ATTACHMENT 2 ZAB Page 1 of 21 Liquid Entertainment Group, LLC 2367 Shattuck Avenue Applicant Statement February 27, 2016

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1 Page 1 of 21 Liquid Entertainment Group, LLC 2367 Shattuck Avenue Applicant Statement February 27, 2016 Project Description The project site, at 2367 Shattuck Avenue, was formerly a bar and pool hall named Thalassa measuring 10,974 total square feet. Thalassa operated as an ABC licensed bar since 1997 and sales of beer and wine existed at the premises since Hard alcohol and live music have been permitted at the premises since Thalassa vacated the space November 2014 and we seeks to renovate the space to establish an attractive beer garden and community entertainment venue. The property has numerous Use Permits in place including operations until 2 AM, on site distilled liquor sales, food service and live entertainment. However, since there is an expansion in gross square footage of the premises, and increase in occupancy and an expansion of live entertainment, we are now applying for the following: Permits Needed 1. A Use Permit to allow an increase in alcoholic beverage service (as defined by BMC 23E Alcoholic Beverages). 2. A Use Permit modification to allow an increase in occupancy. (BMC 23B ) 3. A Use Permit modification to allow for an expansion of live entertainment. Summary We propose to renovate and revitalize an old, tired tavern bar and pool hall into a new full service restaurant and craft beer garden with a flexible event space for community events and popular activities such as ping pong and live music. Our intent is to create a southern anchor for the Downtown Arts District on Shattuck Avenue and help fulfill the City of Berkeley s goal of making Downtown into the East Bay s regional center for art and culture. We plan to leverage the unique configuration of the premises to maximize the usefulness to the community. The premises consists of two buildings connected at the rear with separate entrances on Shattuck and Durant Avenues. The business will operate under the name Cornerstone. Shattuck Building The Shattuck Avenue building will be the primary focus of the business. The building is approximately 5,000 sq. ft. with a rear patio and will be positioned to become the best craft beer garden and restaurant in Berkeley with 56 taps and reasonably priced food offerings. We have hired Berkeley s own Abueg Morris architects (Comal, Advocate, Flour & Co) to design a unique space with an amazing indoor / outdoor setting and natural finishes. This includes the use of original 100 year old ceiling rafters from the building to construct community tables and seating. Our beer program will focus on local breweries such as Berkeley s Fieldwork, Trumer and The Rare Barrel. Hours of operation for the restaurant and beer garden will be 8am until 2am daily. Please see the attached architect renders of the Shattuck building and patio. Shattuck building proposed occupancy 299.

2 Page 2 of 21 Beer Garden & Restaurant Cornerstone ownership has over twenty years of successful Berkeley restaurant operational history and we have developed a menu that will complement an extensive craft beer offering. The primary focus will be comfort food with items such as homemade chicken pot pie, meatloaf, lasagna and pulled pork. Appetizers will include table olives, bruschetta, California cheese plate and smoked chicken wings. Please see the attached menu. The Cornerstone patio is surrounded by cement walls and only accessible through the main dining room. Craft beer taps will be installed on the patio to allow breweries to have regular Tap Takeovers. A Tap Takeover is when a brewery brings special beers for customers to sample. Brewery staff are also present to introduce the brewery and discuss brewing techniques and styles of beer. Tap Takeovers have become very popular in the recent craft beer boom. Liquor License Cornerstone will operate under a Type 47 Bona Fide Eating Place ABC Liquor License. Food and Beverage will be served by wait staff. All serving staff will be LEAD (License Education on Alcohol and Drugs) trained and/or other ABC approved programs. All customers will need to provide proof of age to alcoholic beverages. We anticipate the majority of live entertainment shows will be 21 and over and ID scanner technology will be used to verify ID s and age. For music shows that are 18 and over, wrist bands and/or hand stamps will be used for patrons who are 21 and over. For patrons who are under 21, we will require their hand to be marked with a visible X using a permanent ink marker. Cornerstone will have a zero tolerance policy for minors in possession of alcohol and they will be ejected if found possessing or attempting to possess alcoholic beverages. Durant Building The Durant building is approximately 5,100 sq ft. with a unique wood arched ceiling and a separate storefront entrance on Durant Avenue. A significant amount of space in the Durant building will be used to support the Shattuck craft beer garden and restaurant. This includes new ADA men s and women s restrooms, dry storage, beer walk in and a trash room. The Durant Avenue building will be designed with an open plan for flexible use and positioned as an activity room to complement the beer garden and restaurant. During the day and evenings, the room will feature popular games including professional caliber ping pong and corn hole bean bag toss. Both ping pong and corn hole have become very popular games at restaurants and bars throughout the country. These games provide valuable flexibility of space as the games can be put away after use. Figure 1: Spin ping pong bar & restaurant and Corn Hole Bean Bag Toss at AA Sports Club & Bar Expansion of Alcohol Beverage Service This application is not a new use for alcohol sales, just an expansion of space by construction of an interior mezzanine. Alcohol sales have existed at this location for over 23 years and we seek to improve the

