Title
WITHDRAWN Introduction of Ordinance Authorizing the City Manager to Execute a Lease with Rhoads Property Holdings, LLC, a California Limited Liability Company, Substantially in the Form of Exhibit 2, for Thirty-Six Months for Buildings 338, 608, and 608A-C, Located at 50 and 51 West Hornet Avenue, at Alameda Point. (Community Development 819009) [Will not be heard on November 2, 2021]
Body
To: Honorable Mayor and Members of the City Council
EXECUTIVE SUMMARY
The requested action would be to approve a lease with Rhoads Property Holdings (Rhoads) for thirty-six (36) months and set monthly rent during the term for Buildings 338, 608, and 608A-C located at 50 & 51 West Hornet Avenue at Alameda Point, including approximately 70,989 square feet of rentable space (Premises).
BACKGROUND
Rhoads, formerly CSI Mini-Storage (CSI), provides containerized self-storage and warehouse rentals at Alameda Point. CSI has occupied the Premises since 2005. In 2015, the City of Alameda (City) executed a new lease with CSI with a three (3) year term. In 2018, a first amendment to the lease was executed, extending the lease term for an additional three (3) years. The first amendment also provided an early termination clause permitting landlord to terminate the lease with one hundred twenty (120) days written notice after the expiration of two years of the term. The proposed lease (Exhibit 2) is with Rhoads, the existing tenant’s new business entity name. The lease provides an additional three (3) years of occupancy, until November 30, 2024, and gives the City, as landlord, the right to terminate the lease with one hundred twenty (120) days prior written notice after twelve (12) months.
While a mini-storage facility is not a desired long-term use of the Premises, and the City plans to develop the Enterprise District as a whole, Rhoads generates significant revenue for the City and the short-term nature of the lease will not interfere with the redevelopment plans that include more job-intensive uses. Additionally, Rhoads as CSI has been a long-term tenant and staff believes this is the most efficient and best use of the property for the next three (3) years.
DISCUSSION
The Premises includes 70,989 square feet of rentable space. Buildings 608, 608A, 608B and 608C at 50 West Hornet Avenue contain 17,789 square feet of rentable space, and Building 338 at 51 West Hornet Avenue contains 53,200 square feet of rentable space.
The proposed rent structure for the additional three (3) years is:
|
Months |
Monthly Rent |
|
1-12 |
$61,266.96 |
|
13-24 |
$63,104.97 |
|
25-36 |
$64,998.12 |
ALTERNATIVES
• Approve the second amendment, as described above, with Rhoads for Buildings 338, 608, and 608A-C, located at 50 and 51 West Hornet Avenue, at Alameda Point.
• Direct staff to renegotiate second amendment terms with Rhoads based on City Council direction.
• Direct staff to seek other prospective tenants by marketing the Premises to other tenants.
FINANCIAL IMPACT
The revenue generated by 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 is consistent with the Alameda Municipal Code.
ENVIRONMENTAL REVIEW
This action is exempt from the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15301(c) (Existing Facilities).
CLIMATE IMPACT
There are no identifiable climate impacts or climate action opportunities associated with the subject of this report.
RECOMMENDATION
Approve an ordinance authorizing the City Manager to execute a lease with Rhoads Property Holdings, LLC, a California Limited Liability Company, substantially in the form of Exhibit 4, for thirty-six months for Buildings 338, 608, and 608A-C, located at 50 and 51 West Hornet Avenue, at Alameda Point. (Community Development 819009)
CITY MANAGER RECOMMENDATION
The City Manager recommends approval of an ordinance authorizing the City Manager to execute a lease with Rhoads Property Holdings, LLC for thirty-six months for Buildings 338, 608 and 608A-C.
Respectfully submitted,
Lisa Maxwell, Community Development Director
By,
Lorie Curtis, Management Analyst
Financial Impact section reviewed,
Annie To, Finance Director
Exhibits:
1. Premises
2. Lease
cc: Eric Levitt, City Manager
Gerry Beaudin, Assistant City Manager