SR-20080513-1G~~~
City Council Report
City of
Santa Mon?ca
City Council Meeting: May 13, 2008
Agenda Item: ~ _
To: Mayor and City Council
From: Robert Trimborn, Acting Airport Director
Subject: Approval of Location and Operation of the Museum of Flying.
Recommended Action
Staff recommends that the City Council:
1) Approve the. designation 3090/3100 Airport Avenue as the new location for the
construction and operation of the Museum of Flying; and
2) Authorize the City Manager to negotiate .and execute a lease agreement between
the City of Santa Monica and Museum of Flying for the operation of the Museum
at its new location on the Santa Monica Airport.
Executive Summary
Due to financial problems, the Museum of Flying ("Museum") which was formerly
operated on the north side of the Airport closed in mid-2002.. Since its closure, there
has beeh an effort to bring the Museum back to the Airport on a more economical scale
that would still showcase the long history of aviation at the Airport and in the City of
Santa Monica. Initially it had been proposed that the Museum would be relocated into a
hangar with an adjoining office and ramp space on the Atlantic Aviation parcel, but
issues arose as to its close proximity to an active jet operating area and ease of access
to the area by the general public. Subsequently two other potential Museum sites on
the south side of the Airport were examined:
One site is located directly east of the Santa Monica Air Center (Barker Hangar) and the
other at the southwest corner of Airport Avenue and Donald Douglas Loop South
(known as 3090/3100 Airport Avenue). The 3090/3100 Airport Avenue site was deemed
the more desirable of the two because of its immediate proximity to the DC-3 Monument
Plaza and Airport Park. The combination of the Museum of Flying and DC-3 Monument
Plaza would create an historical & cultural focal point on the Airport that would be easily
accessible to the public. After careful review and. analysis of the sites, staff presented
the proposed 3090/3100 Airport Avenue location to the Airport Commission which
subsequently supported the. site as the preferred alternate location-for the Museum of
Flying.
Background
The Museum of Flving
Originally founded as the Donald Douglas Museum and Library in 1974, the Museum of
Flying originally operated just south of Airport Avenue in a structure now occupied by
Santa Monica College. Ih May 1987, the City entered into a Lease modification with
Supermarine of Santa Monica that called for Supermarine to construct space for what
became the Museum of Flying. The Museum operated within the Supermarine complex
from April of 1989 when the facility was completed until it suspended operations in July
2002 -citing lack of funding sources to sustain the Museum's operational expenses
such as insurance, labor and other operational costs that would enable it to remain
open during. hours convenient to the public. Subsequently staff met on numerous
occasions with Supermarine management in an attempt to retain the Museum on the
field to display artifacts and exhibits .relevant to the history of the Douglas Aircraft
Company, the Airport and the City of Santa Monica.
With the Museum space no longer in use, Supermarine approached the City with a
request to sublease the space to a new tenant for use as an automotive design studio.
With the additional revenues generated by the new tenant, Supermarine staff indicated
that they would be willing to accommodate a reorganization of space on their leasehold.
premises to retain the Museum of Flying at no rental cost for the premises plus an
operating subsidy for the Museum for the term of its sublease with Supermarine. Initial
discussions with Supermarine focused on relocating the Museum .into ahangar/office
space directly across the ramp from its previous location; though reduced in size to
approximately 12,000 square feet, including ramp space, it was expected that the new.
location would provide valuable interaction with the aviation exhibits and related
memorabilia,
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However, the discussions revealed certain inherent problems with converting the
hangar structure into museum space, especially in an area of the ramp adjacent to the
active movement of jet aircraft. The proposed Museum location would require structural
and construction upgrades to meet applicable technical codes such as fire regulations
for facilities open to the. public. Although the aircraft display area was to be enclosed
with afence-type structure to partially shield visitors, it would still have been adjacent to
the direct impact of jet aircraft operations on the adjoining ramp.
The South Side Site Alternatives
Concurrently with the changes on the Supermarine leasehold, the south side of the
Airport was also undergoing reorganization. With the construction of Airport Park in the
southeast portion of the Airport, the Antique Mart was moved farther west to an area in
the middle of the Airport just. south of Airport Avenue. The relocation of Park's
Maintenance Division operation from 3011 Airport Avenue to another City site created
the opportunity to return the south side site to aircraft parking areas for smaller piston-
powered aircraft. It also created the opportunity to explore other site locations on the
south side of the Airport fora use that would complement the growing number of
community events and uses. After discussions with Supermarine, the Museum of Flying
and other City staff, it was decided to explore prospective South Side locations for the
Museum.
