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re:envisionbergamot:station TITLE

re:envisionbergamot:station

DEVELOPMENT TEAM

Jeff Worthe, PresidentWORTHE REAL ESTATE GROUPReal Estate Developer

Joe Coriaty AIA, PrincipalFREDERICK FISHER AND PARTNERSBergamot Station Architect

Frederick Fisher AIA, PrincipalFREDERICK FISHER AND PARTNERSBergamot Station Architect

Howard Robinson,Real Estate Consultant

James Burnett, FASLA, PresidentOFFICE OF JAMES BURNETTLandscape Architect

Matt Lavin WORTHE REAL ESTATE GROUP Real Estate Developer

Joel ZenoFREDERICK FISHER AND PARTNERS

Arash Azarbarzin, PresidentSBE HOTEL GROUPHotel Consultant

Michael HernandezWORTHE REAL ESTATE GROUP

Wayne BlankSHOSHANA WAYNE GALLERYFounder, Bergamot Station

John Clark, PrincipalLOOKINGGraphic Design Consultant

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re:envisionbergamot:station DEVELOPMENT TEAM

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REAL ESTATE DEVELOPMENT

M. David PaulManaging MemberJeff WorthePresident

100 Wilshire BoulevardSuite 1600Santa Monica, CA 90401p 310.393.9653f 310.458.2644e jeff@worthe.com

LANDSCAPE ARCHITECTURE

James BurnettPresident

550 Lomas Santa FeSuite ASolano Beach, CA 92075p 858.793.6970f 858.793.6905e jburnett@ojb.com

ARCHITECT

Frederick Fisher, Joe CoriatyPrincipals

12248 Santa Monica BoulevardLos Angeles, CA 90025p 310.820.6680f 310.820.6118e joec@fisherpartners.com

ARTS PROGRAMMING

Aaron PaleyPresident, Co-founder

3780 Wilshire BoulevardLos Angeles, CA 90010p 213.365.0605f 213.365.0702e aaron@carsla.com

HOTEL AND HOSPITALITY

Sam NazarianFounder, Chairman, CEO Arash AzarbarzinPresident, SBE Hotel Group

8000 Beverly BoulevardLos Angeles, CA 90048p 323.655.8000f 323.655.8001e arash@sbe.com

FOUNDER

Wayne BlankFounder

2525 Michigan Avenue B1Santa Monica, CA 90404p 310.453.7535f 310.453.1595e wayneblank@verizon.net

BRAND AND IDENTITY DESIGN CONSULTANCY

John ClarkPrincipal

145 Standard StreetEl Segundo, CA 90245p 310.322.6330f 310.322.3762e johnclark@lookingla.com

HOTEL GROUP

Wayne BlankBergamot Station

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PARKING

The Bergamot Station Arts Center RFP stated that the development must self-park (or meet the parking requirements of LUCE and the now adopted Bergamot Area Plan), either on-site or nearby. The City Yards shared parking structure was presented as an option to help meet the proposed project’s parking needs.

1. Do you have any additional information you would like to provide on how your team would reduce or eliminate the City’s obligation to finance the structure and/or its cost for City employees to use the structure?

• We would propose a few possible strategies to lower and possibly eliminate the cost for

the City of Santa Monica to park the City Yards employees in the new proposed parking

structure. They are as follows:

• We could enter into a revenue sharing arrangement with the City to offset their cost of

using the garage.

• The City could commit to rent 350 stalls at $125.00/month for a 30 year period. This

would provide the ability to finance the garage in a cost efficient manner. The cost to

the city would be offset by the additional revenue received on the remaining 210 stalls

and use of the City’s 350 stalls in the evening and on the weekends. The sources of

revenue would consist of the following:

• Day Time: The remaining 210 cars will be used by employees and visitors of

Bergamot Station. We would propose a nominal charge of $2.00/car/day. If only

half of those 210 spaces are used at $2.00/day for 51 weeks a year, this would

generate $74,970 annually.

• Day time: For neighboring tenants, the costs of monthly parking would be

$150.00. The utilization of 75 spaces would generate $135,000 annually.

• Night Time: Events four times per month that would make use of all 560

spaces at 2.00/car will generate $53,760 annually.

• Night Time: Evening Expo riders and gallery visitors paying $2.00/car,

assuming only half the stalls are utilized six nights per week (event night

above excluded), would generate $171,360 annually.

• These revenue streams are not only conservative in rate, but also in utilization, almost

eliminating any parking cost for the City. We look forward to discussing in

detail the various assumptions that were used above.

• These ideas, and others, even those originated by other respondents, should be part of the

post-ENA discussions between City and selected developer.

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2. If the City Yards shared parking structure cannot be developed, how would your proposal be modified?

