by Liz Daube
Staff Writer
After some questioning from City Council members, the mayor’s office plans to renegotiate another Downtown coffee shop deal.
Council committees have deferred approval of the proposed lease for a coffee shop planning to open in the city-owned Ed Ball building in December. The terms of the five-year lease would give cafe owner Diane Rukab a free first year of rent, along with two parking spaces.
“My retailers are calling me and saying, ‘What’s going on?’” said Council member Suzanne Jenkins, who represents the Downtown area. Jenkins said other Downtown businesses were concerned about the fairness of the deal.
City spokeswoman Kortney Mosley said the mayor’s office has decided to renegotiate the lease and halt similar rent reductions and discounts in the future.
“There will be no more abatements to City contracts,” said Mosley. “We are going to renegotiate the contract with the coffee shop.”
The lease will be amended after further discussions with Rukab, Mosley said. Under the current terms, the 875 square feet of space planned for the cafe would bring the City $13,125 per year after the first rent-free year.
“The reason behind that (abatement) was the space is not a very leasable space,” said Mosley. “It’s kind of small and awkwardly-shaped, so we knew it was going to be a little difficult to get someone in.”
She added that the cost of build-out and repairs for the space – which Rukab planned to pay for – were estimated to cost more than $10,000. Besides the free rent, Mosley said the parking provision might be changed.
“I think when this decision was made, the realization wasn’t made that parking was included in the rent,” she said.
The decision to change the Ed Ball coffee shop lease comes after more than a year of negotiations with Shelby’s Coffee Shoppe, the cafe that will open in the Main Library in a few months. Some City Council members objected to the library cafe’s lease terms, which include up to $260,000 start-up cost reimbursements.
Mosley said the Ed Ball building cafe deal began before the City purchased the building, when Rukab approached property management company Jones Lang LaSalle. The company will continue to manage the property by contract until at least September 2007, Mosley said.
The City plans to renovate the Ed Ball Building and eventually move several City agencies out of the Annex on Bay Street and into the building. Eventually, most City agencies will be located within a short walk of City Hall. The Police and Fire Pension Fund has obtained ownership of the old Haverty’s Building at the corner of Laura and Duval streets. Demolition work is underway in the Haverty’s Building which will also be used for City offices. The City will lease space from the Pension Fund on a lease-to-own basis for several years.