NEW BUSINESS  13.

COMMITTEE MEMORANDUM

HISTORY:

Miami Film Society, Inc. d/b/a Miami Beach Cinematheque (“Cinematheque”), a nonprofit 501(c)3 organization, currently occupies approximately 2,523 square feet on the ground floor of Historic City Hall, located at 1130 Washington Avenue.  The lease agreement, dated December 9, 2009, is for an initial term of three (3) years, with two (2) renewal options for a period of three (3) years each.  The second renewal option is scheduled to expire on February 28, 2019. 

For a brief period in 2013, Cinematheque held a concession agreement with the City for operation of an outdoor café in the adjacent courtyard outside the premises and immediately south of the Historic City Hall building.  The outdoor café component was not a successful operation and Cinematheque terminated the concession agreement after several months.  In another effort to help the nonprofit boost revenue and pay rent during the initial term, the City Commission adopted Resolution 2014-28790, allowing for alcohol sales and onsite consumption at the premises during film screenings only. 

On December 17, 2018, Cinematheque advised the City it no longer desires to remain in the premises after expiration of its current lease (Attachment 1).  Cinematheque further advised the City about ongoing discussions with Living Arts Trust, Inc. d/b/a O Cinema for O Cinema to become tenant and operate the cinema upon expiration of Cinematheque’s lease.

On January 3, 2019, staff met with representatives from O Cinema to discuss various terms and conditions of a potential O Cinema lease of the premises.  While staff continues discussions with O Cinema, Cinematheque has requested to remain in the premises on a month-to-month basis under revised lease conditions.

On February 13, 2019, the City Commission referred to the Finance and Citywide Projects Committee a discussion regarding O Cinema taking control of the space to operate a cinema.

ANALYSIS:

In a formal proposal dated February 4, 2019 (Attachment 2), O Cinema requested to take over the space from Cinematheque pursuant to a new lease agreement.  O Cinema seeks terms more favorable than those contained in the Cinematheque lease:

Term and Renewals.  O Cinema requests “A Nine (9) year Lease Term with an option to renew.” To satisfy Code requirements regarding the lease of public property, staff recommends a three (3) year initial term, with the City’s option to renew for two (2), three (3) year terms, by providing O Cinema with not less than 180 days written notice prior to the expiration date of the initial term or any renewal term

Premises. In addition to the interior premises occupied by Cinematheque, O Cinema requests use of the outdoor courtyard adjacent to Historic City Hall, with permission to install tables and chairs for events. The venue is not a hall for hire and staff recommends that the outdoor component only be operated during normal operating hours and in conjunction with film screenings.

Use Fees.  Cinematheque currently pays the City a total amount of $57,511 annually ($4,792.60 monthly) for base rent, maintenance, and insurance.  O Cinema requests that the City provide the premises free of charge in exchange for providing the public benefits outlined below.

Benchmarks.  O Cinema proposes the following public benefits: (1) “Celebrate Miami Beach,” an annual cultural screening event offered free of charge to the community; (2) 100 free tickets annually for seniors; (3) 100 free tickets annually for youth; and (4) 20% discount offered once a month to Miami Beach residents.

Alcohol Sales.    O Cinema proposes acquiring all pertinent alcohol licensing from Cinematheque for continuation of beer and wine sales in conjunction with film screenings. O Cinema does not propose sharing any percentage of revenue with the City, but it will be obligated to remit resort taxes on concession sales. The Administration recommends that alcohol not be permitted served or consumed in the outdoor courtyard.

In its December 17^th nonrenewal notice, Cinematheque further asked that starting on March 1 and until such time as O Cinema is operating the space pursuant to a new lease, Cinematheque be permitted to remain as tenant on a month-to-month basis. Citing the rent paid by the City’s other ground floor tenant in the building, MDGLCC Foundation, Inc. d/b/a Miami-Dade Gay & Lesbian Chamber of Commerce, Cinematheque has asked that its total rental fees owed to the City be reduced by approximately half from $4,792.60 to $2,500.00 per month.

CONCLUSION:

The Administration seeks direction regarding O Cinema’s request for a new lease pursuant to the proposed terms,  as well as direction regarding Cinematheque’s request for a rent reduction in the interim holdover period.