3 Page 3 of 21 functionality and usability of the space by expanding the storage and service area of the premises. This includes larger areas for walk in cold storage, kitchen space and dry storage. As a result, there is actually a significant reduction in square footage devoted for customer use. However, since our design involves the construction of a mezzanine, which increases the gross square footage area of the premises, we must now apply for a Use Permit for an increase in alcoholic beverage service (as defined by BMC 23E Alcoholic Beverages). Increase in Occupancy The previous configuration of the premises was very inefficient as a result of multiple levels of dining requiring numerous stairs and ramps, including a 50 foot ADA ramp. Additionally, the previous tenant had numerous full sized pool tables which consumed a great deal of space. This was a terrible use of space and modern solutions such as single level dining areas and an ADA lift will be used in our remodel. We will remove pool tables from the premises and not use any fixed table games for flexible use of the space. This results in a significant increase in ground floor space available for customers necessitating an increase in occupancy. We are requesting the following occupancy: Shattuck Building = 299, Durant building = 480. Expansion of Live Entertainment We would like to expand upon the existing live entertainment Use Permit for the premises and promote the Durant building as a community venue space for private events, book readings, comedy shows and live music. Currently there is very limited venue space for community activities in the southern Downtown District. The unique configuration of the premises with two separate and distinct storefronts on two streets allows us to provide convenient useful functionality to the community for a variety of uses. Community Events: Cornerstone will be able to provide well located reasonably priced venue space for rent. Since our Durant building has a separate entrance and is physically divided from the craft beer garden, we will be able to offer a variety of options to the community. One timely example is the Bay Area Book Festival which will be held in early June. Last year the Festival attracted over 50,000 visitors to Berkeley with 100 indoor literary sessions using 12 indoor venues. The Festival organizers have toured our space and they are very interested to host a variety of functions this year at Cornerstone. Meet and Greet sessions with authors as well as poetry readings and other events can be accommodated. As positive contributors to the community we would offer our space free of charge to Book Festival for their events Bay Area Book Festival Author Event at Freight & Salvage

