Title
Introduction of Ordinance Approving a Lease Amendment with a Maximum Three-Year Extension of the Lease with CSI Mini-Storage, LLC, a California Limited Liability Company, for Buildings 338, 608, and 608A-C Located at 50 and 51 West Hornet Avenue at Alameda Point. [Requires four affirmative votes] (Base Reuse 819009)
Body
To: Honorable Mayor and Members of the City Council
From: David L. Rudat, Interim City Manager
EXECUTIVE SUMMARY
The requested action would extend the existing lease term with CSI Mini-Storage, located at Alameda Point, for three years.
BACKGROUND
CSI Mini-Storage (CSI) provides containerized self-storage and warehouse rentals at Alameda Point. CSI has occupied the current lease premises since 2005; therefore, this lease agreement is retaining an existing Alameda Point tenant. In 2015, the City executed a new lease with CSI for three years (Exhibit 2). The proposed amendment (Exhibit 3) extends the lease for an additional three years with an early termination clause. After two years, the landlord may terminate the lease amendment by delivery of a written notice. The tenant is required to vacate the premises within one hundred twenty (120) days after receiving the City’s notice.
While a mini-storage facility is not a desired long-term use of the site, and Site B as a whole, CSI Mini-Storage generates significant revenue to the City and the short-term nature of the lease will not interfere with the City’s plans to redevelop this area for more job-intensive uses. Additionally, CSI Mini-Storage has been a long-term tenant and staff believes this is the most efficient and best use of the property for the next three years.
DISCUSSION
The leased premises contain property at both 50 and 51 West Hornet Avenue. Buildings 608, 608A, 608B, and 608C are located at 50 West Hornet Avenue and collectively consist of 17,789 square feet of rentable space. Building 338 is located at 51 West Hornet Avenue and consists of 53,200 square feet of rentable space. Altogether, the premises consists of 70,989 square feet of rentable space. Typically, there are two employees on-site, but as a whole, CSI’s Alameda location supports approximately 10 jobs in maintenance, management, marketing, etc. The following provides a rent schedule for the term of the lease:
|
Months |
Monthly Rent |
|
37-48 |
$52,500 |
|
49-60 |
$54,075 |
|
61-72 |
$55,697 |
FINANCIAL IMPACT
The monies from the amended lease will be deposited into the Base Reuse Fund lease revenue account and are limited to uses permitted under the Economic Development Conveyance Memorandum of Agreement with the United States Navy.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action has no impact on the Municipal Code.
ENVIRONMENTAL REVIEW
This action is exempt from the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15301(c) (Existing Facilities).
RECOMMENDATION
Introduce an ordinance approving an amendment extending the lease term for three years with CSI Mini-Storage, LLC, a California Limited Liability Company, for Buildings 338, 608, and 608A-C located at 50 and 51 West Hornet Avenue at Alameda Point.
Respectfully submitted,
Debbie Potter, Base Reuse and Community Development Director
By,
Nanette Mocanu, Assistant Community Development Director
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibits:
1. Leasehold Area
2. Original Lease
3. Lease Amendment