After careful review of potential sites along Airport Avenue, staff narrowed the search to
a location that would meet the need of the Museum of Flying and provide easy public
access. The first site considered was located at 3011 Airport Avenue and following
staff's review and analysis, it was decided to bring the north .and south site locations
before the Airport Commission for their review and consideration. The Airport
Commission however raised several concerns regarding the first south side site under
consideration.
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Airport Commission Review
During the July 23, 2007 Airport Commission meeting, staff presented the two proposed
site locations for the reestablishment of the Museum of Flying. The North Side option
would have moved the Museum into a 12,000 square foot hangar directly across the
Atlantic Aviation ramp from its previous location; this site was deemed the least
desirable due to structural & space limitations and adverse operational effects on
visitors because of the direct impact from jet aircraft operations on the Atlantic Aviation
ramp.
The South Side Option proposed to move the Museum into the 3011 Airport Avenue
facility directly west of the Santa Monica Air Center. This site is comprised of an
existing 6,720 square foot hangar, 2,1.09 square foot office space and approximately
one-acre aircraft parking ramp. The South Side site was deemed more desirable by
staff due to its location near a growing number of community events and uses on the
south side of the Airport; however, many of the Airport Commissioners and members of
the public felt it was. too far from Airport Park and did not provide easy access for the
general public.
Following the presentation of the staff report, the Airport Commission discussed the
attributes/drawbacks of the proposed sites and voted to recommend that staff explore
other sites on the north side of the Airport and to have it integrated it into a facility plan.
Following the July 23rd meeting staff explored other alternate locations on the north
side of the Airport as well as other potential sites on the south side.
Continuing. planning work on the DC-3 Monument Plaza led to suggestions that
development of the Museum of Flying adjacent to the DC-3 Monument at the 3090/3100
Airport Avenue site would address concerns regarding the 3011 Airport Avenue site
further to the west. Coordinating the relocation of the. Museum of Flying with the
development to the DC-3 Monument site (which was approved by City Council on
February 27, 2007) would create a site that would be easily accessible to the public,
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have ample parking, be directly across the street from Airport Park and be in close
proximity to restaurants and the Airport Administration Building.
Staff subsequently returned to the Airport Commission on September 24, 2007 with an
update on potential sites for the Museum of Flying and presented the proposed
3090/3100 Airport Avenue site for their review and consideration. The Airport
Commission voted to support the site and requested that staff return with estimated
development & operations cost -which will be brought back to the Commission
following Council approval of the site location and once construction estimates .have
been- developed.
3100/3090 Site
Under the City Council approved. Santa Monica Airport Non-Aviation Leasing Policy
adopted on November 28, 2000, the 3100/3090 Airport Avenue site is designated as a
mixed-use facility with an adjoining parking lot. The facility is not designated as an
exclusive artist leasehold space. There are currently thirteen tenants located within the
3100 Airport Avenue leasehold complex.. All existing tenant leases will expire in
February 2009 thereby. facilitating the development of the Museum of Flying. The
expiration of all the leases at the proposed site is not a unique occurrence. Many of the
leases that were prepared under the City Council approved Non-Aviation Leasing Policy
will be coming to an end at that time. Currently, thirty-six leases (artists and other uses)
are set to expire throughout the non-aviation use area of the Airport in February of
2009. All available non-aviation lease space is currently occupied and there is a waiting
list of prospective tenants.
The stated purpose of the Non-Aviation Leasing Policy was to provide leases that would
be "incubator" or "start-up" opportunities for a fixed term and then made available to a
new set of users. Tenants were advised at the time they signed their leases of the City
Council policy. There are currently 46 artist spaces in designated art use buildings
located at 3026, 3000 and 2900 Airport Avenue.
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As was previously stated, under the established Leasing Policy, lease renewals are not
automatically offered to existing tenants in order to assure that leasing of public property
optimally benefits the City and its residents. Therefore property is periodically offered on
the marketplace as a means of providing competitive access to its use, and that
property is managed with an objective of meeting the needs of the Santa Monica
community. However; the existing tenants whose leases will expire will be given the
opportunity to reapply and join the waiting list for lease space opportunities at the
Airport.
