By ERIC A. HOWALD
Of the Keizertimes
A planned movie theater for Keizer Station isn’t happening.
On Wednesday, June 27, Chuck Nakvasil, the owner of Keizer Cinema LLC, terminated a ground lease for property near the intersection of Chemawa Road Northeast and Keizer Station Boulevard effectively ending the bid to put a theater in on city-owned property.
Nakvasil cited “substantially higher” bids for construction of the nine-screen complex as the reason for pulling out of the lease. The termination is permitted under the terms of a lease agreement with the city that was contingent on successful financing of the project. Nakvasil had to have a signed lease to apply for financing and confirmed bids to finalize the financing of the project.
“We appreciated the opportunity to work with Mr. Nakvasil and his team and, though disappointed, certainly understand the business decision he was forced to make,” said City Manager Christopher Eppley.
The termination of the ground lease ends a process that began in 2016 when a broker approached the city with a potential deal to lease the land and place a theater on the site. During the past two years, city staff and committees adjusted master plans and granted design variances to allow a theater to be erected on the property.
The ground lease was signed in January 2018. At the time, city officials and the project designer expected the theater to break ground in March with an expected opening in time for the major movie push around the holiday season later this year.
In recent months, access roads to the property and a cut-in for a new driveway were constructed as a shared expense between the city, Nakvasil and the owners of the adjacent property.
Under the terms of the lease, Keizer would have collected about $144,000 in rent each year. For the first 20 years, the broker would get a 20 percent share of those revenues. However, the estimated $120,000 annual income would have gone a long way to offsetting payments the city has had to make into the Public Employees Retirement System (PERS).
Keizertimes contacted Nakvasil’s lawyer for more information about the gap between the expected construction costs and the actual bids, but had not received a response at press time.
The Keizer Station project was originally sold to the city with promise of a theater, but it has yet to materialize.