Title
Ground Lease with Western Maricopa Education Center District No. 402 at Phoenix Deer Valley Airport (Ordinance S-46349)
Description
Request to authorize the City Manager, or his designee, to enter into a ground lease (Lease) with Western Maricopa Education Center District No. 402 (West-MEC) to construct and use an automobile parking lot at Phoenix Deer Valley Airport (DVT). The Lease will not contain any option to extend the term of the Lease. The Lease is subject to prior approval by the Federal Aviation Administration.
Report
Summary
West-MEC is a public school district that provides career and technical education to high school students and adults at campuses throughout Maricopa County. West-MEC's Northeast Campus is located near the northwest corner of DVT. The campus has a shortage of parking and West-MEC has asked the City to lease approximately 85,200 square feet of land at DVT for the construction and use of a parking lot. The parking lot will include at least 100 parking spaces for West-MEC employees, students, and visitors. West-MEC will construct the parking lot at an estimated cost of $600,000.
Contract Term
The term of the Lease will be 20 years, which includes a construction period of up to 24 months. Rent will commence after the construction period expires or 24 months after the effective date of the Lease, whichever occurs first.
Financial Impact
Rent will be $15-per-space per month over the term of the Lease. As an example, net rent will be $1,500 per month, or $18,000 per year, if 100 parking spaces are built. Rent will be offset by rent credits to be applied on a dollar-for-dollar basis each month over the term of the Lease. At the end of the term, the City will pay West-MEC the fair market value of the parking lot less the value of all rent credits received by West-MEC. The fair market value of the parking lot will be determined by the City and West-MEC.
Concurrence/Previous Council Action
This item was recommended for approval by the Transportation, Infrastructure and Innovation Subcommittee on Jan. 7, 2020 by a vote of 4-0.
Location
Phoenix Deer Valley Airport, 702 W. Deer Valley Road
Council District: 1
Department
Responsible Department
This item is submitted by Assistant City Manager Deanna Jonovich and the Aviation Department.