals
Paid Rides 215,000 170,000 120,000 est.
Ride Fee $1.25 $1.50
Memberships $65 no . no
sell 70/mo
Party Rooms yes yes no
prep kitchen
Party Room Fees $95.00 $39.00
Parties/Month 30 60
Banquet Rooms yes, 175 standing yes, 210 seats
$300 min
Banquet Nights/yr 120
$250 base
Gross Income $450,000 $300,000
Marketing Budget $32,000 $9,000
# Paid Staff 8 4 op, 1 gift, 1 admin 1 operator/shift
#Volunteers 40 0
Ravenhurst Development,Inc_ Page 2
11/30/2004 carousels natjds
p
International Museum of
Renton Exhibition Facility
Comparable Facilities Data
Venue i Knoebels Clackamas West Nyack
Grove
Location Elysburg, PA Clackamas, OR West Nyack, NY
Contact ! David Wynn Duane Perron Duane Perron
Phone 570-672-2572 541-387-2979 541-387-2979
Environment Carousel Museum regional mall regional mall
in amusement park
Attendance
Paid Rides 500,000 140,000
Ride Fee $1.50 $2.00
Memberships no
Party Rooms no
Party Room Fees
Parties/Month
Banquet Rooms no
Banquet Nights/yr
Gross Income $750,000 $280,000
Marketing Budget
# Paid Staff
#Volunteers
Ravenhurst Development,Inc.
11/30/2004 carousels nat.xds Page 3
1 l
I
International Museum of
Renton Exhibition Facility
Comparable Facilities Data
Venue Seaport Village Santa Barbara Sandusky
Carousel Museum
Location San Diego, CA Santa Barbara, CA Sandusky, OH
Contact Duane Perron Duane Perron Vicki Vandenbout
Phone 541-387-2979 541-387-2979 419-626-6111
Environment tourist village City Park Independent
in tourist community
Attendance 25,000
Paid Rides 210,000 92,500 na
Ride Fee $2.00 $2.00 $0.00
Memberships no 700 members
Family: $35
Party Rooms yes
Party Room Fees $175.00
package
Parties/Month 4
Banquet Rooms no
Banquet Nights/yr
Gross Income $420,000 $185,000 $300,000
Marketing Budget
# Paid Staff 4
#Volunteers 100
Ravenhurst Development,Inc.
11/30/2004 carousels nat.xds Page 4
p
International Museum of
Renton Exhibition Facility
Comparable Facilities Data
Venue Columbus Zoo Indianapolis
Childrens Museum
- I
Location i Columbus, OH Indianapolis, IN
Contact Donna Folla
Phone 614-645-3400 317-334-3703
Environment ! national zoo urban museum
Attendance
Paid Rides 250,000 400,000
Ride Fee $1.00 $1.00
Memberships members ride free.
Party Rooms
Party Room Fees
Parties/Month
Banquet Rooms •
•
Banquet Nights/yr
Gross Income
Marketing Budget
# Paid Staff
#Volunteers
Ravenhurst Development,Inc.
11/30/2004 carousels nat.xls Page 5
x �_
? I+! io t3id c, I!41/i.�'�s<
Ioo5 I .'.
CITY OF RENTON �' 0 2004
ECONOMIC DEVELOPMENT, NEIGHBORHOODS, REPITONOMTOUNCE
AND STRATEGIC PLANNING DEPARTMENT
MEMORANDUM
CITY OF RFNTO J
•
DATE: December 29, 2004 JAN 0 3 2005
RECEIVED
TO: Don Persson, Council President CITY CLERK'S OFFICE
Members of;the Renton City Council
CC: Mayor Kathy Keolker-Wheele ,z I
FROM: Alex Pietsch; Administrator NZ?Orr
Economic Development, Neighborhoods, and Strategic Planning Department
SUBJECT: POTENTIAL CAROUSEL MUSEUM AT THE PAVILION BUILDING
' I
With the Councilmembers' support, the Administration would like to begin negotiating with
representatives of the International Museum of Carousel Art (IMCA) to potentially use the Pavilion
Building for a carousel museum. At the Committee of the Whole meeting on December 13, 2004,
Councilmembers shared a number of questions and concerns regarding the proposed carousel
museum. As in-depth negotiations with the IMCA have not actually begun,.it is difficult to answer
all of the City Council's questions completely. However, this memo responds to the questions and
concerns based on the best information available at this time. EDNSP staff will also be present at
the January 3, 2005 Committee of the Whole meeting to provide additional information or respond
to any other questions or concerns.
