CLIENT CASE STUDIES
California Center for the Arts, Escondido
Opened in 1994, California Center for the Arts, Escondido is a community arts facility on a 12-acre campus that includes two performance spaces, a visual arts museum, a conference center, and dance and art studios. A few years after its opening, the Center was experiencing financial problems. The City of Escondido invited WolfBrown consultants to help stabilize the programming, operations, and finances of the troubled Center. This involved refocusing the organization’s mission, programs, management structure, operations, governance, financial condition, and inter-agency relationships. Shortly after contracting for this work, the consultants uncovered unexpected projected deficits, leading to temporary control of the facility by the City. Under these new circumstances, the consultants also assisted with the Center’s immediate operational challenges and developed an emergency plan to stabilize finances. In addition to providing hands-on management assistance, the consultants led an extensive planning and assessment process. The final product of this work was a three-year business plan that included recommendations in the areas of mission and goals, performing arts programs, museum operations and programs, education, conference center operations, organizational structure and governance, fund raising, marketing, and financial management. The plan also included a three-year operating budget. Results of the WolfBrown work were dramatic. In the year immediately preceding the consultancy, the Center ran a $1.4 million deficit. The next year that deficit was cut to a little over $400,000 and the following year there was a surplus of $300,000. As a consequence, control of operations was turned over to an independent nonprofit organization, and the Center continues under that structure today.
A decade after the center opened, downtown Escondido began to experience significant economic benefits, many of which were directly attributable to California Center for the Arts, as this story in the North County Times reports.
Go to www.artcenter.org
Slowly, arts center sparks a downtown boom
By: BRADLEY J. FIKES - Staff Writer
ESCONDIDO ---- For most of its 10 years in existence, the deficit-plagued California Center for the Arts, Escondido, may have appeared to be a poor investment for the city. But take a look at downtown today, and the picture brightens. Much of the recent optimism and increased business activity downtown can be directly attributed to the center.
And downtown vitality was one of the reasons the city cited for building the $81 million arts center a decade ago.
Every downtown needs a defining theme. City leaders knew that Escondido's downtown started losing its identity ---- small shops on pedestrian-friendly streets ---- in 1984, when North County Fair opened on the city's southern boundary. The giant sucking sound was jobs fleeing downtown and stores shuttering, followed by the quietude of downtown streets that were nearly deserted by early evening.
For years, the arts center's economic benefit to downtown was hard to find. But it's a different story today. Restaurants abound in growing numbers, a new Signature Theatre Centre opened across the street earlier this year, and a $30 million, 122-unit condominium project is planned to replace the former Palomar Lane Bowling Center on North Escondido Boulevard.
The arts center underlies this transformation, say city and business leaders who work in the area. Its facilities, including a 1,500-seat concert hall, 400-seat theater, a museum and conference center, allow the center to host different types of events. It has proven to be a magnet for many other businesses that profit from its proximity.
Sales tax revenue in the downtown business improvement district that includes the center has soared since the center opened in 1994. That year, the district's tax revenue was $381,000, and last year it was $1,077,000.
Not all of that increase can be attributed to the center, cautioned Jo Ann Case, Escondido's economic development manager.
"You won't see the huge impact of a large sales tax producer like Home Depot," Case said.
Instead, the center has spurred a qualitative change in development, bringing in more upscale business such as high-end restaurants and the condominium project.
The units in that project are tentatively expected to sell for at least $400,000, said John Barone, a partner at Mansfield Associates, the Del Mar-based firm that designed the project. It will be constructed by Barratt Urban Development, a division of Barratt American, a Carlsbad-based developer. The arts center's proximity, he said, will be a major selling point for the condos.
R. O'Sullivan's Irish Pub and Steakhouse gets a "noticeable" draw from patrons who attend events at the center a block away, said Brendan Kennedy, operations manager. The restaurant, at 118 E. Grand Ave., opened in the spring. R. O'Sullivan's is talking with the center about putting together a dinner/theater package for a November appearance by The Chieftains, a major Irish band.
A longtime favorite restaurant, 150 Grand, established at that address in 1993, was clearly inspired by the center. Then-owners Cyril and Vicki Lucas said they were excited about the city's vision, and expected to benefit from the crowds who would be attending shows and looking for places to dine nearby.
However, while 150 Grant quickly earned a reputation for fine dining at a reasonable price, those throngs didn't materialize, at least not consistently. And by 1997, the Lucases had lost some of their faith in the center.
"The simple fact is that the city's plan to compensate for the inevitable effects of North County Fair by the construction of the arts center has failed," Cyril Lucas wrote in an Oct. 27, 1997 commentary in the North County Times. "I do not mean that to say that building the center was wrong ---- indeed, I admire the project greatly ---- but anyone can see that it has not proved the dynamo which was supposed to revitalize downtown."
Without some greater stimulus to downtown business, Lucas warned, the whole area could fail.
"The businesses that have been disappointed by the failure of revitalization to date cannot survive on hope forever. If they go to the wall, rapid and radical deterioration will follow because property occupancy problems will become insoluble. The cost in blighted prospects will be exceeded by the nightmare costs of a social disaster."
The downtown, and the center, muddled through. An improving economy helped, and special programs such as a Tuesday farmers' market and the popular summer Cruisin' Grand classic car show on Friday nights gave people more reasons to come downtown.
Today, 150 Grand thrives. There is new ownership: the Lucases sold the restaurant a few months ago to their chef, Carlton Greenawalt, and his wife, Stephanie.
The Greenawalts have a lot more company than did the Lucases when they opened 150 Grand. At last count, there were 52 downtown restaurants and eateries, according to the city. In 1994, according to the Downtown Business Association's annual report, there were just 28 restaurants. Eateries by the city's definition included delis, juice bars, and the like.
Put on the walking shoes
Downtowns such as Escondido's have become fashionable places to live, Barone said. Its attractions include two major employers (City Hall is next to the arts center, and Palomar Medical Center is a short distance to the east), easily walkable downtown streets with restaurants and shops, and the Signature center. The Center for the Arts makes it even more special, he said.
Condominium residents "can walk across the street and see world-class entertainment," Barone said.
"Some of us who have been working in Escondido ---- this is our third project there ---- know what's going on. There is a lot happening in Escondido ... When you talk about an urban core, a nice '50's style pedestrian-oriented downtown, there are painfully few of them to go around, anyway. This is a very different Escondido than even five years ago. Now there are museums, there are shops, there are galleries, there are restaurants. You can drive around, and especially walk around, and get a sense that things are happening in downtown Escondido."
"The ideal for us is basically, if that someone were to drive home to that condominium project, park their car Friday night after they did commute, they wouldn't have to get back into their car until Monday morning," Barone said.