- 15 -
of the property and the taxpayer's activities with respect to the
property are important factors. See generally Curphey v. Commis-
sioner, 73 T.C. 766 (1980). FGA is substantial, with a capacity
to seat 18,000 patrons. The lease was not a short-term arrange-
ment, as it provided for a 6-year initial term. Further, the
Museum was required under the Second Lease to make arrangements
for security and parking. Prior cases make clear that leasing
activities of this nature constitute a trade or business that are
regularly carried on. See Ohio County & Indep. Agric. Societies,
Delaware County Fair v. Commissioner, T.C. Memo. 1982-210.
Next, the Museum contends that the leasing activity is
substantially related to its exempt purpose, because the Museum
was established to promote live shows and performing arts events.
The Museum asserts that it could have put on these productions
itself. Therefore, the Museum argues that it did not generate
UBTI by merely leasing FGA and having MCA arrange for the
performances.
As discussed supra, an activity is substantially related to
an organization's exempt purpose where the activity has a sub-
stantial causal relationship with the achievement of the exempt
purpose. Sec. 1.513-1(d)(2), Income Tax Regs. In evaluating the
substantial relationship, we examine the manner in which the
Museum conducted its activities in order to determine whether
there was an intent to further its exempt purposes or simply make
a profit. United States v. American College of Physicians, supra
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