SR-08-14-2012-3OID
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�.. City of City Council Report
Santa Monica'
City Council Meeting: August 14, 2012
Agenda Item: 3-<-j
To: Mayor and City Council
From: Rod Gould, City Manager
Subject: License Agreement for Visitor Center in the Carousel Building
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a license agreement with the Santa Monica Pier Corporation (SMPC) to
operate a visitor center and gift shop in the Santa Monica Pier Carousel Building under
the terms and conditions specified in this report.
Executive Summary
SMPC FY 2012/13 work plan, on the August 14, 2012 agenda, calls for the
establishment of a visitor center. The northwest corner of the Santa Monica Carousel
building has been identified as an appropriate location. The visitor center would include
rotating museum exhibits and gift shop where visitors can find historical information,
guided tours, and purchase Santa Monica Pier and Carousel related memorabilia.
The visitor center would replace the current tenant, a gift shop operating under a month
to month tenancy cancellable on 30 day notice. The visitor center would pay a monthly
license fee to the City commensurate with the gift shop's rent ($10,479 annual rent in
FY 2011 -12) so there would be no loss in revenue to the Pier Fund. Additional revenue
from the visitor center and gift shop would help support SMPC's operations.
Background
The Carousel Building also known as Loof Hippodrome is listed on the National Historic
Register, and serves as the Santa Monica Pier's principal stylistic and historic element
as well as an important focal point for the Santa Monica community. In addition to the
vintage wooden Carousel, the building's first floor houses an `old fashion' soda fountain
and a gift shop.
1
The SMPC, a nonprofit organization, operates under a Services Agreement approved
by Council on February 28, 2012, and is charged with developing and implementing
marketing and community programing on behalf of the City for the benefit of the
residents and the millions of annual visitors to the Pier. The SMPC believes a visitor
center at this location would have a positive impact on the visitor experience, deepen
residents and tourists' appreciation of the Santa Monica Pier, and generate revenue
through the sale of Pier and Carousel related merchandise.
Discussion
The Santa Monica Pier Leasing Guidelines approved by Council on February 28, 2012,
establishes the preferred uses for each commercial area on the Pier. The Guidelines
designates the preferred use for the retail space inside the Carousel Building for
"Carousel- related and general souvenir, gift items and books featuring local history and
themes ".
The proposed visitor center and gift shop would be open seven days a week year -round
from 11:00 AM to 5:00 PM weekdays and 7:00 PM weekends, with later closing times
during the summer months. Visitors would view historical exhibits, artifacts, and
artworks curated by the SMPC's Pier historian and find a selection of high quality gifts
and souvenirs for purchase. In addition, the SMPC would use the center as the starting
point for volunteer docent -lead and self - guided tours, and for other services currently
offered by the SMPC such as booking children's birthday parties at the carousel and
sale of commemorative plaques.
The SMPC would at its cost make internal improvements, add new signage and reorient
the entry point to make the center more easily identified and inviting. In the FY 2012/13
proposed budget SMPC has allocated $30,000 for the visitor center set up costs and
$60,000 for ongoing costs. Exterior modifications including signage would be subject to
Landmark Commission approval.
2
Staff recommends that Council authorize the City Manager to negotiate and execute a
license in accordance with the following major terms conditions:
Premises: 200 Santa Monica Pier (260 square feet).
Term: One -year term commencing upon execution of license.
Term Option: Two six -month extensions.
Licensee Fee /Rent: The greater of monthly base rent or 9% of monthly gross
receipts. Base rent schedule shall be:
$582 per month for Jan, Feb., March;
$873 per month for April, May, June, Oct., Nov., Dec.;
$1,165 per month for July, August, September.
Early Termination: If for budgetary or operational reasons SMPC is unable to
maintain the Center, SMPC or City may terminate the
agreement with 60 days written notice.
Commission Action
The SMPC FY 2012/13 work plan and budget approved by the SMPC Board on May 21,
2012 includes the operation of a visitor center.
3
Financial Impacts & Budget Actions
Staff projects minimum annual revenue of $10,479 from the visitor center and gift shop
base rent; the City could receive additional revenue should monthly gross receipts
return a higher number. This revenue is included in the FY 2012 -13 adopted budget at
account 30626.401830 —Vendor Rent.
