The Anaheim City Council could guarantee a revenue stream of at least $750,000 a year from the City National Grove of Anaheim with a new contract being considered Tuesday, Sept. 24.
It would take changing operators of the concert and entertainment venue, which is what city staffers are recommending councilmembers do.
Nederlander-Grove has been booking and putting on the shows and rentals at the venue since the city purchased it in 2001, but the proposed change of contract wouldn’t result in a switch to a completely unknown entity. OC Sports & Entertainment’s affiliate organization Anaheim Arena Management manages the Honda Center for the city, and it will be handling entertainment for the new OCVibe venues being built now around the arena.
OC Sports & Entertainment is offering the city a 75% share of operating profits, with that guaranteed minimum of $750,000 a year. In its proposal, Nederlander is guaranteeing a minimum of $150,000 the first year, growing to $300,000 the third year on a 70% profit-sharing proposal.
From both, a $265,000 parking license fee is required to be paid to the city in the first year, which would increase annually with the consumer price index.
The city received only the two bids when it put out the call in May for interested operators. The current facilities management agreement with Nederlander expires in December.
“We were in a very good, but difficult, position where we have two great proposals,” city spokesperson Mike Lyster said, adding the staff’s decision to recommend the change came down to the compensation proposal.
“Nederland has been a great operator and had a very strong proposal,” he said, emphasizing the Grove weathered the coronavirus pandemic successfully with the company.
The proposed contract would be for three years with an option of adding two additional one-year extensions.
Concessions income for the city since 2003 has ranged from as little as $14,692 in 2021 to $932,472 in 2013. In 2023, the city received $819,667. There have been three years of losses, 2004, 2018 and 2020, with the last being the largest at $240,000 and 2018 the least at $118,874.
On average, the city has received nearly $300,000 a year, and in the 21 years has totaled nearly $6.3 million in revenue on concessions. With parking, which has been more stable, its total revenue from the Grove has been $11.1 million.
“What we expect is there would be a high level of continuity with the folks there,” Lyster said about the people working for Nederlander at the Grove should the council decide to change operators.
He said OC Sports & Entertainment has already made initial outreach to the full-time staff and contractors — Nederlander is aware — because there wouldn’t be a lot of turnaround time and having them on board would be beneficial. The Grove has about 10 full-time staff, he said, and uses contractors for its food and beverage.
“There is a high likelihood,” he said, “we would see some consistency in employment.”
The City Council meets at 5 p.m. on Tuesday in the Council Chambers at City Hall.
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