• Our modifications would come in the form of an on-site underground parking structure. This

parking structure would require the demolition of Building A (4,600 SF gallery space that was

initially set to be preserved). This garage would include roughly 250 stalls.

• There are some problems with this option that are as follows:

• The construction of the parking structure would not accommodate any City Yards employee

parking.

• The size of this underground garage would require the use of off-site parking to

accommodate larger cultural and community events.

• Vehicle traffic would not be eliminated on the Bergamot Station site. This is a goal of ours

so as to enhance the bicycle and pedestrian experiences.

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FINANCIALS

The Bergamot Station Arts Center RFP stated that the development must produce annual ground lease payments for the City based on fair market values.

1. Please reconfirm what the proposed total annual ground rent for the City will be for the duration of the lease, net of any charges for City employee parking (if your proposal is tied to shared parking at City Yards), or other credits or deductions that you are projecting. •

• The starting ground rent for the City commencing in 2018 will be $700,000/yr

increasing annually by 1%, compounded every 5 years. If the retail space located at

the project generates an amount in excess of our projections, we would share 50% of

those net revenues with the City. The total ground rent for the City over the

term would be a minimum of $49,986,934. We are open to discussing additional

suggestions to increase revenue to all the parties.

2. Please provide a concise list of the proposed project’s public benefits to the City, including the monetary value of each benefit. Please identify any assumptions used in your calculations. • Our proposed project provides the following public benefits:

• Arts

• New permanent home for Museum - SMMoA

• Below market rents for the gallery spaces assisting them to be successful and for

us to be able to attract a diverse base of outstanding gallery operators, not just

those that can pay the highest rents

• Arts Management of Outdoor Spaces for Cultural and Community Events

• Unique, arts-centric connection to light-rail. Opportunity to encourage traffic-reducing

rail transit to arts venues, special events, and hotel/restaurant amenities.

• Community Meeting Room

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• Alternate Transportation

• Bike Center

• Bike Share

• Bike Path

• Town Square and Public Courtyard (133,164 SF) - Creation of a true town square for

community use both organically and organized

• Public Areas with Restrooms

• Site Porosity (Connections to the Neighborhood and City)

• New union hotel located away from beach and downtown areas

• Employment opportunities for Santa Monica residents

• Potential arts management, hotel management and restaurant management programs

for Santa Monica High School and Santa Monica College students

• Improved pedestrian-oriented design frontage along 26th Street and Olympic Boulevard

and welcoming design connection to Expo stop

• Activate Michigan Avenue and encourage pedestrian-oriented uses (particularly if

utilizing a parking structure at City Yards)

• Shared-Use parking options

• Control ground water runoff from existing large impervious site

• Provide new development without displacing local businesses

• Economic benefits to City (see below)

2. Continued

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FINANCIALS (continued)

The Bergamot Station Arts Center RFP stated that the development must produce annual ground lease payments for the City based on fair market values.

3. Please provide additional detail regarding the projected economic benefits to the City, including the fiscal benefits produced by the proposed project on an annual basis after project stabilization (i.e. Sales Tax, Property Taxes, Transient Occupancy Taxes and any other ongoing City revenues). Please identify any assumptions used in your calculations.

Bergamot  Station  Tax  Revenues  Upon  StabilizationBergamot  Station  Project

Rooms  Revenue $9,506,767TOT  Rate 14.0%TOT  Generated  (rounded) $1,330,950

$40,000,000  +  $3,000,000Sales  Tax  Revenue  (Art  Galleries,  Restaurants,  Non-­‐Food  Retail,  Other)   $43,000,000Tax  Rate 1.5%Sales  Tax  Generated  (rounded) $645,000

Real  Estate  Tax   $909,527Percent  to  City  of  Santa  Monica  local  agencies 17.10%Property  Taxes  Generated  to  the  City $155,529

Hotel  Gross  Revenue $14,730,767Business  Tax  Rate  1 $1.25Business  Tax  Generated  to  the  City $18,519

$159,433  +  $393,000Stabilized  Utility  Expense  -­‐  Bergamot  Station  Tenants  +  Hotel $552,433Utility  Tax  (10%) $55,243

Stabilized  Parking  Revenue $435,090Parking  Tax  (10%) $43,509TOTAL  MEASURABLE  TAX  REVENUES  to  City  of  Santa  Monica  local  agencies  (rounded) $2,248,7601  Tax  equates  to  $180.80  for  the  first  $60,000  in  Gross  Revenues  plus  $1.25  per  additional  $1,000  of  gross  revenues  over  $60,000.

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re:envisionbergamot:station ARTS CENTER MANAGEMENT

As part of the Exclusive Negotiating Agreement, staff will recommend to Council that the selected developer be required to submit an annual Performance-Based Art Center Management Plan to the City’s Cultural Affairs Department.

