Loan OK'd to Ready Kodak for Cirque du Soleil
Updated 3:03 PM PDT, Thu, Jan 7, 2010
The City Council approved a plan Tuesday to lend the owner of the Hollywood & Highland complex $30 million in federal funds to retrofit the Kodak Theatre so it can house Cirque du Soleil performances for a decade.
The proposal still requires the signature of Mayor Antonio Villaraigosa.
CIM Group, which owns the Hollywood & Highland complex and leases the Kodak Theatre, intends to spend the money to build a rehearsal center and a sub-stage 45 feet below the existing stage.
It hopes to hold the first Cirque du Soleil show there in 2011.
City Council President President Eric Garcetti, whose district includes Hollywood, strongly endorsed the loan of federal funds.
"This is no city money -- this is about middle-class jobs, construction jobs, hospitality jobs and stagehands and theater-related jobs in the long term," he said. "Let's be business friendly, and make this loan."
Local officials estimated that Cirque du Soleil shows at the Kodak Theatre could bring 1.2 million visitors to the city every year, many of them tourists. Cirque du Soleil plans to base the shows on the history of movies.
The $30 million loan will be funded with federal money set aside for economic development purposes under the Department of Housing and Urban Development's Section 108 program.
Garcetti said he was confident the loan will be repaid in full since the show would only need to sell 60 to 65 percent of tickets every night to break even, and Cirque du Soleil shows in Las Vegas routinely sell at least 85 percent of their tickets.
CIM will kick in $20 million on top of the $30 million federal loan, which will be secured with the Hollywood & Highland complex. Cirque du Soleil will invest $50 million into the project.
The federal loan requires that at least one full-time job be created or retained for every $35,000 spent. CIM and its partners have pledged to create 858 jobs, but Garcetti said that number is expected to go up significantly, given the complexity of Cirque du Soleil's circus acts.
Many of the jobs will go to Angelenos, since Cirque du Soleil has promised to use the city's Worksource Centers to look for applicants.
First Published: Aug 4, 2009 6:33 AM PDT
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