Title
Facility Lease with Civil Aviation Training Solutions, Inc. at Phoenix Sky Harbor International Airport (Ordinance S-47022)
Description
Request to authorize the City Manager, or his designee, to enter into a facility lease agreement with Civil Aviation Training Solutions, Inc. (CAE) for property located at 1950 E. Buckeye Road for a term of five years, with one five-year renewal option. Total anticipated revenue over the term, if all options are exercised, will be approximately $4,660,657.
Report
Summary
CAE has requested to lease 48,498 square feet of office, parking and Simulator (SIM) Bay space located at 1950 E. Buckeye Road for the purpose of commercial pilot trainings. CAE currently subleases this space from American Airlines (AA) who currently leases the property under a Ground Lease with the Aviation Department (AVN). The AA Ground Lease will terminate effective Feb. 4, 2021 and AA has expressed they will not renew this lease.
Contract Term
The term will be five years, with one five-year renewal option to be exercised at the sole discretion of the Aviation Director.
Financial Impact
Rent for the first year will be $932,131 ($18.70-per-square-foot), plus applicable tax, adjusted annually by the Consumer Price Index (CPI) using the Phoenix-Mesa-Scottsdale index. Total anticipated revenue over the term, if all options are exercised, will be approximately $4,660,657.
Concurrence/Previous Council Action
- This item was recommended for approval by the Phoenix Aviation Advisory Board on Sept. 17, 2020, by a vote of 8-0.
- This item was recommended for approval by the Transportation, Infrastructure and Innovation Subcommittee on Oct. 7, 2020 by a vote of 3-0.
Location
1950 East Buckeye Road
Council District: 8
Department
Responsible Department
This item is submitted by Deputy City Manager Mario Paniagua and the Aviation Department.