AIRPORT AVENUE ‚Äî Santa Monica Art Studios, which rents a 26,500-square-foot public space next to the Santa Monica Airport at a rate significantly below market value, is being reviewed by City Hall.
The contract, which was signed nearly a decade ago, includes a requirement that the spaces be subleased to artists at an average rate of $1.50 per month per square foot, said City Attorney Marsha Moutrie. This was included to ensure affordability for artists, many of whom struggle to make ends meet in a city with high rents.
The Daily Press has repeatedly reached out to Yossi Govrin, the director of the art studios, seeking information as to how much artists are paying for studio space. Govrin has ignored e-mails and hung up on phone calls, always refusing to release the information.
Following an article in the Daily Press about the studios, city officials are putting together a report about the Santa Monica Art Studio‚Äôs lease. It should be released early next week, City Manager Rod Gould said in an e-mail. All airport leases are being audited in anticipation of their expiration next year, Gould said. City officials are gearing up for 2015 when they believe an agreement with the Federal Aviation Administration to keep SMO open expires.
City officials will examine the affordability of sub-rents at the studios in this audit, Gould said. The sub-rents have never been audited by City Hall, Public Works Director Martin Pastucha told the Daily Press earlier this month.
City Hall passed on an estimated $4 million to 6 million dollars over the past 10 years in providing the studio space at an initial rate of 37 cents per square foot per month. This monthly rate has risen to 43 cents with inflation.
City Hall is currently taking in $9,885 per month from Santa Monica Art Studios.
Richard Abbitt, a managing director at Lee & Associates, a Los Angeles brokerage firm specializing in creative office space, estimated that the rates for a space like the hangar could go for $3 per square foot per month, bringing City Hall‚Äôs potential revenue to $67,800 per month.
In a letter to the Daily Press that did nothing to shed light on the rental rates artists are being charged, Govrin mentioned that office spaces near the airport rent for $1.91 per square foot per month. That‚Äôs four and half times the rates he is currently paying to City Hall.
The lease was negotiated by Jeff Mathieu, who is currently the city manager at Big Bear Lake. Susan McCarthy was city manager of Santa Monica at the time. Neither of them have any recollection of the lease negotiations.