Prepared by:
Elana Buegoff, Sr. Development Analyst
Approved:
Forwarded to Council:
Rod Gould Rod Gould
City Manager
Attachments:
City Manager
Attachment A. SMPC Visitor Center Business Plan
11
Santa Monica Pier Corporation
April 2012
With well over 6 million visitors per year from around the globe, the Santa Monica Pier is a major tourist
destination. However, there is no central place for visitors to go for historical information, insightful way -
finding, guided tours, or to purchase unique, collectible Santa Monica Pier - specific memorabilia. The Pier Comer
Visitor Center will serve as a much - needed one -stop information center, museum, and gift shop for Pier and
Merry -Go -Round patrons. As the recent Centennial Celebration and the book Santa Monica Pier: A Century on
the Last Great Pleasure Pier demonstrated, there is a definite and growing public yearning for acknowledgement
of the past and present relevance of the Pier. The Visitor Center will satisfy that yearning through its offering of
historical tours, its display of museum - quality memorabilia, and its tasteful selection of gifts and art.
Owned and operated by the Santa Monica Pier Corporation (formerly Santa Monica Pier Restoration
Corporation, or PRC), the Visitor Center will serve as the Santa Monica Pier service provider,
museum, and gift shop for Pier- and Merry -Go- Round - specific events and memorabilia.
Pier Corner will be the "go -to" source for planning private or semi - private events in the Merry- Go-
Round or on the Pier, from birthday parties to promotional activities. The management, booking, and
planning of events in the Merry -Go -Round and on the Pier will be handled by PRC staff through the
Visitor Center. Visitor Center staff will be on hand to assist in execution of events, from setup to
breakdown.
The PRC is developing an ambassador program as well as docent -led and self - guided historical Pier
tours. Those interested in leaming more about the Pier's history will be able to purchase a docent -
led tour at the Visitor Center. Those wanting to see the Pier at their own pace can purchase headset
rentals for a pre- recorded self - guided tour.
The Visitor Center will also act as a home base for volunteer ambassadors to store uniforms and equipment.
Unique retail items such as Pier- and Merry -Go- Round - related books, clothing, historic photographs and
postcards, art, and gift items will be sold in the Visitor Center. Customized gifts will also be available. The PRC
will develop community -wide artist contests to generate distinctive pieces of artwork that are reflective of the
Pier, or incorporate physical pieces of it, such as used plank boards, that will be for sale in the Visitor Center.
The Santa Monica Pier has a long and rich history, yet no museum space to display historical memorabilia or
inform visitors of its past. A Visitor Center with historical items will cater to curious first -time visitors as well
as local residents who want to reflect on their past experiences at the Pier. By offering historical tours and
displaying memorabilia, visitors will have a chance to learn about the history of the Pier; this experience is
offered nowhere else and is something only PRC staff and volunteers can provide.
The Pier is a unique and extremely popular public space, yet there is currently no retail outlet for
purchasing quality, unique Pier and Merry -Go -Round gifts and artwork. The Visitor Center will
occupy a niche market for visitors and patrons wanting to take a "piece of the Pier" home with them.
The target market is the dedicated Santa Monica Pier enthusiast. This applies to locals and tourists
alike. The shop is not in direct competition with other shops on the Pier in that its focus is not on
everyday beach and tourist items such as towels, toys, suntan lotion, and disposable cameras. Instead,
the Visitor Center appeals to the person who wishes to find unique and collectible items dedicated to
this popular and special destination.
Al 1r,14 REV I
The comer of the Merry -Go -Round building is an ideal location for a welcoming Visitor Center, attracting visitors
both as they arrive on the Pier and as they leave at the end of the day. This high visibility location will be
a large part of the Visitor Center's marketing strategy; other aspects include
press releases and public relations efforts, especially related to artist
competitions, and integration with the Pier digital media outlets such as its
website, social media networks, and e- newsletters.
The PRC has long been a part of preserving the Pier; it
recently produced a history book, entitled The Santa Monica
Pier: A Century on the Last Great Pleasure Pier (Angel City
Press, 2009), and has throughout the years collected historical
Pier memorabilia. As part of the annual Santa Monica Pier
Paddleboard Race & Ocean Festival, the PRC coordinated a
"pop -up museum" that drew strong interest from Pier
visitors. Historical tours are currently offered on a limited
basis and staff is knowledgeable not only in the history of
the physical structure of the Pier, but also in the significant
events that have taken place here.
The PRC has been successful in retail sales both at events and online,
and has efficiently and professionally coordinated events on the Pier
and in the Merry- Go -Round building. Staff is knowledgeable in Pier
operations and history and is well- connected to the community. PRC
staff also has extensive experience in promoting and marketing special
events for private promoters as well as community groups and individuals.
The Visitor Center is a natural extension of the Santa Monica Pier Corporation's
current responsibilities and would greatly benefit patrons who wish to enrich their
experience on the Pier.
Reference Contract No.
9630 (CCS)