CITY COUNCIL ACTION REQUEST
Department(s):
Office of Economic
Development and
Cultural Affairs
CEQA:
Not a Project, File No.
PP17-003,
Agreements/Contracts
(New or Amended)
resulting in no physical
changes to the
environment.
Coordination:
City Attorney’s Office,
City Manager’s Budget
Office, and Planning,
Building and Code
Enforcement
Dept. Approval:
/s/
Nanci Klein
Council District(s):
4 CMO Approval:
9/12/23
SUBJECT: LEASE RENEWAL WITH CONCOURSE BUSINESS CENTER, LLC
RECOMMENDATION:
Adopt a resolution authorizing the City Manager or designee to negotiate and execute a First Amendment to the Standard Form Net Lease Agreement dated August 15, 2018 with Concourse Business Center, LLC to extend the lease term for an additional five years from October 1, 2023 to September 30, 2028 at a total base rental cost of approximately $1,493,354 and applicable triple net expenses, subject to annual budget appropriation, and increase the security deposit to $26,381.93 from the original $22,257.
BASIS FOR RECOMMENDATION:
The existing site has been used since October 1, 2018 and it accommodates 35-40 staff members. The proposed extended lease term is for five years with the base rental costs totaling $281,380 for the first year, $289,718.40 for the second year, $298,409.95 for the third year, $307,362.25 for the fourth year, and $316,583.12 for the fifth year of the term, in addition to applicable triple net expenses that are subject to annual budget appropriation. Staff recommend extending the lease at the proposed rate of $1.57 per square foot with an annual 3% increase as this is in line with market rates.
Commission Recommendation/Input:
No commission recommendation or input is associated with this action.
COST AND FUNDING SOURCE:
The first year’s base rent for this First Amendment totals $281,280 and shall increase by 3% per year for a total base rental cost of $1,493,354 for the five-year term. City shall also be responsible for paying applicable triple net operating expenses, subject to annual budget appropriation. Funding for Fiscal Year 2023-2024 is available in the City-Wide Property Leases appropriation (APPN 2064) and is subject to annual appropriations.
FOR QUESTIONS CONTACT: Kevin Ice, Senior Manager, Real Estate Services at [email protected].
COUNCIL AGENDA: 9/26/23
FILE: 23-1268
ITEM: 2.9