Pavilion Building — Carousel Museum Proposal
1. The range of potential City-paid tenant improvements and other pre-opening expenses
of$150,000 to $500,000 is considerable. What will the City be expected to spend?
The conceptual business plan includes three financial models for the carousel museum, the
"optimal" model and the "Perron" model, plus a "hybrid" model. The optimal financial model has
increased capital investment and marketing/fundraising, but would also produce a higher-quality
facility and museum experience with faster growth projected. The Perron model has less front-end
costs and slower growth projected. The hybrid model essentially reflects the Perron model with
additional first-year marketing resources to increase attendance.
Each model has an estimated capital budget for tenant improvements', exhibit lighting and staging,
pre-opening IMCA staffing and marketing, IMCA design and project management expenses and
1 The proposed tenant improvements include modifying the floor to support the carousel, lighting and security
improvements and the addition of office and birthday party room spaces, a ticket counter, food and gift areas and a
catering prep area.
•
p
December 29, 2004
Page 2
initial moving expenses. The estimated capital budget ranges from $345,000 for the Perron model
to $620,000 for the optimum model. The Perron family and the IMCA expect to cover part of the
capital budget expenses. In addition, the Perron family plans to loan a carousel, carousel animals
and chariots and other artifacts valued at an estimated $3.8 million for the carousel museum.
However, the carousel museum also needs capital budget support from the City and, preferably,
also from other businesses or corporations. Depending upon the financial model that is used and
the success of other potential fundraising opportunities, the City-paid tenant improvements for
capital and other pre-opening expenses could run from between $150,000 and $500,000 for the
project.
The large range in the potential City-paid capital budget expenses is directly related to (a) the
quality of the anticipated museum facility and experience, (b) the amount of marketing to promote
the new carousel museum and (c) the amount of time before the carousel museum can begin
operations. The first two items are represented by.the $275,000 difference in the capital budget for
the optimal fmancial model versus the Perron financial model. The third item relates to how much
time it will take the IMCA to raise capital funds from other private entities and the resulting delay
in starting the carousel museum. Although the City is unable to determine how much City money
is enough to use the Pavilion Building for a carousel museum until we negotiate with the IMCA,
we know that additional City capital funds will help increase the quality of the museum, the amount
of marketing and/or how soon the museum begins operating.
For example, the City might be able to pay $150,000 in tenant improvements and other pre-
opening expenses. However, the quality of the museum facility or experience might be impacted
and/or the carousel museum opening might be delayed until the IMCA could raise private funds to
support the capital budget. As an alternative, the City might also consider a low or no interest loan
for part of the capital budget to help the carousel museum open promptly with the desired tenant
improvements and marketing.
The $150,000 to $500,000 in potential City-paid tenant improvements for capital and other pre-
opening expenses for the carousel museum compares with $250,000 in City-paid tenant
improvements requested by the "National Fitness Center" and $600,000 to $1,200,000 in projected
City-paid tenant improvements requested for Shelby's Concepts. In addition, based on the
feedback that EDNSP has received from many prospects, EDNSP staff anticipates that the City
would likely be asked to provide "below-market" rent and/or significant City-paid tenant
improvements for the space for other potential tenants.2
2 Tenant improvement and lease incentives are typical in the marketplace today. Within the restaurant industry, these
incentives have in some instances become massive. For example, we learned in 2003 from a CB Richard Ellis broker
that the Ruth's Chris Steak House received approximately $750,000 in free tenant improvements in order for them to
locate in Bellevue Square. In another example, the owner of Pagotcha Restaurants informed us that he received the
following incentive package to locate at the Summit Building in Bellevue's downtown core:
• 10 year lease(5 years plus a 5-year option); first-year rent-free (10% of adjusted gross sales thereafter)
• 98% of the tenant improvements paid for by the developer(about$580,000)
• One-year escape clause for the restaurant after one year(bottom line: they can walk away from the restaurant after
two years if not successful)
• Tenant-paid utilities, but owner-paid property taxes and insurance
December 29, 2004 -
Page 3
Finally, if the City proceeds with the IMCA carousel museum, the City will owe Ravenhurst
Development, Inc. a $40,000 brokerage commission, less the $5,000 paid by the City for the
business plan. Fifty percent of the commission would be due when the lease is signed and the
balance due when the carousel museum opens for business. This compares with a $46,000+
brokerage commission for the "National Fitness Center".
