MEMPHIS, TN (WMC-TV) - The lease agreement for the Pyramid Arena between the city of Memphis and Bass Pro Shops was released to the public Friday, two days after it was signed.
Mayor A C Wharton, who was accused of stonewalling before the agreement was made public, made no excuses for the delay.
"That simply was not handled right," Wharton said. "We just flat-out blew it on that."
Wednesday, Bass Pro Shops entered into a 20-year lease with the city of Memphis. The lease includes options for seven consecutive renewal periods of five years each.
The agreement is what's known as a 'percentage lease.' Bass Pro Shops will pay rent based on a percentage of their sales - a common arrangement in commercial real estate.
"The better they do, the better we do," Wharton said. "That particular aspect is not that distinct in what you have in many shopping centers."
But even if sales are slow, Bass Pro Shops will owe the city a minimum payment $880,000 during the first year of the lease, and $1 million every year after.
"Anything that benefits Bass Pro benefits the city and the taxpayers," Memphis City Council member Bill Boyd said.
But as the store grows, taxpayers may have to foot the bill to build a parking garage to accommodate it - parking spaces that won't be reserved exclusively for Bass Pro customers. Wharton said the city worked for years getting the best deal possible under the circumstances.
"Is there risk? You bet you there's risk. But I've never known a city that said, 'We're not going to take risks,' that ever prospered," Wharton said.
The city has also agreed to pay for the design of a trolley with a Bass Pro Shops theme. If the company decides to vacate, it will have to pay the city $1 million per year until its initial 20 year lease expires.