Can O Cinema Survive?

North Shore

Susan Askew
Susan Askew

Can O Cinema Survive?:

Fate of theater tied to dilapidated Byron Carlyle

During budget and General Obligation (GO) Bond discussions this summer, Miami Beach Commissioners struggled over what to do with O Cinema, the independent film space run out of the City-owned Byron Carlyle Theater on 71st Street. The problem, the deteriorating condition of the Byron Carlyle building and the strained finances of O Cinema’s operators.
The City has a management agreement with O Cinema that runs through the end of October 2019. Miami Beach Director of Tourism, Culture, and Economic Development, Eva Silverstein, recently told the City’s Finance Committee that the operators requested the City extend the agreement and asked for additional financial support.
“For the record, there has been a situation where they defaulted on this agreement,” Silverstein said. “They were given a six-month cure period and they have put in place remedies to keep many of the things on that list from happening.” An audit in December showed the operators failed to obtain a State license for beer and wine sales, failed to pay City resort taxes and State sales taxes, and failed to satisfy the City’s insurance requirements.
Kareem Tabsch, co-director and co-founder of O Cinema, said the theater is serving far more people than originally anticipated. When the operators entered into the agreement, the expected attendance was 10,000 people annually when, in fact, 27,000 people come each year. He said the theater is operating 7 days a week, 52 weeks a year, “the only cultural institution offering daily programming in North Beach.”
“We’re very proud of our affordable prices and we’re very proud of the programming we bring,” he said. “There have been certainly some challenges… we’re very proud we’ve been able to address many of them and we’re still working on others.”
“One of the things we hear all the time is the community wants to see more. We would love to be able to introduce programming for children, families, and seniors,” Tabsch said. “Currently we receive no operating subsidy from the City. We never have and it’s becoming an arduous process to keep up an old building that has always been kind of undermaintained and underutilized. We feel like we don’t want to be penalized [for] the success but we want a better partnership with the City in order to do more.”
The operators are asking for a two year extension on their agreement with a subsidy for utility costs and a waiver of the minimum base use fee paid to the City. Their budget request is for $150,000 which includes $100,000 in management fees and utilities and $50,000 for maintenance costs.
Tabsch said, “This is not just about resident quality of life, which should of course be the most important component. It’s about continuing keeping North Beach as a cultural hub for the community.”
He addressed the City’s plans for a potential development on the site. “The Byron Carlyle… we are very cognizant that it has a different future ahead of it with the redevelopment of that site and we are supportive of that. It’s a City asset, a City block, and could spur really good ideas which we hope to be a long-term part of, but the fact that we’re activating that space every day bringing in 27,000 people… those are not just 27,000 people who are not just coming to see a movie. Those are 27,000 people who are going to eat in the residents in North Beach, who are supporting local business. It’s not just about arts and culture. It’s about the economic impact and when you talk about the investments the City makes that have a great ROI, I would argue arts and culture’s one of them and I would argue O Cinema North Beach is really kind of leading that.”
Commissioner John Alemán said, “I’m torn on this… because what I don’t know is, is this a great cultural component that’s just a little bit ahead of its time and a little bit ahead of the curve in terms of North Beach redevelopment?” She pointed to the planned redevelopment of the Town Center area around the Byron Carlyle “that absolutely will drive more people, more dollars coming into the area, more restaurants so dinner and a show concept.”
That said, she added, “Right now, if nothing else were going to change, it looks like a nonviable operation, right? From a financial standpoint, it looks nonviable, I think, to anyone who would just sort of look at it. But there’s a larger context of what you’re trying to do and where we are on the path to North Beach revitalization. That’s a question, a question that I don’t know the answer to.”
With regard to the two-year extension, she acknowledged the physical condition of the building. “We need to do something about the building... it’s just not providing the value to the City that that piece of land should and the building is very low and it’s decrepit and it floods all the time and has major, major issues resulting in portions of it having been already condemned.”
“Certainly, for any official renewal, our obligation would be to have you in a building that’s safe to be in,” she said. “Let’s figure out what’s going on with the building. Whether it’s a one-year extension or two-year extension, I don’t want any extension getting in the way of what’s best for the City to determine how to use this site.”
“What I do know is that there’s a lot of love for what you do and it is unique within the community,” she said. “I’m open minded given all that context but in terms of the extension it would need to be something the City could cancel whenever it needed to.”
Tabsch responded the existing agreement has one year kick out clause that protects the City.
“My ultimate preference would be that, ultimately, whatever we do with that building would make a new home for you,” Alemán said, “but that’s not anything I could promise because we need to see what anyone’s willing to do.”
