Insider was looking through news feeds (we do it, so you don’t have to) when this article caught my eye.
City Council Extends Sunset Spectacular Billboard Contract for Two More Years
This story from WHOville reports that the billboard on Sunset Boulevard, which hasn’t even been built yet, received an extension to its contract by two years to 12 years in an unanimous vote by the West Hollywood City Council. Orange Barrel Media, who will be constructing the digital billboard, requested the two-year extension as a way to make up for potential lost revenue from the Covid driven recession. The Council approved the extension without discussion. Rather than the $1 million per year minimum fee Orange Barrel was initially scheduled to pay, the city will now receive $480,000 each of those first two years. That’s approximately the same amount the city receives each year from the static billboard already in that parking lot.
The 12 years in the article got Insider thinking since just last week Clear Channel Airports announced the Port Authority of New York and New Jersey (PANYNJ) awarded it the largest airport advertising and sponsorship contract in the U.S. The length of that contract, 12 years. That deal contains a two-year transition period to account for the impact of COVID-19 and the traffic recovery at Port Authority facilities. The actual MAG due each year, as well as capex spend, after the two-year transition period will be dependent upon passenger traffic at JFK, EWR, LGA and SWF.
Insider’s Take – Are you currently looking at a new contract or extending an existing contract? Iron sharpens iron and we all learn from each other. Having a contract extended or an easing of terms for the next two years is a terrific idea. The Covid driven recession means we manage our businesses differently. It seems evident that our first economic dip may not be the only challenge we face until a vaccine is approved and distributed.
What are you doing to deal with our changing business environment to better protect your investment. Share your thoughts in the comment box below.
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