The 3100 leasehold generates approximately $20,147 in gross monthly rental -which
includes $500.00 in overnight parking fees for a limousine company tenant.
The following is a breakdown of the 3100 tenants:
31D0#A Miles Automotive Electric Vehicle Wholesale Dealer
3100#B Fallout Films Independent films
3100#C JDC Limousine Limousine Service
3100#D Timothy Carter Construction Company
3100#E Fallout Films Independent films
3100#F Bedford Artist
3100#G Drive Around the World Non Profit
3100#T1 Ted Rogers Storage Only
3100#T2 Vaupen/Fielden Artist
3100#T3 Susan Sandler Artist
3100#T4 Buttwinicks Artist
3100#T5 Dick Minium Construction
3100#T6 Leon Sankey Artist
3090 Airport Avenue is currently unoccupied. The previous tenants performed
unauthorized modifications to the facility making it structurally unsound and unfit for
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occupancy in its current condition. The Museum of Flying is proposing to revamp and
preserve the facility and integrate it into the Museum complex.
Discussion
The proposed Museum of Flying/DC-3 Monument complex located at 3090/3100 Airport
Avenue would create a cultural focal point for the Airport. It would display aircraft,
artifacts and exhibits relevant to the history of the Douglas Aircraft Company, the Airport
and the City of Santa Monica. Attached is a plot plan of the proposed Museum of Flying
site and its location relative to the DC-3 Monument.
This new alternative location has been conceptually approved by the Museum of Flying
and Atlantic Aviation and has gained support from tenants on the field. The Boeing
Employee Foundation (previously the Douglas Employee .Foundation) has indicated
their support of the location (both from a financial & operational perspective) due in part
to its location adjacent to the DC-3 Monument Plaza.
The Museum of Flying proposal provides for a minimum of $800,000 in renovations of
the facility including the construction of additional aircraft display structures. Monthly
rental is subject to negotiation should this site be selected and approved by the City
Council. Hours of operation and parking for the Museum would be coordinated with
existing neighboring tenants so as not to interfere with events and activities.
Although the recommended South Side Option is not on Atlantic Aviation's leasehold,
the new South Side Option is consistent with the primary concern of the prior Lease
amendment of providing a location on the Airport for the Museum and a source of
support for its operational costs. Going forward with the new South Side Option will
increase the probability that the Museum will not only re-open at the Airport, but will be
able to continue operation well into the future.
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Atlantic Aviation Commitment
The Museum Agreement and Guaranty restate Atlantic Aviation's master lease
obligation to construct a new museum structure and provide financial support through
June 30, 2015. Currently the Museum AgreemenYexpands the potential Museum sites
to 3011 Airport Avenue on the south side of the Airport. In order to provide greater
assurance that the Museum will be built and operationally funded through June 30,
2015, a Guaranty was also executed and can be invoked if Atlantic Aviation defaults on
its Lease and Museum Agreement ("Museum Agreement") obligation. Although .not a
signatory to the Museum Agreement or the Guaranty, the City is specifically named as a
third party beneficiary of the Museum Agreement and Guaranty with the right to enforce
either agreement if there is a breach. The Museum Agreement also provides a cross-
default provision that makes a breach of the Museum Agreement a breach of-the Master
Lease with the City. If the City Council approved the expansion of the acceptable sites
for the Museum td include the 3090/3100 Airport Avenue site, the Museum Agreement
and Guaranty, plus any other applicable documents, would be modified to reflect the
inclusion of the new site.
Budget/Financial Impact
The Museum of .Flying will fully fund the Museum's construction and operation over the
seven year term of a lease with the City. The proposed monthly rental is currently
$2,000 per month and is subject to further negotiations. The proposed rent takes into
account the Museum of Flying's minimum investment of $800,000 in facility
improvements amortized over the term of the lease. The impact on the Airport Fund
from the reduced rental rate is anticipated to be minimal due to corresponding increase
in rent from other leaseholds.
Prepared by:
Robert D. Trimborn, Acting Airport Director
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Approved:
Robert rimborn
Acting. Airport Director
Forwarded to Council:
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P. ont Ewell ~ -
City Manager
Attached DC-3 Monument Plaza & Proposed Museum of Flying Site-Plan
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DG3 Monument Plaza & Proposed Museum of Flying Site Plan
Reference Contract
No. 8925 (CCS).