1. State your understanding and willingness to commit to producing this annual plan for the duration of the ground lease. What performance measures would you recommend be included in the Arts Center Management Plan? • We are prepared and willing to submit an annual Arts Center Management Plan to the

City’s Cultural Affairs Department. We would be open to discussing various performance

hurdles but would imagine they could include: number of events held, amount of visitors

to the site, and SMUSD participation in events at the property.

2. The RFP also states the goal of retaining existing arts center tenants and the requirement of providing core and shell space for the SMMoA. Can you clarify your team’s intent to meet or exceed these requirements? • Our goal and expectation is to retain all existing galleries and all existing tenants at

Bergamot Station. As the founder of Bergamot Station, Wayne Blank has attracted

every current tenant since he started his partnership with the City of Santa Monica.

With his knowledge base and his role as an integral part of our team, it makes us

uniquely qualified to handle the transition. We feel that Bergamot Station is an arts and

cultural destination that is committed to preserving this DNA and community fabric by

all means necessary. Our team feels Santa Monica Museum of Art is the gateway into

Bergamot Station. We are committed to providing Santa Monica Museum of Art with a

core and shell of a signature building.

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ARTS CENTER MANAGEMENT (continued)

As part of the Exclusive Negotiating Agreement, staff will recommend to Council that the selected developer be required to submit an annual Performance-Based Art Center Management Plan to the City’s Cultural Affairs Department.

3. Please elaborate on the transition from an interim arts center management and marketing strategy with the existing operators, Bergamot Station LTD and its subtenants, to your team’s long-term arts center management strategy, including details on staffing. • We are uniquely positioned to create a smooth transition at the property as principals of

Bergamot Station LTD are members of our team. This is critical as existing tenants

would need to extend their leases as they come due over the next four years of their

existing lease term. We would be in a position to begin implementation of our Arts

Center Management program prior to the transition date. We have attached an

organization chart for the Arts Center Management Team and we would be prepared

to bring that team on as soon as we are selected.

• Please see Staffing and Organizational Chart

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re:envisionbergamot:station  

BERGAMOT  STATION  STAFFING  AND  ORGANZATIONAL  CHART  

   

 

Bergamot  Sta+on  Development  Team  

Design,  Development,  and  

Construc+on  

General  Contractor:  Krismar  

Construc+on  Architect:  Frederick  Fisher  &  Partners  

Landscape  Architect:  OJB   Hotel  Partner:  SBE  

General  Manager,  Overall  Site  Opera+ons  

Site  Management  Staff  

Property  Manager  

Property  Administrator   Site  Engineer   Property  

Accountant  Parking  and  Security  

Arts  Management  Staff  

Galleries  &  Art  Related  Uses  

Arts  Curator  Gallery  

Administrator    

Arts  and  Cultural  Event  Programming  

Program  Director   Events  Coordinator  

• Implementing

marketing strategies

• Recruitment and

retention of galleries

• Cultivating the

relationships and

addressing the

unique needs of

the galleries

• Preparation of the

annual Arts Center

Management Plan

to the city

• Coordination

with the city and

other arts/cultural

organizations

including SMMoA

• Collaboration

with CARS

• Coordination

of logistics for

all events at

Bergamot Station

BERGAMOT STATION STAFFING AND ORGANIZATIONAL CHART

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CREATING A VIBRANT, ICONIC DEVELOPMENT

The RFP provides the opportunity to create a unique and “iconic transit-adjacent, urban infill gateway development that will further elevate the role and status of the Site in supporting the arts in the region.”

1. Confirm the buildings on Site that your team will be preserving in place, including the total square footage preserved, and the amount of proposed investment (on a per square foot basis) to improve the existing buildings.

• We will preserve four existing buildings: A, B, E, and F. They total 41,700 SF.

(As referenced on page 80 of our RFP). We plan on spending $770,935

on the core and shell improvements of these existing buildings, along with

$1,595,985 for site work and landscaping around these preserved buildings.

This equates to $57 per square foot.

• Please see Site Diagram

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H - HOTEL/MIXED USE83,000 SF

M - MUSEUM21,100 SF

B - EXISTING GALLERY24,000 SF

C - CREATIVE OFFICE67,000 SF

E/F - EXISTING GALLERY13,100 SF

D - BIKE CENTER/RETAIL7,600 SF

A - EXISTING GALLERY4,600 SF

NEW BUILDINGS / 178,700 SFEXISTING BUILDINGS / 41,700 SF

EXISTING VS. NEW BUILDINGS

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Krismar ConstructionWorthe Real Estate GroupWayne Blank, Bergamot Founder