Title
Authorization to Amend Lease for Water Services Customer Service Division South Pay Station (Ordinance S-44659)
Description
Request to authorize the City Manager, or his designee, to amend Contract 124241 with Mountain Park Retail, LLC to extend the term for a three-year period with one three-year renewal option. Further request authorization for the City Controller to disburse funds related to this item.
Report
Summary
The Water Services Department is in the final year of a 10-year lease for approximately 2,150 square feet of interior office space at 610 E. Baseline Road, Suite C-5, for operation of the Water Customer Services Division South Pay Station. Annual base rent under the current contract is $21.38 per square foot. Water Services seeks to continue its operation at this location while researching options for relocating the pay station.
The extended term will be for a three-year period with one three-year renewal option at the City's discretion. Annual base rent during the three-year extended term is $21.50 per square foot, plus applicable taxes, which is within the range of market rents as determined by the Finance Department's Real Estate Division. Annual base rent will be adjusted to $23.00 per square foot at the beginning of the three-year option period. In addition to base rent, the City is responsible for utilities, repair, and maintenance of common facilities, and operating expenses.
Contract Term
The contract will be amended to extend the term for a three-year period commencing Nov. 1, 2018, with one three-year renewal option.
Financial Impact
Annual base rent during the three-year extended term is $46,225, plus applicable taxes. Annual base rent during the three-year option period will be $49,450, plus applicable taxes. Esitmated total cost for the first year including base rent, utilities, repair and maintenance of common facilities, operating expenses, and applicable taxes will be $64,100. Funds are available in the Water Services Department operating budget.
Concurrence/Previous Council Action
Contract 124241 was authorized by Ordinance S-35013, adopted May 7, 2008.
Location
610 E. Baseline Road, Suite C-5
Council District: 7
Department
Responsible Department
This item is submitted by City Manager Ed Zuercher, Deputy City Manager Karen Peters, and the Water Services and Finance departments.