sr-102478-11aSanta Monica, Cali .:nia, September 5, 1978
T0: 2layor and City Council 1/
FROM: City Staff OCI 2 4 ~~
SUBJECT: Developer - Operator Skate Park
Introduction
This report presents the process followed in selecting a developer
and operator for the Skate Park to be located on the Deauville
property. It also recommends the approval of that developer and
operator and presents the recommended subsequent procedures.
Background
At the City Council's direction, a public hearing was held by the
Recreation and Parks Commission on January 19, 1978, to develop the
criteria for the development of a Skate Park. This criteria was
subsequently approved by the City Council on February 14, 1978, and
staff was authorized to proceed with the interviewing and selection
of the developer and operator of the Skate Park.
Invitations to attend a bidders' briefing concerning the project
were sent to 62 interested parties. The conference was held on
April 7, 1978. Twenty-three representatives attended this meeting.
The criteria and minimum standards approved by Gity Council were
sent to bidders in letters dated March 31, and April 11, 1978.
They are attached for Council review. The prospective developers
were requested to submit a preliminary proposal from which finalists
would be selected for a formal presentation of their proposal. .Four
proposals were received and they were invited to make formal presenta-
0~
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tions on May 8, 1978.
eptember 5,.1978
The following firms submitted detailed proposals for review:
Sparks/Endless Wave .Inc.
Recreational Systems, Inc.
Skatercross Limited
Martin Seifert and Associates
Each of the proposals and presentations were rated on the following
criteria and standards:
1. Complete proposal submitted by deadline.
2. Compliance with City requirements.
3, Experience of group in constructing. skate parks.
4. Experience of principals in skate parks development.
5. Actual operating experience.
6. Financial ability of principals and evidence of credit.
7, Financial return to City.
8. Amount of investment.
9. Preliminary design concept.
10. Preliminary operating program statement.
11. Presentation.
Based upon these criteria, the presentations and proposals were
ranked independently by the Director of Recreation and Parks and the
Recreation Superintendent. (see attached ranking sheet.) Staff
then discussed each proposal's differences and as a result Sparks/
Endless Wave Inc. is considered to be the best proposal for the City
of Santa Monica.
Skate Park Proposals Ranking Sheet
Note: All proposals were ranked on a 4 to 1 point total. Best
proposal ranked 4, next ranked 3, etc. In cases of ties
the point totals were split.
Sparks/ Skater- Recreational
Endless Seifert cross Systems
Wave Assoc. Ltd. Inc.
1. Complete program proposal
submitted by deadline. 4.0 1.0 3.0 2.0
2. Compliance with City
requirements (Due to no.
separate ranking sheet
with double point value). 7.0 2.0 7.0 4.0
3. Experience of ~rouP in
construction of skate
parks. 4.0 1.0 2.5 2.5
4. Experience of principals
in skate park develop-
ment. 3.5 1.0 3.5 2.0
5. Actual skate park oper-
ating experience. 3.5 L 0 3.5 2.0
6. Financial ability of
principals and evidence
of credit. 2.5 2.5 2.5 2.5
7. Financial return to City. 4.0 3.0 2.0 1.0
8. Amount of investment. 1.5 3.0 1.5 4.0
9. Preliminary design
concept. 3.0 1.0 2.0 4.0
10. Preliminary operating
program statement. 3.0 1.0 4.0 2.0
11. Presentation. 4.0 1..5. 3.0 1.5
Total Points 39.0 19.0 34.5 27.5
Ranking 1 4 2 3
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Sparks Inc. has complied with all provisions of the criteria and
in addition increased the requested annual minimum from $18,000 to
$24,000, the precentage of the gross from l2% to 12.5%. Based upon
their projected use, the projected revenue for the City is approximately
$78,125 at 12 1/2i of the gross. Their anticipated gross is $625,000.
Developer's' Qua Tif'icatohs
Sparks, Inc. and Endless Wave Skatepark, Inc. are prepared to invest
$350,000 in building and opening the Santa Monica Skatepark. Sparks
and Endless Wave jointly are the largest park operators with the most
experience in the country. They operate three parks, one of which was
the first Skatepark in the country and has been open for more than
two years. These parks are all full-size, multi-event parks which
have proven their popularity both in design and operation. Each of
the parks they operate is large enough for them to conduct a full
operating program such as we have outlined for the Santa Monica Park
and, unlike most other Skatepark developers, they have real experience
in providing the kinds of programs outlined here and that are appropriate
to the Santa Monica Skatepark. .Staff knows of no other park developer
which has this actual experience in operating such programs.