4 Page 4 of 21 Campus Events: There is an enormous amount of interest in our venue space from a variety of groups and departments at UC Berkeley. This includes Haas Business School, UC Berkeley Law School, The School of Optometry, Iranian Student Council, Indus and others. These organizations frequently need of campus venue space to host mixers, socials, and fundraisers. Companies looking to provide product demonstrations or campus recruiting will find our venue space conveniently located and flexible for their needs as Cornerstone will be able to provide a reasonably priced option in a private setting in our Durant building. Additionally several sororities and fraternities have expressed interest about hosting formals in our Durant building space. Currently these organizations do not have an appropriate venue in the east bay for their events and they have to rent venues in San Francisco which requires renting buses. Cornerstone will provide a convenient and appropriate sized venue within walking distance of the campus. Corporate Events and Campus Recruiting Student Fundraisers and Formals Comedy & Live Music We also plan to expand upon the Live Entertainment permit at the premises by providing standup comedy and live musical performances. We have contracted with a local booking company to hire quality entertainment and we expect a broad range of local and national touring artists to perform including Reggae, Blues, R&B, World Music, Rock, Country and Bluegrass. For our comic talent, we plan to work with RoastSF which provides popular comedians to local venues. To ensure quality entertainment, we will not use any third party promoters or rent the venue to any other 3 rd party. We anticipate a mix of seated and standing shows and live entertainment nightly however, hours of entertainment will not exceed 8:00am to 1:00 am. The relaxed ambience and broad range of artists will attract a wide age demographic of music fans. The sound and lighting systems will be start of the art and the new stage will be 24ft wide by 16ft deep and 3.5ft tall. Our proposed occupancy of 480 is complimentary to the upcoming UC Theater on University Avenue (Occupancy 1,440) in that we will be ideally positioned as a feeder venue to the UC Theater. Feeder venues provide the opportunity for upcoming local artists to host live shows in an intimate setting. These venues also enable residents to enjoy quality acts at lower ticket prices. When an artist becomes more popular they can then move their shows to a larger venue like the UC Theater or The Greek Theater. Quality Stand Up Comedy Popular, Intimate Live Music Performances

5 Page 5 of 21 No Third Party Rental This project is driven by a combination of long time Berkeley landlords and business operators. We take very serious the operations of any business we establish and we will never rent any portion of our premises to any 3 rd party or promoter. We fully understand how outside promoters can be reckless and cause additional strain on the Berkeley Police Department. We will personally manage and oversee every aspect of our business including all events to ensure a professional and enjoyable experience for our patrons and the City of Berkeley. Existing Setting The project site is located near the Southeast corner of Shattuck and Durant Avenues lot The lot size is 15,489 square feet, and the existing building has a total square footage of 9,946 gross square feet, and another 1,028 square feet in a private secluded patio at the rear of the building. Shattuck Avenue is a wide, median divided traffic and transit corridor that functions as Downtown Berkeley s main street. The site is in a central area of Downtown Berkeley. The site is adjacent to a two story commercial building to the south, which contains La Note restaurant on the ground floor, and offices on the second level. The project is adjacent to Pegasus Bookstore which is on the corner. Directly west of the site, across Shattuck Avenue, is Staples office supply, Extreme Pizza, Heat Café and Chase bank. The project site is also proximate to a number of other amenities, as well as entertainment and cultural opportunities. North of the project site is Union Bank, Tupper & Reed fine cocktails, and nearby there are multiple movie theaters including the California Theater and Landmark Shattuck Cinema. The site is three and one half blocks south of the Downtown Berkeley BART station, two blocks south of the Hotel Shattuck Plaza, and two blocks west of the southeastern corner of the UC Berkeley campus. The site is also surrounded by a large number of quality restaurants throughout Downtown Berkeley, and is five and one half blocks from the Berkeley Repertory Theatre, the Aurora Theatre Company, the Freight & Salvage Coffeehouse, and The Jazzschool. Parking / Public & Private Transportation We anticipate most of our customers will be within walking distance of our location or use public & private transportation such as BART and LYFT or UBER. The project site is located only 3 blocks from BART and the applicant will proactively engage its customers with transportation options via web site, marketing and flyers. We are working with LYFT to sponsor a designated/preferred driver program offering special discounts to our customers. Considering the premises previous use and capacity as well as the increase in parking garages in the immediate area, the comparative parking impacts should be easily accommodated. It should be noted that Cornerstone management will actively promote local parking garages to its patrons so they may prepare accordingly. FACILITY CAPACITY PRACTICAL CAPACITY (95%)` DISTANCE FROM VENUE Allston Way Garage blocks Brower Center Garage blocks Center Street Garage blocks Sather Gate Garage blocks UC RSF Underground blocks UC Ellsworth blocks UC Manville block UC Extension blocks UC Banway Block UC Underhill Blocks

6 Page 6 of Shattuck located near the corner of Durant 2367 Shattuck surrounded by commercial uses

7 Page 7 of 21 In accordance with Chapter 23E : Special Use Standards for Alcoholic Beverages we offer the following information: 1. The following are a list of all establishments within a one thousand (1,000) foot radius which are in the same category of alcoholic beverage sales or service, as defined by the State department of Alcoholic Beverage Control (ABC): 1. Beta lounge, 2129 Durant Ave. 2. Build Pizzeria, 2286 Shattuck Ave. 3. Giovanni, 2420 Shattuck Ave. 4. Great China, 2190 Bancroft Ave. 5. Venus, 2327 Shattuck Ave. 6. Tupper & Reed, 2271 Shattuck Ave.