2. What are the potential oil-going financial contributions by the City?
The potential on-going financial contributions by the City will be determined through lease
negotiations with representatives of the IMCA. However, all three of the financial models included
in the conceptual business plan for the carousel museum currently assume that:
(a) the IMCA will be responsible for all administration, management, marketing, fundraising and
operations for the carousel museum, although the organization would benefit, at least initially, from
the City's support or assistance with some of the marketing and fundraising activities;
(b) the IMCA will be responsible for percentage rent (described below), leasehold taxes, insurance,
utilities, repairs and maintenance, janitorial services, operating supplies and security services; the
City will be responsible for the exterior CAM (common area maintenance); and
(c) the IMCA and, in particular, the Perron family will be responsible for any operating losses.
Based on these assumptions, the City's ongoing financial contributions should be limited.
However, the City has not yet calculated the projected exterior CAM expenses or determined the
amount of City staff time, if any, that might be involved in helping the IMCA do marketing or
fundraising for the project. Furthermore, the conceptual business plan does not address whether
the bathrooms are open to the public. If the restrooms are available, for example, to users of the
Piazza and Renton Transit Center,!the City would also likely need to provide or pay for at least a
prorated share of the related supplies and janitorial and repairs and maintenance services. After
EDNSP staff addresses these issues with representatives of the IMCA during negotiations, the City
will have a better sense of the potential on-going financial contributions for the carousel museum.
3. How much will it cost to reconvert the Pavilion Building to another use (e.g., if the
carousel museum is unable to generate sufficient revenue and closes after three years of
operation)?
The conceptual business plan includes projected capital expenses, including projected tenant
improvements, based on the experience and knowledge of Darrell Vange from Ravenhurst
Development Inc. and Duane Perron from the IMCA. However, the build out and exhibit expenses
will need to be analyzed and refined, if necessary, by an architect and possibly an exhibit designer
once the IMCA finalizes a lease agreement with the City. Hence, the projected tenant
improvements are subject to change.
Once the City has a better understanding of the actual renovations required for the carousel
museum, it will be easier to determine the cost to reconvert the space to its existing condition, if
December 29, 2004
Page 4
necessary, to support another use. Nonetheless, EDNSP staff believes that the conversion expenses
would be far less for the current proposed tenant improvements for the carousel museum than, say,
for a restaurant or even the "National Fitness Center" use.
4. How is the City going to pay for the tenant improvements and other pre-opening
expenses, plus any ongoing financial contributions? What is the City's exposure for
the total package?
The City's exposure for the total package will be a combination of the City-portion of the capital
budget expenses and any potential on-going financial contributions as described above. The actual
figures will be determined through negotiation. The Administration has not yet determined the
source of funds to use to pay for the City-portion of the tenant improvements and other pre-opening
expenses. However, one potential source of funds is the year-end fund balance. The on-going
financial contributions would likely be integrated into the ongoing department operating budgets,
for example, by the Facilities Division for operating expenses (e.g., the exterior CAM and any
public bathroom responsibilities) and by the EDNSP for marketing and fundraising assistance, if
any.
5. The IMCA is interested in a 10-year lease with options for 20 additional years (i.e., a
total potential 30-year lease). Since the proposed rent is tied to the carousel museum's
revenues, there is concern about the lack of assurance regarding rent to the City.
What provisions are proposed to address this (e.g., the three-year "kick-out" clause)?
The IMCA proposes to lease the entire Pavilion Building from the City for a ten-year period with
options for an additional twenty years.
The conceptual business plan proposal includes a rent structure based on a percentage of the
carousel museum's annual gross income, beginning with no rent for the first $100,000 of gross
income, 15% rent on the next $100,000 of gross income, 20% on the next $100,000 of gross
income and 25% rent on anything over $300,000 of gross income. For example, the projected rent
for the third year of operation ranges from $92,111 to $123,530 (or a range of$9.60/sf to
$12.87/sf) depending upon which fmancial model is used. [For comparison purposes, the
"National Fitness Center" proposed $16.00/sf(i.e., $153,040 per year) and Shelby's Concepts
proposed no rent for the first two years, $12.00/sf for the third year (i.e., $114,780) and 5% of
total sales when sales reach $2,500,000 (i.e., equal to approximately $125,000+ per year in rent).
