Title
New Facility Lease Agreement with Swissport USA, Inc. (Ordinance S-52948) - District 8
Description
Request to authorize the City Manager or his designee to enter into a Facility Lease Agreement with Swissport USA, Inc. (Swissport) to lease approximately 9,600 square feet of space in Building B of the West Air Cargo complex at Phoenix Sky Harbor International Airport.
Report
Summary
Swissport currently leases approximately 9,600 square feet of space in Building B of the West Air Cargo complex on a month-to-month basis under Facility License Agreement No. 135958, where it provides cargo handling services to Air France and British Airways.
Swissport recently acquired additional cargo-handling contracts with China Airlines and Starlux Airlines Co. and capital improvements are necessary to meet increased cargo requirements. Swissport requested a lease to support the amortization of those improvements.
Contract Term
The term of the lease term will be three years with two one-year options to extend the term that may be exercised at the sole discretion of the Aviation Director.
Financial Impact
Swissport will pay the West Air Cargo annual rental rate per square foot according to the Airport Rates and Charges program authorized under Phoenix City Code section 4-173(B). The rental rate will be adjusted annually according to the Rates and Charges provision of Article IX, Chapter 4 of the Phoenix City Code. Rent for the first year of the lease will be approximately $172,800 and total revenue over the life of the lease, including all extensions of the term, will be approximately $864,000.
Location
Phoenix Sky Harbor International Airport, 2485 E. Buckeye Road
Council District: 8
Department
Responsible Department
This item is submitted by Deputy City Manager Frank McCune and the Aviation Department.