“It is expressly understood that no land, building, space or equipment is leased to the Licensee by Parks.”
– From the Dyckman Marina Cafe License Agreement.
Dyckman Marina and its cafe are public property; they are concessions, two of many granted by the city for the use of its public property. Like any other concession, they are governed by very specific rules. These rules explain how concessions are awarded, where their revenue is directed, how they are registered. In this case, the Dyckman Marina concessions are overseen by the Department of Parks and Recreation and were approved by the Franchise and Concession Review Committee.
The Dyckman Marina and Dyckman Marina Cafe concessions are not leased to outside parties; they are licensed. This is a very important legal difference with respect to control and possession of the property. Generally speaking, “a license does not create any estate or interest in the property to which it relates. It merely conveys a privilege in the use of the property and makes an act lawful which without it would be unlawful.” (Halsbury’s Laws). The contracts to operate the concessions are therefore License Agreements and not Leases. These agreements include very clear language such as:
It is expressly understood that no land, building, space or equipment is leased to the Licensee by Parks, but that during the … Term of this License, Licensee shall have the exclusive use of the Licensed Premises of the purpose herein provided… Licensee has the right to occupy and operate the Licensed Premises only so long as each and every term and condition in this License is strictly and properly complied with and so long as this License is not terminated by Commissioner.”
That is very different than a bar or restaurant owner leasing space in a private building along Dyckman Street, where the business has a leasehold estate over the property and may take on some of the rights of real property during their lease. A licensee owns nothing but their personal equipment — anything affixed “in any way to Licensed Premises” belongs to the licensor (the property owner). A license can also be terminated more easily.
Unfortunately the press has for many years referred to the concession operators as “owners”. This is wrong. They may own their operating company and have may have made made major capital investments to improve the concession, but the only “owner” here with respect to the concession is the City of New York and its agent, the Parks Department. The people operating the concession are not owners but operators. In the case of La Marina that operator is a shell LLC owned by four partners called Manhattan River Group.
Two of the partners of Manhattan River Group pose with DJ Erick Morillo, September 7 2014
As such, the operators can occupy and operate the Dyckman Marina and Dyckman Marina Cafe for fifteen years after they open for business, but as licensees their license can be revoked at any time if there is reason to do so:
Notwithstanding any language contained herein, this License is terminable at will by the Commissioner in his sole and absolute discretion, at any time, however, such termination shall not be arbitrary and capricious….
There is additional language about what causes would make such a termination not arbitrary or capricious, including:
Should Licensee materially breach or fail to comply with any of the provisions of this License or any federal, state or local law, rule, regulation or order affecting the License or the Licensed Premises with regard to all matters, Commissioner shall in writing order Licensee to remedy such breach or comply…
The operator would then have to either comply to fix the contractual breach within 30 days, or they could be terminated. Once terminated, all investment in the property and all fixed equipment reverts to the owner, the Parks Department (i.e. the City).
The Parks Department has told community groups for three years that the concession operators are in compliance. That is plainly not true given the many breaches and failures to comply with the provisions of the License and local laws. Why has the owner of the property not acted to terminate the license or force compliance? The licensor should be acting to protect the city’s property and force the licensee to restore the original uses as intended. Anything else makes a mockery of the city’s concession rules and the contractual agreements.