8-4-06
Um... Plans Have Changed
Helene Hanff, in her fantastic memoir of frustrated theatrical ambition, Getting Underfoot in Show Business, recognizes only one constant in the arts. Bill Flanagan, a stage manager, told her, “In the theatre, whatever happens to you, it’s unexpected.” So, if you can predict something or even imagine the possibility of it occurring, it won’t. Normally, this law gives me lots of happy surprises; last month was quite surprising. We’ll see how happily it turns out.
The eidetically inclined amongst you will recall the announcement of our lease and address about three months ago. In truth, the lease needed one more revision. A provision regarding liability required the landlord to review his insurer’s requirements. As we were literally talking about six words, I forged ahead, confident that the paperwork would be completed “any day now…”
Now, the landlord for our property is a trial lawyer by day/property developer by night (much in the same way as I am increasingly an artistic director by day and nervous wreck at night). In consequence, he disappears for three to six weeks at a time, once vanishing for three straight months. After pursuing the elusive sentence revision for eight weeks, I finally got him on the phone.
Me: “We need to get this signed.”
Landlord: “Absolutely. Let’s get together Tuesday.”
Me: “OK, but e-mail me the revisions so I can have it reviewed by our lawyer before the meeting.”
Landlord: “I’d like to review timings first. Let’s just get together on Tuesday.”
Me: “Why don’t I bring a copy of our proposed revision?”
(beat)
Landlord: “OK”
Hmmm. I grimly prepared for the meeting. Perhaps he had run into some financing difficulties and we were going to have to delay construction. Maybe he was going to try and up the rent schedule. Or maybe I was being paranoid and he just wanted to review the construction schedule before printing clean copies for signing. So, two days later I dropped by his law offices.
Apparently, the condominiums he has been building in the adjacent property have been selling quite well and he would like to build additional units. Where?
On the theatre site.
But, asks the reader, isn’t that where the… well… THEATRE is located?
Absolutely, so the buildings would have to be torn down. And underground parking installed, and a new 16 units constructed.
All I could think was, “I’m screwed. I’ve been trusting this guy, cutting him slack regarding the lease and now I’ve lost two years and $50,000 in architectural and design costs.” Then I thought, “Didn’t I write something about the importance of WAITING FOR A SIGNED LEASE.” I mean, it’s one thing to not take someone’s advice. It’s a whole new level of obstinacy to not take your own. Without a lease, I have nothing except our personal relationship to cement the deal. Is our history together enough to convince him to leave millions of dollars on the table? Probably not. I was fairly sure I was an idiot.
Then he asked me what our ceiling heights were and hauled out a napkin from his jacket. On the napkin he had a set of calculations for maximum building height under current zoning restrictions and a sketched-out floor plan. A floor plan that included two stories of space allocated for Theater Wit. He wasn’t calling me in to dump the project, he was trying to enlist my aid and approval for any resultant delays. What?!?
We reviewed his plan. It keeps the theatre space with roughly the same square footage, but puts three stories of condominiums above us. There are separate entrances for the condominiums and the theatre, elevator access and 17’ high clear-span performance spaces. As brand new construction, his general contractor would take over the structural work and our contractor would be in charge of the finishing work. Our acoustics would be improved from the current plan, our entryway would be weakened. But, in general, the plan looks like we would come out ahead.
There are some caveats. First, it would take significantly longer to start construction. His estimate was a year; I thought the delay would be at least 16 months. There are also some serious uncertainties about the feasibility, as the landlord has a number of commitments to meet for bank financing approval. We would need to go back to the alderman and revisit the neighborhood community groups for approval. And we would incur additional costs: all the design and drafting would have to be repeated; we’d need rental space for the next season and a half. In addition, the new building could be more expensive and we might need to raise additional funds for our share. And we are in negotiation with another company to share the space. How would this delay affect them?
I was able to negotiate in broad terms for a credit to be applied toward our construction contribution for all new design work and some credits for renting another space over the coming year. As these concessions are nearly $100,000, I was quite encouraged. We outlined a brief schedule of when the various decision points would be reached over the next six months and a verbal agreement that if the landlord decided against the development project we would revert back to the original unsigned lease.
But most of my attention was actually taken with the question, “Why is he doing this?” I think he’s excited about having a theatre in his complex, but why? Just an arts lover? Why not just build condominiums? Does he need a loss to help launder money for the mob? Will I have to cast him as the lead in all my shows?
The situation isn’t that dire. Probably. I think I’ve been projecting (and in turn presenting in these articles) too bleak a picture of what a theatre can offer a canny landlord. In our case, he knows we’re in for a 10 to 15 year commitment and will be a largely self-sufficient tenant who can provide a steady stream of revenue. Second, the restaurant lease he has in the other commercial space is contingent on our presence. Third, the space has been presented to the alderman as a live performance venue, with all the neighborhood development potential that implies. Theatres attract bars and restaurants in time, they encourage street traffic, etc. The presence of the theatre is also a unique selling point to his condominium customers, many of whom are young, first-time buyers.
So, maybe theatres aren’t beggars at the gates. Maybe we don’t have huge amounts of money, but what we lack in cash we make up in cachet. We’ll see. There’s a tremendous amount of negotiation to take place over the next 45 days. We need to get something on paper from the owner, obviously. We need to set up some parameters for the financial commitment to the new build and we need to redesign our entire space for the new footprint.
So, back to the drawing board. We’ll see how it shapes up, but god knows there are worse problems. Even in my most anxiety-ridden moments, a little voice keeps shouting, “New construction! New construction!” in the back of my mind. This will be the moment we look back on in amazement two years from now. Hopefully, a happy surprise.
By all means, drop by the Theater Wit blog and leave opinions, questions or the like. Have a good month!