Title
Amend Ground Lease with Bimbo Bakeries USA, Inc. at Phoenix Sky Harbor International Airport (Ordinance S-47986)
Description
Request to authorize the City Manager, or his designee, to amend Ground Lease 151988 with Bimbo Bakeries USA, Inc. for real property located at 3115 E. Madison St. (Premises) by adding 100,263 square feet to the Premises and adding two one-year options to extend the term that may be exercised at the sole discretion of the Director of Aviation Services.
Report
Summary
Bimbo Bakeries USA, Inc. (Bimbo Bakeries) operates several locations in the Phoenix Metro area that provide baked goods to its customers. The Premises is located just north of Phoenix Sky Harbor International Airport. The Premises is 65,340 square feet in area and used for parking tractor trailers that relate to Bimbo Bakeries' bakery operation at 738 W. Van Buren St. in Phoenix. Ground Lease 151988 (Lease) expires on April 14, 2023. Bimbo Bakeries is requesting to amend the Lease to add 100,263 square feet to the Premises and add two one-year options to extend the term.
Contract Term
The term will be amended to add two one-year options to extend the term that may be exercised at the sole discretion of the Director of Aviation Services. The current term is three years, which will expire on April 14, 2023. The term may be extended to April 14, 2025 if both options to extend are exercised.
Financial Impact
Annual rent will be approximately $14,381 per month ($1.05 per square foot) and will be adjusted annually based on the Phoenix-Mesa-Scottsdale Consumer Price Index or three percent, whichever is greater. Total anticipated revenue over the term of the Lease will be approximately $461,509.
Concurrence/Previous Council Action
The Phoenix Aviation Advisory Board recommended this item for approval on Aug. 19, 2021, by a vote of 8-0.
Location
Phoenix Sky Harbor International Airport - 3115 E. Madison St.
Council District: 8
Department
Responsible Department
This item is submitted by Deputy City Manager Mario Paniagua and the Aviation Department.