Attachment B


Santa Monica Civic Auditorium Renovation and Repurposing

Frequently Asked Questions (FAQ’s)


Where did the recommendation come from?

The future of the Santa Monica Civic Auditorium has been an important component of a number of recent community planning initiatives.  They include the Civic Center Specific Plan (2005), the City’s adopted cultural plan, Creative Capital (2007), which held a series of focus groups on the Civic, and the Santa Monica Redevelopment Agency’s 2009 five year implementation plan.  Each of these processes confirmed the community’s desire to see the venue refurbished and brought to life as the cultural heart of the Civic Center area, as a venue for large musical performances and cultural events. 


What is the proposed deal with Nederlander?

The proposed Exclusive Presenter/Joint Venture model invests the Nederlander Organization, a top industry promoter, in the success of the venue and ensures that the City shares in that success based on a net profit sharing formula.  The City would continue to manage the venue and Nederlander would use its industry connections to book the venue.  The proposed deal term is 10 years from completion of the renovation. The Council approved the partnership model with Nederlander, the major deal terms and the minimal performance levels at its March 8, 2011 meeting.


Is there a loss prevention clause?

A final agreement has not been negotiated, the current term sheets states that after the first three year period, Nederlander could be terminated if it failed to achieve a net gain for any two consecutive year period.


Would the City still need to subsidize the Civic Auditorium?

The City’s overhead (2/3 of which are staffing costs) is such that the venue would still require a subsidy of $0.8M to $1.4M annually when averaged over the first 10 years.  The City subsidy is projected to decrease over 33% over the ten year term; compared to a 64% increase with the Status Quo model.


What about capital reserves?

The projected subsidies include an annual allocation to a capital reserve fund of $500,000 for a facility renewal program.


Who will determine what events will take place at the Civic?

Both the City and Nederlander will discuss and review regularly the types of events at the Civic.


What would take place at the Civic Auditorium?

In soliciting proposals, the City stated that it wanted a mix of events, much broader than what has been at the civic in recent years, yet while also preserving local tradition.  Once renovated the Civic Auditorium would host a mix of concerts, theatrical performances, and special events, including film screenings, award shows, consumer shows and corporate events.  It would also continue to host key community events such as Stairway and the Santa Monica Symphony.


What is the time frame?

The Civic would close in the winter of 2012 with construction to begin soon thereafter.  Construction is estimated to last 18 months to two years.   



What will the renovation include and what will it cost?

Once renovated the Civic Auditorium would become a state of the art mixed use facility while retaining its notable characteristics such as the façade and the hydraulic floor.  Anticipated improvements include a flexible seating system, much enhanced technical capacity (modern sound, lighting, projection, etc.) and improved public spaces.


The total cost is estimated at $46.7 M – which includes infrastructure improvements to address ADA accessibility and retrofits for earthquake safety in conformance with the Secretary of the Interior standards for historic preservation for an estimated $25M.  The balance includes soft costs and substantial technical and “green” improvements to the facility.  The City has issued a “request for bid” which will be available in a few months.


Has this cost increased?

In preparing the Santa Monica Redevelopment Agency’s 2009 five year implementation plan, a preliminary estimate was developed for the improvements to the Civic Auditorium.  That estimate was for $55M, towards which Council allocated $25M in 2009.


What about parking?

The proposed Nederlander deal calls for 1000 adjacent parking spaces on nights and weekends, and 630 spaces on weekdays.  Replacement parking may become necessary if the City redevelops the surface lot in the future.  The City retains all parking revenue.


What about revenue from naming rights?

The estimated revenue from title sponsor naming rights is $1M to $2M total over a ten year period.  An aggressive campaign that named virtually all the spaces in the Civic Auditorium could generate additional revenue.


What if the redevelopment funds were used to build Parking Structure 6?

One of the alternatives discussed by Council is to apply redevelopment funds toward the construction of Parking Structure 6, estimated at between $40 and $43 million.  The current financing plan for Parking Structure 6 anticipates that increased parking revenues, Parking Authority funds and Downtown parking in-lieu fees will finance the construction of the structure. 

If redevelopment funds were used to fund all or part of the construction of Parking Structure 6, the report mentions that the parking funds that would otherwise be applied to the financing of Parking Structure 6 could be applied toward the creation of public parking at Fourth Street / Fifth Street / Arizona Avenue.  The staff report mentions that the transfer of funds could reduce the pressure to create sufficient development value on the site to pay for the desired public parking.   

There are other means available to the City to finance public parking, as identified in the Downtown Parking Strategy.  One option is to create an assessment district to support the creation of new parking resources.  The existing parking district assessment expires in 2016 and the Downtown Parking Strategy anticipated that a new assessment would be created to support additional parking resources.  Such an assessment would need to be approved by a majority of property owners to whom the assessment would be applied.  Another option recommended by the Downtown Parking Strategy is to increase parking rates to finance parking.  The full range of parking rate adjustments proposed by the Walker Parking Study has not been implemented.  Since parking rates were increased last year, occupancy has remained strong, indicating that prices have not yet reached an elasticity breaking point for most users of the parking facilities.