Friday, March 18, 2011

URA moves on Starbucks proposal

Restaurateurs oppose plan to put franchise in visitor center

Express Staff Writer

Pete Prekeges, owner of Grumpy’s restaurant, has been one of the loudest voices in opposition to the Ketchum Urban Renewal Agency’s plan to lease space in the visitor center building to Starbucks. He spoke at a URA meeting Wednesday. Photo by David N. Seelig

It wasn't much of a surprise to Pete Prekeges, owner of Grumpy's restaurant, when the Ketchum Urban Renewal Agency unanimously agreed Wednesday to accept Starbucks' proposal for a café in the visitor center building and start negotiating lease terms.

"Why even have a public hearing if their minds were made up at the beginning?" Prekeges said in an interview, referring to a statement that URA Chair and Ketchum Mayor Randy Hall made at the beginning of the meeting.

"The decision to lease the space has been made. We're already passed that," Hall told the approximately 30 disgruntled Ketchum restaurateurs filling City Hall. He said a business offering food and beverages would move into the visitor center.

"You're not doing anything illegal, just unethical," Prekeges told the URA, arguing that public space should not be rented to businesses but community organizations such as nonprofits. That has been the main argument of the restaurateurs and coffee shop owners.

"We'd like to see public buildings used to benefit the whole community, not just some," said Meg Vorm, owner with her husband of Cornerstone Bar & Grill.

The URA and supporters, including Sturtevants owner Rob Santa, argued that having Starbucks in the same building as the visitor center would benefit the whole community.

Greg Randolph, manager of the Sun Valley Chamber of Commerce and of the visitor center that would share the building with Starbucks, said it's the URA's "prerogative" to rent out the building as it sees fit. Nonetheless, he said that having Starbucks there would be "sexy" to the visitor center, potentially increasing traffic "tenfold."

"We need to stop fighting over the little business we have and focus on bringing business here," he said.

Baird Gourlay, URA board member and city councilman, said he doesn't see how Starbucks would compete with other restaurants. People won't eat lunch or dinner there but they could find a restaurant using the adjacent visitor center.

And that wouldn't introduce another coffee shop into Ketchum, argued Larry Helzel, another URA board member and Ketchum city councilman.

"What we have here is a business that wants to move two blocks," Helzel said, adding that even though leasing to a nonprofit would bring in rent money to the URA, it wouldn't drive pedestrian traffic into the building.

Starbucks is currently at the corner of Sun Valley Road and Main Street.


How did the proposed relocation come to be?

"There have been no shenanigans," Hall said at the beginning of Wednesday's meeting in anticipation of accusations that Starbucks received preferential treatment.

On Feb. 6, the URA first advertised 1,200 square feet of empty space on the ground floor there to lease to a food-service establishment, and the it received only one applicant—Starbucks. In that respect, it seems fair.

But the back story is where complaints center.

Lisa Horowitz, Ketchum's director of Community and Economic Development, said that about two and a half years ago, she was approached by a real estate broker who said a client was interested in the space. Horowitz said she contacted the broker in November to reveal that some visitor center space was now available because Mountain Rides had left and the chamber didn't need it. Horowitz said Strabucks then directly contacted her in December, revealing the identity of the mystery client. Horowitz said the URA didn't want to just lease the space to Starbucks, but put out a request for proposals to be "fair."

"Sometimes, you have an opportunity that presents itself," she said in an interview. "Then, you have to do what you can to make it fair."

The Starbucks wouldn't be corporation-owned and operated as it is at the current location, but locally owned and operated, according to Jane Rizzo, a member of Cairde Group, which consists of local investors who would own the new Starbucks location. Rizzo, who would operate the new Starbucks, said Starbucks came to Cairde Group wanting to relocate and turn the new location into a licensed operation. She said that would give them the freedom to use locally produced goods.

URA accepts Starbucks proposal

The Cairde Group's plan entails using 1,900 square feet, 700 more than the URA advertised. That's a sticking point for Curtis Kemp, another URA board member and city councilman, who said he's in favor of a coffee shop but not Starbuck's plan. He said the chamber/visitor center "absolutely" doesn't have enough room.

Chamber/visitor center Manager Randolph said it remains to be seen whether that's true. He said negotiations have started with Cairde Group to ascertain how much space both groups can live with.

After that's decided, the URA's next step will be to decide the rent and the splitting of costs for building upgrades and remodeling of the 40-year-old building.

Trevon Milliard:

Baird Gourlay to step down

Baird Gourlay, a Ketchum city councilman and board member of the Ketchum Urban Renewal Agency, announced Wednesday that he will step down from the board. Gourlay said his resignation from the URA is meant to create more of a separation between it and the city. The two groups are legally separate entities, but the four members of City Council and the mayor make up a majority of the URA board. Two community members, Trish Wilson and Mark Eshman, were added this winter. Gourlay said he would resign when a community member is chosen to replace him, making the URA almost even with four city leaders and three community members. This move comes amid state legislation to create such separation. The House passed four URA reform bills on March 1. The Senate must now do the same to put the reform into place.

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