Administrative
Report
H.4., File # 22-4889 Meeting Date: 10/18/2022
To: MAYOR AND CITY COUNCIL
From: GREG KAPOVICH, WATEFRONT & ECONOMIC DEVELOPMENT DIRECTOR TITLE
ADOPT BY TITLE ONLY RESOLUTION NO. CC-2210-085, A RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF REDONDO BEACH, CALIFORNIA, LEASING CERTAIN PROPERTY TO DEVEL, INC.
APPROVE THE LEASE WITH DEVEL, INC. FOR A MONTHLY MINIMUM RENT OF $1,446.50 AND A TERM OF OCTOBER 18, 2022 THROUGH OCTOBER 17, 2023
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 Devel, Inc. (Tenant) is for the space at 119 W. Torrance Boulevard, Suite #3. The lease area totals approximately 526 square feet.
The proposed lease between the Tenant and City is for 12 months. At the end of the term, the lease will automatically change to a month-to-month tenancy. The Tenant will have the option of remaining month-to-month or entering into a new lease. Under the month-to-month tenancy, the Landord (City) has the right to terminate the lease with a 30-day written notice. Monthly rental revenue to the City’s Harbor Uplands Fund will be $1,446.50, or approximately $2.75 per square foot.
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 exception of a restaurant and child care center. The proposed lease with Devel, Inc. is for the office space at 119 W. Torrance Boulevard, Suite #3 (Premises). The lease area totals approximately 526 square feet.
Devel, Inc. is a software, app and marketing firm that is expanding their offices in Southern California.
The proposed lease carries a 12 month term at a rate of $1,446.50 per month, or approximately $2.75 per square foot, which is consistent with other similar office leases in the waterfront and the broader market. At the end of the term, the lease will automatically change to a month-to-month tenancy. The Tenant will have the option of remaining month-to-month or entering into a new lease.
Under the month-to-month tenancy, the Landord has the right to terminate the lease with a 30-day written notice. The lease is personally guaranteed by Michael Goliszek, Principal of Devel, Inc., and requires a security deposit of $1,446.50 that will be kept on file.
As the Landlord, the City will make standard tenant improvements to the space comprised of painting
H.4., File # 22-4889 Meeting Date: 10/18/2022
and the repair or replacement of window blinds and ceiling tiles for a total cost not to exceed $1,000.
COORDINATION
The Waterfront and Economic Development Department collaborated with the City’s leasing agent 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 $1,446.50 with an annual total of $17,358.
APPROVED BY:
Mike Witzansky, City Manager
ATTACHMENTS
· Resolution No. CC-2210-085
· Lease between the City of Redondo Beach and Devel, Inc.