Received after Agenda Printed
June 27, 2023
Item No. 10
From:
City Clerk"s Office
To:
Mulvey, Jennifer; Rieff, Kim
Subject:
FW: Balboa Bay Resort and Club Lease Extension
Date:
June 26, 2023 2:07:07 PM
Attachments:
Gary2.ona
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From: Gary Sherwin
Sent: Monday, June 26, 2023 2:06:45 PM (UTC-08:00) Pacific Time (US & Canada) To: City Clerk's Office
Cc: Kory Kramer
Subject: Balboa Bay Resort and Club Lease Extension
[EXTERNAL EMAIL] DO NOT CLICK links or attachments unless you recognize the sender and know the content is safe.
Dear Newport Beach City Council:
The Balboa Bay Resort and Club has been an iconic part of our city's visitor experience for 75 years. The resort and club are defining elements of Newport Beach and have hosted numerous meetings and civic functions, as all of you know. As the only waterfront hotel property in the city, it plays a significant role in our ability to bring visitors to our community. It also generates revenue impacting surrounding businesses, such as retail and restaurants, and is vital to our $1 billion annual tourism economy.
On behalf of Visit Newport Beach, we strongly endorse the extension of the property's ground lease. Eagle Four Partners and Pickup Family, the property's owners, have been exceptional stewards of the facility, investing more than $50 million since they purchased it a decade ago, bringing the hotel into a new luxury category that is appealing to meeting planners, visitors as well as residents.
I appreciate your commitment to supporting the visitor industry and furthering our economic prosperity with this lease extension.
With regards,
Gary Sherwin
President/CEO
GARY SHE WIN, DME, APR
PRESIDENT AND CEO
NEWP4RT BEACH & COMPANY
1600 NEWPORT CENTER DR. SUITE 120. NEWPORT BEACH, CA 92660 VISIThl U1+PORTBEACH.CCM � 7800.94.COAST I D. 949119.6100 O f 11' O
From: City Clerk"s Office
To: Mulvey. Jennifer; Rieff. Kim
Subject: FW: written public comment Agenda item 10 (Balboa Bay Club) 6/27/23 Date: June 27, 2023 4:17:48 PM
From: Jesus Hernandez
Sent: Tuesday, June 27, 2023 11:17:41 PM (UTC-08:00) Pacific Time (US & Canada) To: City Clerk's Office ; [email protected]
Subject: written public comment Agenda item 10 (Balboa Bay Club) 6/27/23 YrXTERNAL EMAIL] DO NOT CLICK links or attachments unless you recognize the sender and know the kffe.
Dear City Clerk,
Here are my comments for the permanent record for consent calendar item #10 at the 6/27/23 City Council meeting:
To: Newport Beach City Council
CC: California State Lands Commission
Dear Newport Beach City Council,
The proposed extension to the tidelands lease regarding submerged and filled tidelands located at 1221 West Coast Highway in Newport Beach is entirely inappropriate. Has the city consulted with the California State Lands Commission on this? By extending the 50 year lease when it has only been in place for 13 years the city is essentially making the original lease a 63 year lease. If there is to be any extension, there should be a full analysis of what the appropriate lease rates should be. How do other interested parties get a chance to submit a proposal for providing public service on these tidelands if the lease is extended without an opportunity for others to get involved? This is not a fair practice.
The city staff report (can be found on link below under consent item 10 on agenda link below) suggests that the operators deserve an supported lease extension based on the idea that they have invested money in their business. That was the deal when the lease was put in place 13 years ago. It is nonsensical for the operators to ask the people of California to subsidize (afer- the-fact) the investments the operators chose to make the due course of their business. The unsupported lease extension is essentially a subsidy in the form of a lease extension.that is not supported by current market rates. This 13 year old lease was negotiated during the financial crisis. I think it is safe to assume that market lease rates have changed since then and need to be analyzed prior to any extension. To move forward with a lease extension without further analysis would be a problem.
It is my understanding that many years ago the city told the SLC that the city would evaluate concerns regarding inappropriate improvements and businesses are not consistent with the public trust doctrine at this location when the lease expires. By slamming through this extension, the city is not fulfilling the commitment made to State Lands to reexamine the uses at the location in a reasonable time frame. This extension is not consistent with the public trust doctrine as it pertains to these granted tidelands.
The city staff report indicates certain monies are coming into the city from this tidelands property. Are all those funds going into the Tidelands Trust Fund as required by law? Agenda can be found here (#10 on Consent Calendar): Agenda legistarl.com) According to page 7 of Coastal Development Permit number 5-94-265-Al the state legislator does not approve of the existing use past the year 2044. Therefore, it is inappropriate for the city to extend a lease any further without State Lands Commission and state legislature approval.
Thank you for your consideration.