Administrative
Report
H.9., File # 22-4385 Meeting Date: 7/5/2022
To: MAYOR AND CITY COUNCIL
From: GREG KAPOVICH, WATEFRONT & ECONOMIC DEVELOPMENT DIRECTOR TITLE
ADOPT BY TITLE ONLY RESOLUTION NO. CC-2207-045, A RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF REDONDO BEACH, CALIFORNIA, LEASING CERTAIN PROPERTY
TO MONICA QUINTERO, AN INDIVIDUAL
APPROVE THE LEASE WITH MONICA QUINTERO, AN INDIVIDUAL, FOR A MONTHLY MINIMUM RENT OF $2,716.80 AND A TERM OF JULY 5, 2022 THROUGH JULY 4, 2027
EXECUTIVE SUMMARY
In March 2012, the City purchased the Pier Plaza leasehold and began the process of direct leasing to various tenants. Pier Plaza is comprised of several buildings totaling approximately 75,000 square feet of office and retail uses. The proposed office lease with Monica Quintero, an individual, is for the space at 121 W. Torrance Boulevard, Suite 201. The lease area totals approximately 1,132 square feet.
On May 17, 2022, the City Council approved a similar office lease with Monica Quintero (“Tenant”) at 107 W. Torrance Boulevard, Suite 202, which is approximately 1,025 square feet in size. However, shortly after the lease approval, the Tenant decided that a larger space would be better for business operations. For that reason, the Tenant has selected the proposed 121 W. Torrance Boulevard, Suite 201, which boasts a larger lease area of approximately 1,132 square feet.
The proposed lease between the Tenant and City is for 60 months, with the City retaining the option to terminate the lease with a twelve (12) month prior written notice. Monthly rental revenue to the City’s Harbor Uplands Fund will be $2,716.80, or approximately $2.40 per square foot, with a 3% increase on the anniversary date each year thereafter.
BACKGROUND
The Pier Plaza leasehold is comprised of buildings 103 to 131 West Torrance Boulevard (on the top level of the Pier Parking Structure) and totals approximately 75,000 square feet of space. The property is comprised almost entirely of office uses; with the lone exception being a restaurant of less than 4,000 square feet. The proposed lease with Monica Quintero, an individual, is for the office space at 121 W. Torrance Boulevard, Suite 201 (“Premises”). The lease area totals approximately 1,132 square feet.
Monica Quintero is the founder of the women’s clothing company Pink Poison, which also operates under the name of Demi Loon. The company’s office and manufacturing have been based in Los
H.9., File # 22-4385 Meeting Date: 7/5/2022
under the name of Demi Loon. The company’s office and manufacturing have been based in Los Angeles for approximately 10 years. The company’s designs are known for their unique and edgy gothic clothing line which can be purchased at various retailers or directly through the company’s website.
On May 17, 2022, the City Council approved a lease with Monica Quintero at 107 W. Torrance Blvd., Suite 202, which is approximately 1,025 square feet in size. After much consideration, the Tenant decided that it would be more efficient for the business to operate out of a larger office space and selected 121 W. Torrance Blvd., Suite 201, which is measured at approximately 1,132 square feet.
The proposed lease carries a sixty (60) month term of $2,716.80, or approximately $2.40 per square foot, which is consistent with other similar office leases in the waterfront and the broader market. The lease contains a provision that escalates the rent at 3% per year for the remaining term of the lease.
The City retains the right to terminate the lease with a twelve-month written notice. The lease is personally guaranteed by Monica Quintero and requires a security deposit of $2,716.80 that will be kept on file.
As the Landlord, the City will initially make standard tenant improvements to the space comprised of painting and new carpeting for a total cost not to exceed $4,482.00, or $3.96 per square foot.
COORDINATION
The Waterfront and Economic Development Department collaborated with the City Attorney’s Office on this report. The City Attorney’s Office has approved the lease and resolution documents as to form.
FISCAL IMPACT
Lease revenue from the property will accrue to the City’s Harbor Uplands Fund. The proposed lease will result in a monthly rent of $2,716.80 with an annual total of $32,601.60. Annual increases of 3% over the five-year term will result in revenue to the Uplands Fund of approximately $173,000.
APPROVED BY:
Mike Witzansky, City Manager
ATTACHMENTS
· Resolution No. CC-2207-045
· Lease between the City of Redondo Beach and Monica Quintero, an individual (July 5, 2022) · Lease between the City of Redondo Beach and Monica Quintero, an individual (May 17, 2022)