Screen Actors Guild officials have begun questioning whether to go through with a $56 million leasing deal for new Gotham offices favored by the branch exec director.
Questions arose Wednesday at the executive committee meeting of the New York branch, which voted to place the matter on the agenda of this weekend’s national executive panel. Move came after members sought details from New York branch exec director John Sucke about the lease agreement, which calls for the offices to be relocated in July 2002 to a building under construction at 360 Madison Ave. in midtown Manhattan.
Sucke keeping to plan
A guild spokeswoman said Thursday that Sucke plans to continue with the deal despite the committee’s concerns.
The national board agreed to the deal in late 1999, but SAG chief financial officer Gerald Wilson has recommended against going through with it due to the guild’s worsening financial situation ( Daily Variety, June 27). He has pointed out that the new building will cost $2.8 million per year, almost $1 million more annually than the current lease at Viacom headquarters in Times Square at 1515 Broadway.
Sucke has contended that Wilson’s suggestions were “well-intentioned but flawed,” noting that rental rates have increased sharply since the deal was signed. Sucke has also dismissed the idea of relocating to a less costly facility outside midtown.
Dissent taking shape
The New York exec committee questioned Sucke on Wednesday as to why he had not exercised SAG’s option to terminate the lease under a provision that becomes effective if the landlord had not “substantially completed” the concrete superstructure of the building by July 1.
The SAG spokeswoman said Sucke asserted that the foundation has been completed and the Kipp-Stawski Management Group sent him a letter July 10 asserting that the superstructure had been “substantially completed” by June 1.
But that point came under dispute at Wednesday’s meeting, with members asserting that concrete was being poured into the foundation last week.
Sucke was also questioned about details pertaining to the requirement that SAG vacate the Viacom building when its current lease runs out at the end of June. Members, noting that they had been told that the guild was being required to leave because Viacom wanted to take over the space, asserted that leasing agent Jones Langley Lasalle is, in fact, offering leases for the facility.
But the SAG spokeswoman said Thursday that rents at the Viacom building after the lease expiration will rise to an unacceptable level and make it impossible for the guild to remain.
SAG, which has an annual budget of about $50 million, has never disclosed the existence of the lease agreement to the membership at large. The New York office reps 25% of members; Hollywood accounts for 54%, the 23 other branches 21%.