August 1, 2023
HONORABLE MAYOR AND CITY COUNCIL
City of Long Beach
California
RECOMMENDATION:
Authorize the City Manager, or designee, to execute all documents necessary for a Second Amendment to Lease No. 34894 with BLANKSPACES, LLC , for City- owned property located at 309 Pine Avenue, commonly known as the Shaun Lumachi Innovation Center. (District 1)
DISCUSSION
On December 5, 2017, the City Council approved Lease No. 34894 (Lease) with BLANKSPACES, LLC (Lessee) for City-owned property located at 309 Pine Avenue , commonly known as the Shaun Lumachi Innovation Center (Subject Property). The Subject Property required substantial capital improvements to make the facility functional and code compliant, including elevator recommission, bathroom improvements, ADA access upgrades, and interior redesign of the space to support co -working activitie s and entrepreneurial community events. On February 8, 2022, City Council approved a First Amendment to the Lease to compensate the Lessee for documented financial losses, as well as adjust the Rent Commencement Date to July 1, 2023, due to delays from C OVID- 19 related closures and resulting supply chain challenges. The Shaun Lumachi Innovation Center celebrated its grand opening on May 13, 2022.
Due to recent heavy winter storms, t he Subject Property experienced roof damage and resulting leaks which affected the interior of the building. In addition, a leak in the sewage drainage system was discovered requiring significant repair and renovation to the restrooms. The time required to complete the required remediation and repairs from b oth issues have spanned approximately six months causing the Lessee further economic losses due to the disruptions to its customers. Rent, currently due and payable as of July 1, 2023, is $9,400 per month, less any available rent credits to offset Lessees management fee and certain operating costs. The total rents credits cannot exceed $4,600 per month, resulting in a minimum monthly rent of no less than $4,800. The Lessee has requested to extend the Rent Commencement Date approximately six months to Jan uary 1, 2024 to allow the Lessee additional time to recover financially from these delays and realize operations at full capacity. A Second Amendment to the Lease would be required to memorialize this accommodation.
This matter was reviewed by Principal Deputy City Attorney Richard F. Anthony on July 10, 2023 and by Budget Management Officer Nader Kaamoush on July 14, 2023.
Economic Development Department
411 West Ocean Boulevard, 10th Floor Long Beach, CA 90802 (562) 570-6099
C-21
HONORABLE MAYOR AND CITY COUNCIL
August 1, 2023
TIMING CONSIDERATIONS
City Council action is requested on August 1 , 202 3, to facilitate execution of the amendment.
LEVINE ACT
This item is subject to the Levine Act. The Mayor, Councilmembers, and Commissioners who have received a contribution of more than $250 within 12 months prior from a party, participant, or their representatives involved in this proceeding may d o either of the following: (1) disclose the contribution on the record and recuse themselves from this proceeding; OR (2) return the portion of the contribution that exceeds $250 within 30 days from the time the elected official knew or should have known a bout the contribution and participate in the proceeding.
All parties, participants, and their representatives must disclose on the record of this proceeding any contribution of more than $250 made to the Mayor or any Councilmembers within 12 months prior to the date of the proceeding. The Mayor, Councilmembers, and Commissioners are prohibited from accepting, soliciting, or directing a contribution of more than $250 from a party, participant, or their representatives during a proceeding and for 12 months following the date a final decision is rendered.
FISCAL IMPACT
The proposed amendment extends the abatement for an additional 6 months, for a total period of 22 months. This results in lost revenues to the General Fund Group valued at $28,800; $14,400 in Fiscal Year 2023 (FY 23) and $14,400 in FY 24. These revenues were not budgeted due to uncertainty of when the Lessee would be able to occupy the building. Accordingly, there is no budgetary impact associated with this recommendation.
This recommendation has no staffing impact beyond the normal budgeted scope of duties and is consistent with existing City Council priorities. There is no local job impact associated with this recommendation.
SUGGESTED ACTION:
Approve recommendation.
Respectfully submitted,
BO MARTINEZ
DIRECTOR
ECONOMIC DEVELOPMENT
APPROVED:
THOMAS B. MODICA
CITY MANAGER
THE PROMENADE N
HARVEY MILK
PROMENADE PARKPINE AVE
W 3RD ST
CEDAR AVE PACIFIC AVE
E 3RD ST
E 4TH STW 4TH ST
T:\2017_Economic and Property Development\Exhibit to Attachment_CHG141777 5 3
7 2
8 9
1 46
50 0 50 10025
Feet
Attachment A
´
Subject Property:
309 Pine Ave
AIN: 7280-016-906
Council District : 1
COLB Levine Act Statement Page 1 of 2
LEVINE ACT DISCLOSURE STATEMENT
California Government Code Section 84308, commonly referred to as the "Levine Act," prohibits any Long Beach City Councilmember, the Mayor, and Commissioner (“City Officer”) from participating in any action related to a proceeding if they receive any political contributions totaling more than $250 within the previous twelve months, while a proceeding is pending, and for 12 months following the date a final decision in a proceeding concerning a license, permit, entitlement, franchise or, contract (collectively “license, permit, or contract”) has been made, from the person or company awarded the said license or contract. The Levine Act also requires a City Officer that has received such a contribution to disclose the contribution on the record of the proceeding.
City Officers are listed at the following sites:
• The Mayor and Councilmembers - https://www.longbeach.gov/officials/ • Harbor Commissioners - https://polb.com/commission
• Water Commissioners - https://lbwater.org/about-us/current-water-commissioners/ • Planning Commissioners - https://www.longbeach.gov/mayor/action/commissions/ • Parks and Recreation Commissioners - https://www.longbeach.gov/mayor/action/commissions/ • Board of Examiners, Appeals, and Condemnation - https://www.longbeach.gov/mayor/action/commissions/ • Cultural Heritage Commission - https://www.longbeach.gov/mayor/action/commissions/ • Long Beach Community Investment Company - https://www.longbeach.gov/lbds/hn/lbcic/
Proposers are responsible for accessing these links to review the names prior to answering the following questions.
1. Have you or your company, or any agent on behalf of you or your company, made any political contributions of more than $250 to any City Officer in the 12 months preceding the date of the submission of your proposals or the anticipated date of any City Council, Board, or Commission action related to this license, permit, or contract?
YES NO
If yes, please identify the City Officer(s):
COLB Levine Act Statement Page 2 of 2
2. Do you or your company, or any agency on behalf of you or your company, anticipate or plan to make any political contribution of more than $250 to any City Officer in the 12 months following any City Council, Board, or Commission action related to this license, permit, or contract?
YES NO
If yes, please identify the City Officer(s):
Answering yes to either of the two questions above does not preclude the City of Long Beach from awarding a license, permit, or contract to your firm or any taking any subsequent action related to the said license, permit, or contract . It does, however, pr eclude the identified City Officers from participating in any actions related to this license, permit, or contract.
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Date
_____________________________________
Signature of authorized individual
___________________
Type or write name of authorized individual
___________________
Type or write name of company