Title
Authorization to Execute a Ground Lease Agreement for the Cholla Library (Ordinance S-51529) - District 1
Description
Request to authorize the City Manager or his designee, to execute a 50-year ground lease agreement for the Cholla Library located at 10050 N. Metro Parkway E. Further request to authorize the City Controller to disburse all funds related to this item.
Additionally, request the City Council to grant an exception pursuant to Phoenix City Code § 42-20 to authorize inclusion in the documents pertaining to this transaction of indemnification and assumption of liability provisions that otherwise would be prohibited by Phoenix City Code § 42-18 as tenancy agreements include such provisions.
Report
Summary
The City currently leases a 30,000 square foot site for Cholla Library under ground lease Agreement 15166 which expires December 31, 2024. The Library Department wishes to continue occupancy under a ground lease beginning January 1, 2025, for a 50-year term to assure continued library service in this area. Rent for a new ground lease beginning January 1, 2025, will be $97,000 per year, plus applicable taxes, and is within market rents as determined by the Real Estate Division. Rent will increase ten percent every five years. The City is responsible for real estate taxes assessed by Maricopa County, and all operating and maintenance expenses related to the site and improvements.
Contract Term
The term of the ground lease is 50 years, beginning January 1, 2025.
Financial Impact
Rent beginning January 1, 2025, will be $97,000 per year, plus applicable taxes.
Concurrence/Previous Council Action
Lease Agreement 15166, authorized by Ordinance S-7974, adopted November 12, 1974.
Location
10050 N. Metro Parkway E.
Council District 1
Department
Responsible Department
This item is submitted by Deputy City Manager Inger Erickson and the Library and Finance departments.