Title
Final Passage of Ordinance Approving a Lease and Authorizing the City Manager to Execute Documents Necessary to Implement the Terms of a 10 Year Lease with One Five-Year Option to Renew and an Option to Purchase with St. George Spirits, Inc., a California Corporation, for Building 21 Located at 2601 Monarch Street at Alameda Point. [Requires Four Affirmative Votes] (Base Reuse 819099)
Body
CITY OF ALAMEDA ORDINANCE NO. ______
New Series
APPROVING A LEASE AND AUTHORIZING THE CITY MANAGER TO EXECUTE DOCUMENTS NECESSARY TO IMPLEMENT THE TERMS OF A 10 YEAR LEASE WITH ONE FIVE-YEAR OPTION TO RENEW AND AN OPTION TO PURCHASE WITH ST. GEORGE SPIRITS, INC., A CALIFORNIA CORPORATION, FOR BUILDING 21 LOCATED AT 2601 MONARCH STREET AT ALAMEDA POINT
WHEREAS, St. George Spirits, Inc. is an artisanal distillery company and currently occupies Building 21 located at Alameda Point; and
WHEREAS, St. George Spirits, Inc. entered into the original lease agreement for Building 21 in 2004 with the City of Alameda; and
WHEREAS, St. George Spirits, Inc. is currently in their second amendment to that original lease agreement; and
WHEREAS, the new lease agreement with St. George Spirits, Inc. will replace the original lease agreement; and
WHEREAS, Building 21 consists of approximately 65,000 square feet of rentable square feet; and
WHEREAS, St. George Spirits, Inc. will occupy Building 21 and have the right, on an exclusive basis, to have its employees and visitors park in the adjacent paved areas; and
WHEREAS, the Premises will be used for the production, storage and distribution of alcoholic beverages and complementary products, retail sales of spirits and related merchandise and complementary products, special events and related activities, and a restaurant and offices; and
WHEREAS, the monthly base rent over the ten years of the lease is $35,100 for year one, $36,153 for year two, $37,237.59 for year three, $38,354.72 for year four, $39,505.36 for year five, $40,690.52 for year six, $41,911.24 for year seven $43,168.57 for year eight, $44, 463.63 for year nine, and $45,797.54 for year ten; and
WHEREAS, if the five-year extension option to renew is exercised, the monthly base rent will start at $47,171.47 for year one and will increase 3% at the beginning of each year of the extension option renewal term; and
WHEREAS, St. George Spirits, Inc. has an option to purchase Building 21 once the City provides a Notice of Completion of Subdivision Condition for a price of $8 million, or no less than $7.9 million if a restaurant has been substantially constructed and is open to the public; and
WHEREAS, St. George Spirits, Inc. will be required to provide a security deposit in the amount of $16,250 and the lease contains the standard insurance, indemnity, assignment and termination clauses the ARRA required in its leases and compliant with the Lease in Furtherance of Conveyance (LIFOC).
NOW THEREFORE, BE IT ORDAINED by the City Council of the City of Alameda that by four affirmative votes that:
Section 1. The City Manager of the City of Alameda or his designee is hereby authorized to negotiate, execute, for and on behalf of the City of Alameda, a lease with St. George Spirits, Inc., a California corporation, for Building 21 at Alameda Point for ten years with one five-year option to renew, subject to such technical or clarifying revisions as are reasonably determined necessary by the City Manager and approved by the City Attorney, and the City Clerk is hereby authorized and directed to attest to the same.
Section 2. If any section, subsection, sentence, clause or phrase of this ordinance if, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this ordinance. The City Council of the City of Alameda hereby declares that it would have passed this ordinance, and each section, subsections, clause, or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses and phrases are declared to be invalid and unconstitutional.
Section 3. This ordinance shall be in full force and effect from and after the expiration of thirty (30) days from the date of its final passage.
_____________________________
Presiding Officer of the City Council
Attest:
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Lara Weisiger, City Clerk
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I, the undersigned, hereby certify that the foregoing resolution was duly and regularly adopted and passed by the Council of the City of Alameda in a regular meeting assembled on the 1st day of November, 2016, by the following vote to wit:
AYES:
NOES:
ABSENT: ABSENTIONS:
IN WITNESS, WHEREOF, I have hereunto set my hand and affixed the official seal of said City this 2nd day of November, 2016.
Lara Weisiger, City Clerk
City of Alameda
APPROVED AS TO FORM:
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Farimah Brown
Senior Assistant City Attorney