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SHOULD LAKEWOOD TOWNSHIP INCREASE THE STRAND'S RENT MORE THAN $1 PER YEAR?

As first reported here on FAA News, the Lakewood Industrial Commission currently leases out The Strand, which includes a theater room as well as additional banquet hall with a bar on the ground floor, for $1 per year.


The previous 20-year lease is now up for renewal. Amazingly, the Lakewood Industrial Commission is doing everything they can to ensure that no one gets the lease for even $1 more per year!


For starters, you are most likely familiar with The Strand building in the heart of the Downtown section of Lakewood on Clifton Avenue and 4th Street.


There is a theater room as well as an additional banquet hall with a bar 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.


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. (Aren't they just true models of how amazing new landlords are supposed to be?!)


Back to the topic at hand. 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.


(Fun fact: According to public records obtained by FAA News, for the year ending 2020, Strand Ventures included in their list of officers a number of Lakewood Township officials, including members of the Industrial Commission (Yup, they lease the building to themselves!) Robert Kirchner, Tom Calabaro, Greg Stafford-smith, LIC Executive Director Steven Reinman, CDBG Director Ervin Oross, Shade Tree Commission member Craig Theibault, and Mayor Ray Coles. Curiously, for the year ending 2021, of the Township officials, only Steve Reinman and Craig Theibault remained on their list of officers.)


Per the terms of this lease, Strand Ventures kept 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 were also supposed to pay for the utilities they use. The owner gets charged for these utilities and the tenant was supposed to be 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.


The total lease amount was... grand total of $1 per year. Yup!


Isn't this an absolutely amazing deal?


(Fun fact: According to publicly available federal tax filings, in 2019 (Pre-COVID), Strand Ventures earned $407,481 in program services and an additional $83.948 in contributions and grants. After all expenses their annual revenue was $33,252.)



Cool thing is that this 20 year-long lease was up several months ago in July.


At the time, 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."


Since then, the Industrial Commission has been hard at work fleshing out the intricate details of the new lease, and they have now begun the tedious task of soliciting bids for a prospective lessee.


Bearing in mind that The Strand includes its own banquet hall and bar which could be used for small events of up to 80 seated guests, now sounds like a great opportunity for the right person to place an interest in bidding for a fair price, right?


That would make sense, except that Lakewood Township simply loves being on the losing end of every possibly good deal!


Firstly, the 5-year lease solicitation, in the form of a Request for Proposals (RFP), announces very loudly that "only companies with 5 years experience in theater management need apply"! Hmm.... That sure does not sound too inclusive.


Additionally, the RFP specifies that "The Commission is not obligated to award a contract to the respondent who submits the highest price"!


Hm... Why not? Seems that the Industrial Commission is purposely leaving open room to not have to accept any offers higher than the $1 per year that Strand Ventures currently pays!


Finally, just in case the first 2 items don't get their point across, the RFP continues to specify that "The Commission reserves the right to reject any and all proposals... or to abandon the project for any reason... The Commission reserves the right to enter into any contract deemed to be in the best interest of the Commission."


By the way, as noted above, the previous 20 year lease gave freely to Strand Ventures the one way that The Strand does collect some money - from selling concessions at all theater events. Now that this lease is up for renewal, now would be a great opportunity to reverse this deal and allocate those monies to go to the Industrial Commission. However, Lakewood Township is not one to give up a perfect opportunity and therefore, the RFP clearly specifies that the Industrial Commission "will not seek any revenue from the sale of alcohol"!






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 previously reported here and here on FAA News, despite claiming to be a "business community ombudsman on behalf of the township", the Industrial Commission has unfortunately deliberately ignored numerous public comment emails which were sent in to be read at their public meetings, especially when the comments were regarding the apparently sensitive topic of The Strand's finances.


The good news is that, as previously reported here on FAA News, Mayor Ray Coles recently responded to the issues with the Industrial Commission and has urged them to stop ignoring the public comments. Time will tell about this.

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2 comments:

Alte Bachur said...

All of this behind-the-scenes work to ensure that Ray Coles DBA Strand Ventures gets to keep The Strand is because this is Ray's payback.

Back in the day, there were 3 deals in Lakewood to ensure that "everyone" got something:

Bob Singer got the Blue Claws stadium

Aaron Kotler got the Cedarbridge Corporate Campus

and Ray Coles got The Strand

Therefore, "they" will do all "they" need to do to ensure that each party continues to keep their prize.

Lakewood Township Committee is awesome said...

The main stumbling block that they placed to ensure that Ray keeps his prize is that they are requiring potential lessee's to secure a liquor license. Of course, Strand Ventures has already secured their liquor license, because thankfully the Lakewood Township Committee, on June 23, 2022, renewed their annual liquor license! (In case your wondering, no, Mayor Ray did not bother to recuse himself from voting to give himself the liquor licensešŸ¤£).

By the way, Strand Ventures is hooked up with a "Theater Exception Liquor License".

Theater licenses are unique because they are not included in the cap on the number of on-site consumption licenses that may be issued within a municipality. Meaning, if your theater meets the qualifications to hold a Theater License, you do not have to find someone in your municipality willing to sell you an existing liquor license for an exorbitant price. You can simply apply to the Township Committee for a new Theater License. Prior to January 21, 2020, only nonprofit theaters with at least 1,000 seats could obtain a Theater License.

However, under an interesting bill signed by on January 21, 2020, New Jersey Governor Phil Murphy, this law was amended to include all nonprofit theaters that regularly conduct musical or theatrical performances or concerts and have 50 seats or more.