Peekskill, Red House agree on Paramount theater lease
Peekskill officials agreed Friday to a 17-year lease deal with Red House Entertainment to take over operations at the Paramount Center for the Arts, with a Monday vote at City Hall expected to seal the deal.
Elected officials for the city, which owns the theater on Brown Street, had agreed March 11 to enter lease negotiations with Red House, but the terms of the actual lease had not been agreed upon until Friday. To authorize the lease, Peekskill officials are scheduled to hold a special meeting at 6:30 p.m. Monday at City Hall (840 Main St., Peekskill, 914-737-3400, www.cityofpeekskill.com).
"We're looking forward to working with the City of Peekskill . . . as we reopen the Paramount Theater," said Kurt Heitmann, who heads the Red House group, in a statement released Friday afternoon. "We're very pleased that everyone has gathered together to make this agreement happen. It's a great day for this vintage theater to be reopening in Peekskill and the Hudson Valley."
Red House's team includes Heitmann, a senior vice president for CP Communications; Jonathan Close, who works for the International Management Group; Ray Wilson, who has produced for TV, radio and stage; and Abigail Adams, who serves as managing director of the Hudson Valley Shakespeare Festival at Boscobel.
Earlier Friday afternoon, in a memo issued by acting City Manager Brian O. Havranek and posted on Peekskill's official website, Havranek wrote: "The details of the Operating Agreement for the Paramount Theater have been worked out between the City of Peekskill and Red House."
Peekskill spokesman Bob Knight confirmed that the deal was for 17 years, with an option for Red House to renew the contract for an additional 10 years. He added that the city would be covering the cost of utilities for the first six months, and claim 5 percent of the gross income of ticket sale for every show.
Red House anticipates generating $900,000 between October 2013 and October 2014, and $2.2 million in the following 12-month span, according to Knight. That would mean $45,000 in income for the city at the end of the first span, and $110,000 at the end of the second.
Even if Red House doesn't quite meet those projections, the city stands to benefit more than it did from the previous lease agreement. Last year, the Paramount's previous operators paid $1 to the city, and received a $50,000 donation from Peekskill, which also paid for the building's utilities, according to Knight.
With a plan to reopen the Paramount with family programing as early as May, Red House aims to program 80 events in its first year and 200 in its second.
Additional information about the lease agreement is available on the city's website, www.cityofpeekskill.com.
Opening in 1930 as a movie complex, the 960-seat theater known for hosting concerts and family programming has been shuttered since Oct. 4, with its previous operators blaming economic difficulties, a dearth of donations, and increased expenses for its closure.
On Feb. 19, a six-member committee of Peekskill business owners, community members and city officials recommended to the Common Council that Red House take over operations at the Paramount Center for the Arts. The Paramount Phoenix Group and Tarrytown Music Hall also made bids to operate the theater, but the committee unanimously sided with Red House.
Committee member Jason Angell, the president of the Peekskill Business Improvement District, told city officials in February that, among the three Paramount proposal finalists, Red House offered the best combination of vision, operating structure, and financial planning and management experience. "We thought that their vision really tied in local businesses and community partners and would be a boon to local economic growth," he said at the time.
Also serving on the screening committee were Havranek, Mayor Mary F. Foster, City Councilwoman Kathie Talbot, Peekskill resident Mike Morey and Cortlandt Town Board member Rich Becker.
Heitmann, a Peekskill native, has said he envisions the new Paramount as a for-profit music and entertainment venue, with a complementary but independent nonprofit arm dedicated to cultural enrichment and education. Red House provided the lone proposal with a profit-nonprofit hybrid approach; Tarrytown and Phoenix offered solely nonprofit models.
The screening committee lauded Red House for its experience and programming vision, one that would promote not only Friday and Saturday night concerts but also ethnic, music and movie festivals, together with themed weeks that would keep the venue busy most days of the week and keep people coming to downtown Peekskill. The committee also praised Red House's plan to generate ancillary revenue through radio broadcasts and live streaming of concerts, as well as syndication, TV, concessions, merchandising and sponsorship.