HomeMy WebLinkAbout1998-10-13; City Council; 14884; Lease Agreement 6351 Yarrow Drive53 B % %
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CITY OF CARLSBAD - AGENDA BILL
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APPROVE LEASE AGREEMENT WITH
MTG . 1 O/l 3/98 PALOMAR 910 ASSOCIATES FOR SUITE C,
6351 YARROW DRIVE FOR PURCHASING DEPT. PW WAREHOUSE
RECOMMENDED ACTION:
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CITY All-Y.
Adopt Resolution No. 98 * .$?Y which authorizes the Mayor to execute the lease
agreement between the City of Carlsbad and Palomar 910 Associates Ltd.
ITEM EXPLANATION:
The Purchasing Department currently leases Suite C at 6351 Yarrow Drive for the City’s
warehouse and record storage requirements. The leased space consists of approximately
5,760 square feet and is required until the Public Works Operations Facility is constructed at
the Safety Center. This project is currently in the planning process but is not scheduled for
construction until the year 2000. The lease originated on October 1, 1989. Facilities
Management staff renegotiated the lease in 1991 at a reduced rate because of the
depressed market conditions at that time. The reduced rate, which resulted in a savings of
$13,140 over the term to the City, was extended for the succeeding term which ended on
September 30, 1998. However, since the market conditions have improved considerably,
the landlord has increased the rental rate from $53 per square foot to $59 per square foot
in 1999, and $61 and $.63 per square foot in 2000 and 2001 respectively. Staff confirms
these rates compare very favorably with other unimproved warehouse space available in
the industrial park.
FISCAL IMPACT:
The cost of the previous lease was $3,050 per month or $36,000 annually. The cost for year
one in the new lease is $3,398 per month or $40,776 annually. The cost for years two and
three is $3,514 and $3,629 per month respectively. Funds are included in the Purchasing
Department Budget for this purpose.
EXHIBITS:
1. Resolution No. 98- 33Y
2. Lease Agreement
1 RESOLUTION NO. 98-334
2 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
3 CARLSBAD, CALIFORNIA, APPROVING AN EXTENSION OF THE
EXISTING LEASE WITH PALOMAR 910 ASSOCIATES, LTD FOR
4 SUITE e LOCATED AT 6351 YARROW DRIVE, CARLSBAD
CALIFORNIA
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WHEREAS, the City of Carlsbad, California has determined the need to provide 6
7 warehouse space for record and non-record storage; and
8 WHEREAS, Facilities Management staff has negotiated with the managing partner of the
9 property and secured a new three-year extension of the lease with an increase in rent from
10 $3,050 to $3,398 per month in year one to $3,514 and $3,629 per month in years two and three
respectively;
NOW, THEREFORE, BE IT RESOLVED, BY THE City Council of the City of Carlsbad as
follows:
I. That the above recitations are true and correct.
2. That the modification to the Lease Agreement between the City of Carlsbad and
Palomar 910 Associates, Ltd attached hereto as Exhibit 2 is hereby approved.
3. That the Mayor is hereby authorized to sign the lease modification on behalf of the
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City.
19 II PASSED, APPROVED AND ADOPTED by the City Council of the City of Carlsbad at its 1
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regular meeting held on the 13th day of October , 1998, by the following vote, to wit:
AYES: Council Members Lewis, Finnila, Nygaard and Kulchin
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NOES: None
ABSENT: Council Member Hall
ATTEST:
ALETHA L. RAUTENKkANZ, City Clerk)
(SEW
EXHIBIT 2
PALOMAR 910 ASSOCIATES, LTD.
1859 Camiaito Brh
P. 0. Box 1064
LaJoUa,CA92@38
Phone: (619) 454-8841 Fax: (619) 454-8842
February 17,1998
City of Carl&ad Community Services
405 Oak Ave.
Carkbad, CA 92008
Re: Proposed lease extension - Suite C, 6351 Yarrow Drive, Carl&ad, CA 92009
Am Mr. Chuck Walden
Facilities Superintendent
Dear Mr. Walden:
Per your request, I am hereby submitting for your approval a proposal to extmd your existing
lease at the above re&renced premises for a three year period, said extension to &m&ate
September 30,200l. Your current lease is dated May 2,1989. (It superceded your original lease
dated July 13,1983.) This 1989 lease has been amended by letter agreements dated September
26,199l and September 28,199X
Your current leax agreement is scheduled to temninate September 30,1998. It provides fix a
monthly industrial gross rental rate of $3,050.00 per month I hold a securi@ deposit of
$3,050.00. The lease also provides that Lessee and Lessor each have the right to terminate the
lease by giving one hundred eighty (180) days prior written notice to the other party.
Your leased &pace is approximately 120’~ 48’ (5,760 sq. it. in area) and has a 22’ clear span
ceiling. You have a 10’ x 20’ double truck door with dock high loading; you also have a concrete
ramp which simplifies bading tirn or to small trucks or vans.
You have leased this space from me for 18 years. I very much wish to continue our business
relationship fbr the foreseeable future. Accordingly, I am of&ring you a proposal whi& I believe
is priced well below the current Carlsbad market for similar properties.
I hereby propose the fbllowing modification to your lease:
a. The term&&ion date shall be extended until September 30,200l.
b. The monthly rental rate for this extension period shall be as fbllows:
October 1,1998 thru September 30,1999 $3,398.00
October 1,1999 thru September 30,200O $3,514.00
October 1,2OOO thru September 30,200l $3,629.00
cTYcRLo7.sAM
Proposed lease mod, City of CarIsbad
February 17,1998
c. All other terms and conditions of the lease s&ill remain unchanged.
If this proposed extension is acceptable to you, you may implement it by returning to me a copy
properly signed by the City of CarIsbad.
This offer is good until March 31,1998, at which time it may be changed or revoked without
hrtk notice. Please advise me iftbis date does not provide you with s&Xc&t time to make
your decision
OMAR 910 ASSOCIATES, LTD., Lessor
Eli PerIman
GeneralPartner
AGREED
CITY OF CARLSBAD. Lessee
cTYcRL437.sAM
October 23,1998
Palomar 910 Associates, Ltd.
P.O. Box 1064
La Jolla, CA 92038
ATTENTION: MR. ELI PERLMAN, GENERAL PARTNER
Enclosed please find a certified copy of the signed lease extension for Suite C, 6351
Yarrow Drive, Carlsbad, California.
Also enclosed for your records is a copy of Carlsbad City Council Resolution No.
98-334 which was adopted by the City Council on October 13, 1998, approving the
lease extension with your company.
If you have any questions regarding the lease or the extension, please call Chuck
Walden, at (760) 434-2992.
I understand there was some concern about receiving the signed extension. Please
accept my apologies for the delay - the Clerk’s Office was hit hard by the flu.
hDv KATHLEEN D. SHOUP
Sr. Office Specialist
1200 Carlsbad Village Drive * Carlsbad. California 92008-1989 - (760) 434-2808 @