Site development, excavation and concrete work will be done by in-house
crews working closely within-house designers who have been involved
in the construction of 25 different: parks. Staff feels that the
experience in construction is as important as having a good design to
begin with because construction and design considerations are so
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ptember 5, 1978
closely related. Staff believes Sparks is the most experienced and
professional organization in skatepark design and operation.
Staff estimates it will take six months from the date of City and State
approvals to opening the skatepark.
Background of Principals
Clay T. Whitehead is President of Sparks, Inc., a new Santa Monica
corporation engaged in building and operating skateparks. Mr. Whitehead
received his B.S. and M.S. degrees in electrical engineering from the
Massachusetts Institute of Technology in 1960, and later earned his
Ph,D, in management, also from M,I.T,
Marshall A. Rockwell, i~.D. is Chairman of the Board of Directors of
Sparks, Inc, Dr. Rockwell is Medical Director of the Emergency Depart-
ment at Santa Monica Hospital. He has just completed authorship of
the first clinical study of skateboarding injuries, which is currently
being revised for publication in the Journal of the American Medical
Association,
Mr, Edmund C. Olson is President of Superior Gunite, located in North
Hollywood. Superior Gunite and its affiliated subsidiaries have
been involved in the construction of 31 skateparks located throughout
California, Nevada, and Arizona. As President of Endless Wave Skate-
parks, he has designed, built and presently operates two facilities
in Southern California, He presently has five new parks in various
stages o£ construction, with four more in preliminary contract and
design phases,
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Se. ember 5, 1978
Program
The size of the park site is just large enough to permit enough
variety in the skating surfaces so that a wide segment of public
interest in skateboarding can be accommodated.
The main activity of the park will be general admission skateboarding,
In addition to skateboarding, there will be roller skating, Pro Shop,
food service, and bicycle rentals.
Skaters will have to join a Membership Program in order to skate at
the park. This is a common practice in almost all skateparks today as
it assures that they will have a record of the skater's name, parent's
permission to skate, the name of the family doctor from the parents
for emergency medical treatments,. In addition, the Membership Program
helps maintain control of unruly skaters since each skater is known
by name and can be excluded from the park effectively by revocation
or suspension of membership.
Lessons will be available for beginners, intermediate, and advanced
skaters: Advanced lessons in specific techniques will be given by
professional skaters. Professional skateboarders will be brought in
from time to time for demonstrations, discussions, autographs, and to
give local skaters a chance to skate with them.
Contests will be held for skaters to measure their progress and to help
prepare for amateur or professional competitions. The Santa Monica
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ptember 5, 1978
Skatepark will affiliate with one or more contest circuits, and they
expect it will become a major attraction on the skateboard competition
circuit generally.
There will be a local manager with responsibility solely for managing
the Santa Monica park.
Economic Factor
They have based their calculations on the assumption that the Santa
D4onica Skatepark can accomodate 100 skaters at a time. The park will
not be operating at maximum capacity at all times of the day or all
days of the year. Sparks Skatepark will break even at approximately
25 percent utilization of capacity.
Total Revenue and Expense Summary (annua )
Revenue
Admissions $220,000
Food Service 260,000
Bicycle Rental 28,000
Pro Shop Sales 90,000
Safety Equipment Rental 12,000
Other 15,000
625 000
Expenses
City of Santa Monica (122%) $ 78,000
Food Service 105,000
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Expenses - con't
Inventory of goods $ 90,0.00
Sales Tax (admissions on1yJ 6,000
Safety Equipment 10,000
Salaries, management 98,000
Accounting, legal, advertising 20,000
Security, trash, maintenance 18,000
Park and Structure Debt Service 55,000
Insurance 33,000
Utilities 8,000
Property taxes 12,000 $533,125
Net Income $ 91,875
Construction Cost Estimates
Site Development $ 10,000
Excavation 30,000
Skating Surfaces 50,000
Drainage 4,000
Landscaping and Fencing 25,000
Lighting 12,000
Sound System 5,000
$136,000
Building $ 80,000
Decks and Walks 30,000
Restaurant Equipment 30',0'00
$140,000
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Other Construction Expense
Contingencies
Start-up Expense
$ 30,000
$306,000
30,000
10,000
$346,000
Alternatives
1. Council may approve Sparks Inc. as the developer/operator
of the Skatepark at the Deauville site based upon a minimum
of $24,000 annually and 122% of the gross and direct the City
Manager to negotiate the .terms of the contract.
2. Council may reject staffs recommendation and request readvertise-
ment.
3. Council may reject all bids and discontinue the project.
Recommendation
Staff recommends Alternative No. 1 approving Sparks, Inc. as the
developer/operator for the Skatepark and direct the City Manager
to negotiate the terms and conditions of the contract.
Prepared by
Donald T. Arnett, Director
Recreation and Parks
ptember 5, 1978
DTA:pp
Attachment