Committee Chair, Ricky Arriola said, “Here is the way I analyze a lot of things. What is the cost of doing nothing? If that building goes dark, what happens? 25,000 plus people a year going [there] don’t go there anymore. If that whole area, that whole block gets further blighted… that’s more additional costs, lowering the quality of our life. Activating this block, we start taking back each block by block. We activate the community. There’s more pedestrians walking around, makes it safer. Pedestrians go to restaurants, helps the restaurant businesses, and it becomes a catalytic partner that helps the North Beach community. Right now, between yourselves and the bandshell, we’ve got two pretty fine cultural anchors going in North Beach,” Arriola told Tabsch and co-founder Vivian Marthell.
“I think this is going to be a step backwards if we don’t move forward with this,” he continued. “Furthermore, I’d encourage you guys to think about going bigger. What else can you do” with more money, he asked. “What would that do for your revenues?”
“The truth is things move so slow around here. That building’s not going to go anywhere for at least a few years,” Arriola said. “What if we spent $500,000 to have some beautiful lighting outside of it. Let’s challenge ourselves to not just deal with the asset the way it looks now, but make a little bit of an effort to do something that could enhance the neighborhood, bring you more customers, have a better experience for the patrons. We tend to do the bare minimum and you end up getting very low dollar return.”
He urged them to continue to work on the “organizational challenges… get those things fixed, get them behind you” and suggested a Board with a City Staff member “to provide a little more oversight.”
“I want you to be successful and be a long-term anchor for North Beach,” he said.
“In just about any organization there are tipping points,” Arriola continued. “You get to a certain size, your chance of success increases exponentially. And what I find with a lot of non-profits is they don’t stretch themselves enough to get to those tipping points. They’re literally hand to mouth every week, every year. It’s paycheck to paycheck. It’s funding grant to funding grant. In my opinion we have to start helping some of our better run cultural organizations get beyond that tipping point so they can be self-sustaining.”
“I think you guys have a little bit further to go to get beyond that tipping point but not much,” he said. “So, think ahead. I asked you for a five-year business plan for that very purpose. What is it going to take for you to really be a premier, premier indie art house/movie house, and then we’ll have that conversation to see if there’s an appetite to help you get there.”
The building, however, has deteriorated further and will be undergoing a new inspection to determine the extent of new concerns with the electrical rooms, according to Property Management Director Adrian Morales. Since 2015 a portion of the building has been condemned by the Fire Marshall and the City Building Department. The most recent concern, he said, is “The electrical rooms that O Cinema uses have signs of flooding which requires us to go in and do an inspection with the Building Department to determine whether it can be used or not and whether there are appropriate measures we can take to correct that deficiency. There are some other issues with the fire alarm system, issues where there’s active leaks and some of the mechanical equipment is not working 100%,” he said.
Commissioner Kristen Rosen Gonzalez said, “The Byron Carlyle is a beloved part of our community and the O Cinema adds a certain cachet to that area and people love it. I would do whatever you can to fix it for right now. I don’t think that there’s a political appetite to rebuild that right now. I know that there’s a movement to kind of get rid of it but I’m not in favor of that. I don’t think the community at-large is and I don’t think we should allow it to deteriorate because it’s something special. The O Cinema, the Byron Carlyle, it’s been around forever, you know. That means something.”
Arriola asked what it would cost “just to bring it up to life safety requirements” but Morales responded he didn’t know the answer yet.
Alemán responded to Rosen Gonzalez. “This isn’t political, don’t worry. We submitted our Byron Carlyle Request for Interest [to develop the site] to the market and nobody was interested. You don’t have to worry that this is something political and nefarious but we need to know. You can’t write blank checks either. So, if we’re going to sign a management agreement then we need to know what it would take from the Building Inspector to make it habitable. You can’t have them in there not knowing that. That is tremendous liability and completely inappropriate.”
Assistant City Manager Kathie Brooks confirmed the Request for Letters of Interest with regard to developing the property received no responses. The feedback, she said, was that because it was a Request for Interest and not a Request for Proposals (RFP), “there was no specific guarantee that you would get, that it would be awarded” which was not appealing to developers. She said the Staff recommended going out with a specific RFP. That request will be considered by the full Commission next month along with the City’s operating budget which includes the Byron Carlyle. (The facility is not included in the list of General Obligation Bond projects.)
As of this writing, O Cinema is no longer in default of its agreement. The inspection to determine the condition of the facility has not yet taken place.

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