8 Page 8 of We hope that the board will approve our application based on the following findings in regards to Public Convenience or Necessity : A. The proposed establishment will promote the City s economic health, contribute to General Plan or Area Plan policies or further District purposes as follows: The proposed project is located in Downtown Berkeley, in the C DMU (Downtown Mixed Use) Corridor District. The purpose of this District is to implement the goals of Berkeley s Downtown Area Plan (DAP), which envision a vibrant, sustainable, and diverse Downtown with housing and employment opportunities, cultural amenities, and entertainment. The proposed project fulfills the purposes of the District, and is a use allowed in the District with a Use Permit. The project would contribute to the economic success of Downtown Berkeley, and would help to support a thriving cultural life, and provide entertainment options that attract employees and residents to Downtown Berkeley. This project supports many aspects of the 2012 Downtown Area Plan. Specifically: Goal ED 1: Serve the needs of the neighborhood and the city. Make Downtown a more attractive regional destination, by building on Downtown s unique blend of cultural, historic, entertainment, art, educational, and community institutions and by promoting successful retail businesses and other attractions with daytime and nighttime populations to support them. Policy ED 1.3: Retail, Restaurants & Cultural Uses. Support existing and encourage highly functional and viable new retail, restaurant, and cultural uses (such as theaters, music, museums, and galleries). a) Reduce discretionary review and streamline permits, to the extent feasible, for retail, restaurant and cultural uses e) Give special attention to Shattuck Avenue from Durant Street to University Avenue, and secondarily to segments of University Avenue, and Addison and Center Streets, between Shattuck and Oxford. Policy ED 1.5: Local Businesses. Encourage the retention and creation of small businesses and locally owned businesses (see Policy ED 9.1). Policy ED 1.6: Larger Retail Spaces. Retain and attract larger retailers to promote downtown as a destination. b) Consider incentives to retain and encourage retail space exceeding 10,000 square feet. Policy ED 1.7: Entertainment & Culture. Strengthen Downtown as a prime regional destination for alternative and mainstream cinema, and live theater and music. Evaluate and enhance the theaterand cinema going experience in subareas where they are concentrated. a) Work to retain and expand cinemas, live theaters, and music venues. b) Work with cinema, theater, and music venues to upgrade to state of the art facilities. d) Promote the arts and cultural events, programs and activities. Policy ED 1.10: Conference Facilities. Seek to retain and expand meeting and conference facilities.

9 Page 9 of 21 B. The economic benefits associated with the establishment could not reasonably be achieved without the proposed increase of alcohol sales; This application is not a new use for alcohol sales, just an expansion of space by construction of an interior mezzanine. Alcohol sales have existed at this location for over 23 years and we seek to improve the functionality and usability of the space by expanding the storage and service area of the premises. Additionally although we are increasing floor space of the premises by constructing a mezzanine, we are actually reducing the customer areas by increasing the Back of House service and storage areas. (See attachment). To summarize: Existing Proposed Ground Floor 9,946 9,910 Patio 1,028 1,028 Mezzanine 1,520 Total Sq Footage 10,974 12,458 Back Of House (BOH) Areas 1,113 4,965 Customer Areas (Total BOH) 9,861 7,493 Reduction in customer areas 2,368 sq ft C. The economic benefits associated with the establishment could not reasonably be achieved without the proposed expansion of live entertainment; Live entertainment has been permitted at this location for over 18 years (see attached Use Permit). We plan to redirect the live entertainment primarily into the Durant building. The Durant building was originally an automotive sales showroom with very high ceilings and an open floor plan. The previous pool hall was limited in the type of use and amount of revenue that it could generate. With escalating rents there are no other viable business opportunities that can use this space in any other format than live entertainment. D. The applicant has not operated a licensed establishment which has been the subject of verified complaints or violations regarding alcohol, public safety or nuisance statues or regulations E. If the proposed establishment is located within one thousand (1,000) feet of any public park or Berkeley Unified School District (BUSD) school, the Board shall take into consideration the effect of the proposed establishment upon such sensitive public uses The establishment, which has served alcohol for over 23 years, is 925 feet from Berkeley High School. The applicant will primarily be an evening and night time business establishment, with busiest times AFTER the high school operating hours. The applicant will take various measures to mitigate the impact of being slightly less than 1,000 feet away from the high school. This will include well trained staff and ID scanners.

