You are most likely familiar with The Strand building in the heart of the Downtown section of Lakewood.
There is a theater / gallery room as well as additional bar / banquet hall on the ground floor, and residential apartments upstairs.
It is a historic, 100 year old building, built in a time when Lakewood was a popular playground for the rich and famous, and it aimed to encourage Broadway producers to utilize it as a tryout theater before moving their shows to Broadway.
The building is owned by Lakewood Township. It used to be maintained by the Lakewood Development Corporation, one of the arms of the Township. A couple of years ago it was transferred over to the Lakewood Industrial Commission, another arm of the Township which also oversees the Lakewood Airport and promotes commercial growth in the industrial parks.
20 years ago, on July 1, 2002, the Lakewood Development Corporation signed an amazing, 20 year-long lease with Strand Ventures, Inc. for usage of the first floor Strand Theater and banquet hall.
Per the terms of this lease, Strand Ventures keeps the revenue from renting out the theater and banquet hall, as well as from selling concessions at all theater events, and is responsible to maintain the day-to-day general upkeep and cleanliness of the theater. They are also supposed to pay for the utilities they use. The owner gets charged for these utilities and the tenant is required to repay for the utilities when the owner demands repayment.
The owner is responsible for snow and removal, and financing and construction of capital improvements to the preservation of the historic building.
Can you guess how much is the annual lease that the tenant pays to the owner?
A grand total of $1. Yup.
Isn't this an absolutely amazing deal?
This 20 year-long lease will be up this week.
when asked if the Industrial Commission who is the new owner of the building will renew this lease under new terms, Steve Reinman, the Director of Economic Development and the Industrial Commission responded that "the lease renewal process is not completed as [of] yet. The current lessee is continuing on a month to month basis while that works out."
The members of the Lakewood Development Corporation and Industrial Commission are not elected, rather they are appointed by the Township Committee. Their tasks primarily include boosting the economic growth in this town - leasing the Strand for an annual amount of $1 while Strand Ventures keeps the rental and concession revenue just doesn't like a good deal for the taxpayers of Lakewood Township.
As this lease is now up, we are waiting to see if the Industrial Commission will restructure the deal.
On another note, the finances of the residential apartments also deserve some scrutiny.
When the Industrial Commission took over maintenance of the building, they expended for several capital improvements including replacement of a 50 year old boiler system and the HVAC system. A lot of the costs were covered by various grants and a lot of the costs were funded by the Industrial Commission. It is understandable that while paying for these projects, the Industrial Commission's monthly bill list was higher than normal.
However, according to the Industrial Commission's recent monthly bills, they pay over $9,300 in monthly property maintenance and utilities for the Strand building, and they collect under $7,500 in monthly rent from the residential tenants.
Some of these bills appear to be for utilities for the Strand. Per the lease, Strand Ventures is supposed to repay the LIC for their utilities usage after the LIC demands payment for same. From reviewing the annual statement of accounts it appears that Strand Ventures has not repaid any utility bills this year.
As it stands, the taxpayer and land-sale funded LIC expends more - on regular monthly bills - on the Strand building than it collects in revenue.
Numerous questions to the LIC about this financial situation have gone unanswered.
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