10-28-92 Council Minutes - Laserfiche WebLink

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MINUTES CITY COUNCIL OCTOBER 28, 1992 charitable gambling. The first is the difficulty that charities are having in negotiating fair market rental leases. The second is that the City ordinance allows only one bingo hall in the City, therefore limiting market competition on rental rates for bingo hall space. The intent of the committee study was not to judge the current bingo hall landlord. The Administrator noted that the landlord is in compliance with State Statutes for allowable rents. The direction that the committee took was to look at market rents for industrial and office space in the City. The Administrator reported that in studying market rents, it became apparent that the range of rents varied dramatically from $5 to $18 per square foot with some rental rates including items like utilities and maintenance costs and others not. The Administrator reported that comparing these rates to the bingo hall in Little Canada becomes difficult. The Administrator noted the amount of space and parking area that are necessary for a bingo hall operation. Most other properties within the City cannot compete since they would have trouble providing the amenities necessary to support a bingo operation. Therefore, the committee also looked at three other bingo hall operations in the Metro area. Also, the landlord at the Little Canada Bingo Hall provided rental information for several bingo hall operations. The City Administrator reported that he took the information provided by Mover's Warehouse, the Little Canada Bingo Hall owner, and did an analysis of that information on an average and median basis. Average amount of square footage rented for bingo hall operations is just under 9,000 square feet, with the median at 7,432 square feet. Rents for binqo hall operations are higher on a per square foot basis than other markets because of the unique situation. The Little Canada Bingo Hall is shown at 15,000 square feet with a gross rent of $400 per session. This is the second largest bingo hall in terms of square footage, with the second lowest rent based on square footage. However, combine those factors, and the rent becomes the second highest. Nine out of eleven of the bingo halls shown have square footage under 12,000. The significance of that is that current State Statutes allow for maximum rents of $300 per session for 12,000 square feet or less, and $400 per session for amounts over 12,000 square feet. The City Administrator continued an explanation of the staff's rent analysis based on average and median figures and the 830 sessions operated at the Little Canada Bingo Hall. The Administrator noted that on the average Page 8