Although both the City and IMCA believe that the Pavilion Building can be used effectively for a
carousel museum, the conceptual business plan proposes the following three-year "out" for either
party: "If, at the end of the third year of the lease, the facility is not generating sufficient income
to pay the City at least $100,000 in rent per year, either party has the right to terminate the lease.
(OR) The City may elect to continue the lease with a minimum annual rent payment of$100,000"
(if acceptable to the IMCA). However, the City may want to negotiate additional or alternative
lease conditions (e.g., rent and/or attendance figure thresholds) to provide assurances, safeguards
and or "outs" over the life of the lease, including any renewals.
3 All of the square foot rent/lease projections are based on the 9,595-square foot open hall.
.
December 29, 2004
Page 5
6.- The carousel museum business plan identifies a need to raise private funds. Since the
Perron's strengths apparently are not in fundraising, who's going to do the fundraising
for the organization? �
The conceptual business plan includes: (a) fundraising needs for the capital budget of
approximately $154,000 to $328,000 (including both sponsorships and in-kind contributions),
depending upon the financial model used and the capital contributions by the IMCA, the Perrons
and the City; and (b) projected fundraising for the operating budget of approximately $60,000 per
year (including sponsorships, grants and donations).
Mr. Vange believes that the Perrons have the ability to build the facility into a self-supporting,
positive cash flow attraction that would accomplish many of the City's objectives. However, in
order to make the initial carousel museum a first-class experience and to broaden the base of
support for the IMCA to become the long-term receptacle of the Perron carousel collection, the
conceptual business plan recommends as a condition of the City's potential lease that the IMCA
hire an Executive Director to manage the marketing and fundraising for the carousel museum. The
Executive Director would be an employee of the IMCA, not the City.
The IMCA is a 501(c)(3) nonprofit educational organization dedicated to the preservation,
restoration and exhibition of the world's antique carousels and carousel related art. Although the
IMCA would likely benefit, at least initially, from the City's support or assistance with some of the
marketing and fundraising activities for the project, the City has not determined the amount of City
staff time, if any, that might be involved in helping the IMCA do marketing or fundraising for the
carousel museum.
As a regional museum facility, the IMCA would be working to secure corporate sponsorships and
individual donations from interested parties in the region who are supportive of their organization's
mission and operations. Although the IMCA may pursue some of the same potential sources of
funds as other non-profit organizations in Renton, the organization would likely attract a different
sector of potential supporters interested, for example, in the preservation and display or carousel
and folk art.
7. The City and IMCA each paid $5,000 to develop a conceptual business plan to establish
and operate a carousel museum at the Pavilion Building. There is concern about the
City spending $5,000 for a business plan for a private business if the City or IMCA
decides not to proceed with use of the Pavilion Building for a carousel museum.
EDNSP has been working since April 2004 (when renovation was completed on the building) to
identify and contact 123 potential tenants to lease space in the Pavilion Building, including eight
developers, 71 restaurants/brew pubs, 17 grocery/food entities, five bookstores, one drug store, 14
music/arts/entertainment/recreation entities, four furniture stores and three "event" uses. Several
dozen businesses expressed an interest in either the Pavilion Building or other opportunities in
Renton. However, the City received only one formal offer for use of the Pavilion Building as of
the end of August 2004, a letter of;interest from a "National Fitness Center". In September 2004,
. V
December 29, 2004
Page 6
Councilmembers considered the "National Fitness Center" proposal and decided that it was not a
desired use for the facility.
As part of the department's efforts to pursue options with a variety of potential target anchor
tenants, EDNSP staff worked with Mr. Vange and the Perrons to explore the potential for the
IMCA to establish a carousel museum at the Pavilion Building. Although EDNSP staff has
continued to explore other potential uses of the Pavilion Building, the carousel museum stood out in
September 2004 as a unique opportunity to utilize the Pavilion Building for a potential regional
attraction - especially if other targeted anchor retail tenants were not interested in locating to the
Pavilion Building in the current downtown Renton marketplace.
