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According to a letter of intent accepted by the city Monday, Oct. 17, a new theater would substantially resemble the Canby Cinema, also owned by Chuck Nakvasil. (Google Street View)

According to a letter of intent accepted by the city Monday, Oct. 17, a new theater would substantially resemble the Canby Cinema, also owned by Chuck Nakvasil. (Google Street View)

By ERIC A. HOWALD
Of the Keizertimes

Keizer may get its first movie theater in years as the result of actions by the Keizer City Council Monday, Oct. 17.

City manager Chris Eppley stressed that the action may lead to a theater, but the acceptance of a letter of intent to site Cinemagic Keizer roughly across the street from the Cherriots Tranfer Center on Keizer Station Boulevard is a landmark in more ways than one.

If everything moves ahead as planned, owner Chuck Nakvasil will construct a medium-sized, first-run theater with beer, wine, liquor and food sales.

A lease on city-owned land at Keizer Station, across from the Cherriots Transfer Center, may yield a new movie theater. (KEIZERTIMES/Andrew Jackson)

A lease on city-owned land at Keizer Station, across from the Cherriots Transfer Center, may yield a new movie theater. (KEIZERTIMES/Andrew Jackson)

“It would be more along the lines of a Cinebarre, fork-and-film, than a large multiplex,” Eppley said. “But there are a lot of letters of intent signed that end up in development, and a lot don’t. We have a lot of steps including land use actions and revisions of the master plan to take before breaking ground.”

Attempts to reach Nakvasil for comment were unsuccessful.

Nakvasil owns six other theaters in Oregon and Washington, but the Keizer theater appears to be the first further south than Canby.

The key to the deal would be a lease on city-owned property where the theater, its parking lot and another small 3,000 square foot pad would be constructed. It’s a first-of-its-kind venture for the city, but one Eppley has championed for several years.

“Given that there are many revenue streams the city has no control over, this is one where we can set the terms and it might be a model for other city-owned properties in the future,” Eppley said.

Keizer still owns a few properties in the Keizer Station area and others elsewhere in the city limits.

In the past, Keizer city councilors have declined to retain ownership of property, but selling parcels off gives the city revenues a one-time shot in the arm while leases create a continuing source of revenue.

Eppley said the city maintains complete control over the type of tenants allowed on such property, which means the city won’t end up in lease agreements with businesses offering marijuana sales. Doing so would put the city in the legally tenuous position of reaping profit from the sales of a federally controlled substance.

The terms of the proposed lease would generate an additional $138,000 annually for the city, about $1.18 per square foot for the 117,250 square foot ground area.

The rent will increase 2 percent annually with a “look back” every 10 years to adjust up or down depending on fluctuations in the consumer price index. The first lease term would last 50 years with nine five-year options to renew and one four-year option, a total of 99 years if the lessee takes advantage of all of them.

The lessee must also pay all associated costs including, but not limited to insurance, maintenance and property taxes. No liens on the property would be permitted. The city will pay for curb cut entries, driveways and sidewalks. The Salem-Keizer Transit District will be responsible for a signaled intersection.

The city council will also have to hold a public hearing on the matter before any lease is signed.

Jay Fetherston of Portland-based Pate Retail Properties will receive a commission for his role in bringing Nakvasil and the city together.

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