BIJOU THEATRE AND RETAIL DEVELOPMENT PROJECT

Purpose:

To provide information for the City Council to determine whether or not to allow Lot B to be leased to the developer in order to build a multi-use office, retail and theatre project.

Background:

As you are aware, the City Council imposed a moratorium on certain historically significant buildings and uses in the downtown area. The Bijou Theatre was included in that moratorium. The theatre and part of the office and retail uses have been restricted in order to comply with the seismic retrofit ordinance. The Bijou was purchase by CIM Group in September of 1997. They have developed a proposed to use Lot B as part of a plan for all the property from Hermosa Avenue to Beach Drive. A copy of their overall proposal has been distributed to you before and a drawing is attached.

The plan includes rehabilitating the Bijou building and using it for retail and office tenants, a new building that would contain a four screen theatre and additional retail that would front on 13th Street. The total land area, including Lot B, is approximately 37,908 square feet. The project needs Lot B in order to attempt to meet the parking requirements which would allow 94 parking spaces to be built below grade. The project would also need to process 11 in-lieu parking spaces in order to meet the overall parking requirement. The use of Lot B is key to the overall project. It is proposed that a long term ground lease be executed to effect the project.

This project, if built, would add retail uses to the downtown area. Several national chain retail outlets have been mentioned as possible tenants and the proposed spaces would work for them. It would also bring the theatres back to the downtown with a respected theatre operator and additional office space that will attract daytime users of the downtown area. The project would also add sales and property tax revenues. The proposal is to do the project in phases, with the rehabilitation of the Bijou first as an office and retail building. If the City Council is interested in this concept, then several items must be set into motion:

1. Staff should be directed to negotiate a project and parking agreement with the developer incorporating the use of Lot B and protection of the architectural features of the Bijou building.

1. Staff should be directed to process plans and permits for the seismic upgrades on the Bijou building, including conversion into a retail and office complex. (This would mean that the moratorium would have to be modified or lifted on the Bijou building.)

1. Staff should be directed to begin work on the overall project, including processing an EIR.

This is a very complex project. The developer has been attempting to purchase other properties to make the theatre portion of the project work. I believe that without City Council direction on the theatre issue, they would not include it in the project. However, it clearly adds an important element for the downtown and the City.

Staff needs to know whether or not the City council is interested in using Lot Bin the concept outlined. If you believe that this approach is one that is consistent with the overall goals of the downtown, staff should be directed to return with a proposed project and parking agreement that spells out all of the details for your review and approval.

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