As collectors and preservationists, the Perrons have acquired a wealth of knowledge, a phenomenal
carousel collection and tremendous experience operating carousels and displaying carousel art for
almost 30 years. However, as noted in Mr. Vange's business plan, the Perrons do not have
"sophisticated" ideas about marketing and museum displays. Although the Perrons expressed
interest in using the Pavilion Building to achieve a permanent home for their core collection,
EDNSP has many questions about how the IMCA would establish and operate a carousel museum
at the facility.
To help address EDNSP's questions and provide a more comprehensive proposal for the potential
use of the Pavilion Building for a carousel museum, the City and IMCA jointly engaged Mr. Vange
at Ravenhurst Development, Inc. at the end of September 2004 at a cost of$5,000 each. The goal
was to create a conceptual business plan for the build out and successful use of the Pavilion
Building for an ongoing professionally operated carousel museum. Mr. Vange's report has been
very useful for the City to more effectively analyze the potential use of the Pavilion Building for
the carousel museum and to provide a framework for lease negotiations with the IMCA.
The City has engaged other consultants in the past to prepare studies regarding the potential use of
the Pavilion Building. Although the most current business plan relates to a specific potential user,
the IMCA is a 501(c)(3) non-profit organization that paid for 50% of the business plan's cost.
EDSNP has not offered to share in the cost of a creating a business plan with other prospective
tenants for the Pavilion Building to date. The potential use of the Pavilion Building for a carousel
museum provided a unique situation that benefited from a jointly funded business plan.
Pavilion Building - Spirit of Washington Dinner Train Proposal
8. The Spirit of Washington Dinner Train has expressed interest previously in using the
Pavilion Building for banquets and special events. Why hasn't the Administration
followed up with the Spirit of Washington regarding their initial proposal? The
Council President talked with the owner, who said he was discouraged from submitting
additional information. There is concern about creating an unfair playing field.
The Mayor, individual Councilmembers and EDNSP staff have had discussions with the owners of
the Spirit of Washington Dinner Train about using the building as a private event space. In
particular, staff met with Eric Temple alone and with the Mayor on several occasions. Through
•
December 29, 2004
Page 7
discussions with him, staff has gathered a basic understanding of his concept and a potential deal
structure.
The Dinner Train would manage, market and operate the entire Pavilion Building as event space. It
could be used for a wide variety of events, including weddings, corporate meetings and parties, as
well as community events such as the Chamber of Commerce Holiday Auction or Rotary Caper.
The Dinner Train would use its existing catering operation at the Train Depot to provide food
service to the building. The building would function as an open hall and tenant improvements
would be minimal. Mr. Temple indicated that, at a minimum, he would consider a three-year lease
with additional year-to-year terms and a 12-month kick-out clause. He would consider some base
rent with the City receiving an additional percentage of their gross receipts.
The number of events that the facility would host is unclear and will depend on the demand and
success of marketing efforts, although Mr. Temple indicates that he would need to have
approximately 130 to 150 events a'year to make the effort worthwhile. If these events were evenly
scheduled throughout the year, the building would be dark four or more days each week.
The Administration believes this use does not meet the City Council's goal to have the Pavilion
Building function as a center of regular activity in downtown Renton. However, if other efforts to
secure a more active tenant are not successful, an event use of the building may be a good way to
have some activity in the building while downtown Renton continues its revitalization efforts and
the market for retail improves.
CONCLUSION
The IMCA carousel museum represents a unique opportunity to use the Pavilion Building for a
public-oriented use that has the potential to draw people to downtown Renton from throughout the
Puget Sound region and beyond. The carousel art builds on Renton's craftsman history and adds to
the entertainment opportunities and collectibles theme in downtown Renton. The carousel museum
would also utilize and benefit from the expansive open architectural style of the Pavilion Building.
Although the City would need to contribute additional funds for tenant improvements, the
economics of the carousel museum proposal for the City are comparable to or better than the terms
of the recent restaurant and banquet/meeting room proposal submitted to the City (and later
withdrawn) or other potential deal that EDNSP staff anticipates might be possible at the Pavilion
Building under the current market conditions. Consequently, with the City Council's support, the
Administration would like to begit!negotiating a lease with representatives of the IMCA to use the
Pavilion Building for a carousel museum. The lease will be subject to review and approval by the
City Council. If the City can come to an agreement with the IMCA, the goal would be to have the
carousel museum open at the Pavilion Building by summer 2005.
cc: Jay Covington
Dennis Culp
Ben Wolters
Mark Santos-Johnson