10 Page 10 of 21 F. The Police Department has reported that the proposed establishment would not be expected to add to crime in the area. The applicant will work with the Police Department to ensure that the proposed establishment would not add to crime in the area. Additionally, the security and staffing policies management will implement will support increased public safety in the area. A Use Permit modification to allow an increase in occupancy. (BMC 23B ) Our planned reconfiguration of the space will result in more efficient use of space requiring an increase in occupancy. By removing different dining levels and numerous ramps and stairs throughout the premises we are able to create more Back of House areas and customer areas. Additionally, by removing large, fixed pool tables and installing a mezzanine, we have more physical space for employees and customers. We would like to modify our existing Use Permit to allow an increase in occupancy as follows: Shattuck building occupancy: 299 Durant building occupancy: 480 Conclusion We hope the Zoning Board will approve this application as we believe it is modest in nature and an expansion of permitted uses on the property. As stated above, our plans include a reduction in customer areas of over 2,368 sq. ft. Additionally as outlined in the 2012 Downtown Area Plan, we hope our application can be expedited per Policy ED 1.3: Retail, Restaurants & Cultural Uses. Support existing and encourage highly functional and viable new retail, restaurant, and cultural uses (such as theaters, music, museums, and galleries). e) Give special attention to Shattuck Avenue from Durant Street to University Avenue, and secondarily to segments of University Avenue, and Addison and Center Streets, between Shattuck and Oxford.

11 Page 11 of 21 Immanuel Bereket March 31, 2016 Associate Planner City of Berkeley Land Use Planning 2120 Milvia Street Berkeley, CA Dear Manny, RE: Type 47 Liquor License at 2367 Shattuck Avenue Once again, thank you for helping us navigate the zoning requirements for our project. As discussed, we are requesting that the City allow us to comply with the ABC guidelines for alcohol sales instead of the City of Berkeley regulations for alcohol sales. Currently, as you know, the premises is entitled to operate under a Type 48 license with incidental food. We thought about maintaining a Type 48 license, but we felt the value to the community would be greater with a Type 47 license as this would allow minors, including families with children, to enjoy the space. This would include using the space for breakfast, lunch and dinner as well as events such as birthday parties and campus recruiting. Honestly, we did not know about the City regulations for full service restaurants stating alcohol is incidental and sales must not be 33% more than the primary use. We were under the impression the ABC guidelines of limiting alcohol sales to 49% would be the standard for our application. When we made our initial application a year ago, nothing was brought up about this issue. We ask the City to consider our request since, unlike a new application for alcohol sales, the premises has operated as a Type 48 license having 100% alcohol sales in the past. Now we are improving the premises and providing new value to the community by offering a full service restaurant and reducing sales of alcohol from 100% to 49% (under the ABC guidelines). Additionally there are many unknown variables and rising prices such as large increases in the minimum wage that will force us to raise our menu prices. We are not sure how this will impact food and alcohol sales in the future. For these reasons we humbly request the City to allow us to operate under ABC guidelines for alcohol sales of 49% for our premises. Very truly yours, Alex Popov Co founder (415) Shattuck Avenue Berkeley, California 94704

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