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Garfield Traub Development and its partner Szostak Design are leading the development of the new $44.4 million Durham Performing Arts Center, a theater of approximately 2,800 seats in downtown Durham adjacent to the Durham Bulls Athletic Park and the American Tobacco Redevelopment. The facility will accommodate a wide range of arts and entertainment programs with a high level of architectural quality, functionality and flexibility. The theater's programming will include Broadway shows, family shows, concerts, youth theater, holiday shows, and arts and outreach programs. The American Dance Festival (ADF) will also use the facility as its new home for major performances during their seven-week summer season. Our team was instrumental in the selection of and negotiation with the operator, a partnership between Nederlander Organization and Professional Facilities Management, who will guarantee a minimum annual number of events, assume the risk of operating deficits and split annual operating profits with the City.
The creative funding plan for the facility includes $33.8 million in net proceeds from Certificates of Participation (COPs) issued under an installment purchase financing agreement. Annual revenue sources for COPs installment payments include an increment of Hotel Occupancy Tax (HOT) receipts designated for debt service, naming rights income or backstop pledges in lieu thereof by the development team and the City, special event parking revenue, a contribution from the City’s Downtown Revitalization Fund, and income from a portion of the Facility Fee charged on each paid ticket. Additional sources of funds include contributions from Duke University, HOT receipts already collected for pre-construction costs, an Operator equity contribution, proceeds from the sale of adjacent City-owned land, and construction fund interest earnings. Construction commenced in December 2006. Building completion and dedication will occur in Fall 2008.
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