In Wednesday's Cape Coral City Council meeting a letter of intent was presented to council on the new operations of the Boathouse Tiki Bar & Grill, that includes a lease termination and a deadline to bring forward a new Concessionaire agreement.
What is a Concessionaire Agreement?
A concessionaire agreement is a contract that grants a company the right to operate a business within a government's property or jurisdiction, under specific terms and conditions. In this case, that's the Boathouse on Cape Coral's property.
The City Attorney explained the agreement is better than a lease because it gives the City more oversight with what could happen with the restaurant and the Yacht Club's future.
What are the terms to the Agreement?
30 years
$7,000 a month concession fee
Year 1-10 5% of gross receipts
Year 11-20 6%
Year 21-30 7%
When will an agreement be presented?
That deadline is now August 6th, where council will be presented with the full agreement.
There was a delay in getting it because there was a legal battle going on over the former lease with the Kearns Restaurant Group.
According to the City Attorney there was a disagreement between the City and The Boathouse Tiki Bar & Grill over the rebuild and whether 50 percent of the building was destroyed.
The City argued it was. The lease would need to be terminated.
A fire back in October of 2024 lead to the total loss of the structure in the Yacht Club area.
The disagreement needed to be settled before the Boathouse could be demolished and the city could move forward.
The City Attorney said they are waiting for the final settlement agreement and then they can complete the concessionaire's agreement.
In a letter of intent presented to council the old lease would be terminated and the city and the Boathouse would enter into a Concessionaire Agreement for the construction, maintenance and operation of the waterfront establishment.
The Boathouse would be responsible for all costs associated with the demolition.
The City Attorney said he would allow for 30 days for the demolition but said the Boathouse could be demoed within a matter of days of the Concessionaire agreement being signed.
Councilmember Rachel Kaduk said they will probably have to redline the agreement and it could delay the demolition and she said they are already getting close to the one year mark of the place burning down.
Mayor John Gunter said he was concerned about the brittle structure and wanted it torn down soon. He said he didn't want to go into the middle of hurricane season with a vulnerable structure and what could turn into flying debris.
The term of the Concessionaire Agreement would be 30 years. The City Attorney explained the agreement is better than a lease because it gives the City more oversight with what could happen with the restaurant and the Yacht Club's future.
Council members said they would need to discuss what would happen if the Boathouse sold within that time and also if they could have other establishments there in an exclusivity clause. In the letter of intent, the Boathouse has the right of first refusal.
In the letter of intent, while the new restaurant is being constructed the Boathouse is supposed to operate an interim food and beverage operation and dispense fuel at the existing location.
In that time the Boathouse will pay rent to the City in the amount of $3,500 per month. The City will be entitled to 5% of the gross receipts. When the Boathouse is finished it goes up to $7,000 a month.
The City will contribute $1 million reimbursement toward the complete construction.
In addition to the concession fee, the Boathouse will be paying the following percentage.
Year 1-10 5%
Year 11-20 6%
Year 21-30 7%
The City will continue to own the land and the building. The City says the building will probably be about $5 million dollars to build.
They City will continue to provide a 50/50 cost share for the purchase and installation of the fuel system.
Read the full City Council Agenda here:
https://pub-capecoral.escribemeetings.com/FileStream.ashx?DocumentId=25609
Previous coverage of the Boathouse:
