HomeMy WebLinkAbout1999-11-16; City Council; 15503; Faraday Building Construction and Payments- ‘%I 6 &p /
AB# 15.503 TITLE:
MTG. 11 /I 6/99 UPDATE ON STATUS OF FARADAY BUILDING CITY ATTY. b E@
DEPT. FIN/CD CONSTRUCTION AND APPROVAL OF PAYMENTS CITY MGR. +4-
RECOMMENDED ACTION:
Adopt Resolution No. 99-502approving payment of certain items due under the lease agreement with
Faraday Business Plaza, LLC, for the office building at 1635 Faraday Avenue, Carlsbad, CA.
ITEM EXPLANATION:
In October 1998, Council approved the lease/purchase of a 68,000 square foot building on Faraday
Avenue to improve customer service by providing a single location in which the needs of the
development and business community can be met. The new office space will be used by staff from Community Development, Public Works, Administrative Services, and the Fire Department. In
addition to improved customer service, the consolidation of City offices is also expected to improve
efficiency and interdepartmental communication.
The building has been under construction for the past year. On November 2, the Certificate of Occupancy was issued. All furniture for the building has been ordered and is in the process of being
delivered. The scheduled move-in date is January 20 through January 24, 2000. City offices effected
by the move will be closed during these dates. This includes all of the community development
departments currently operating out of the Las Palmas Avenue facility, the Finance, Human
Resources, Purchasing and Risk Management Departments at City Hall, some of the Water District
staff and all of the Fire Prevention staff. Limited inspection services will be available as well as limited
cashiering services during these days. An extensive public notice program is being developed and
will be rolled out over the next several months.
The term of the lease is ten years with a monthly payment of $74,816.50. The City has an option to
purchase the building between the twelfth and twenty-fourth month of the lease at a price of $9.1
million. Included in the lease price is a tenant improvement allowance of $1,650,000. All
improvement costs in excess of this amount are the responsibility of the City. The lease also requires
certain payments to the developer to pay for changes in the shell building, tenant improvements in
excess of the allowance, and certain other negotiated payments for construction delays.
The lease commences two weeks following the issuance of the Certificate of Occupancy which puts
the commencement date at November 16. Under the lease agreement, all billings for shell and
tenant improvement costs are due on the commencement date or 30 days after submission of the
invoice, whichever is later.
As of October 15, billings for $2,713,325 have been submitted. Staff has reviewed all of the invoices
and concurs with the amounts invoiced. There are still some outstanding invoices which have not yet been submitted. Staff is requesting authorization to pay the $2,713,325 in current invoices and to pay
additional invoices as submitted and reviewed up to an additional amount not to exceed $100,000.
* Page 2 of Agenda Bill # 15 9 503
FISCAL IMPACT
The total appropriations for the project and the estimated costs are shown below:
ITEM
Estimated Costs:
Space planning/Interior design $ Shell, tenant improvement upgrades, systems wiring
Construction delay payment
Space planning delay payment
Phone/computer lines/systems
Moving costs
Contingencies
Sub total . . .
158,000
2,847,409
20,000
33,000
140,000
80,000
400,000 3,678,409
Furnishings/Equipment 1,525,OOO
Lease payments for fiscal year 1999-2000 673,349
Total Estimated Costs $ 5,876,758
Appropriations:
Public Facilities Fees
GCC
Total Appropriations
$ 4,459,900
1,525,OOO
$ 5,984,900
The building is substantially completed. With the approval of the $2,713,325 being requested in this
agenda bill, most of the costs shown above will have been paid or encumbered. Based on these
estimates, there are sufficient funds appropriated to make the payments requested and to complete the
project.
EXHIBITS:
1. Resolution No.gg-507 approving payment of certain items due under the lease agreement with Faraday Business Plaza, LLC, for the office building at 1635 Faraday Avenue, Carlsbad, CA.
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RESOLUTION NO. 99-502
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF CARLSBAD, CALIFORNIA,
APPROVING PAYMENT OF CERTAIN ITEMS
DUE UNDER THE LEASE AGREEMENT WITH
FARADAY BUSINESS PLAZA, LLC FOR THE
OFFICE BUILDING AT 1635 FARADAY
AVENUE, CARLSBAD, CA
WHEREAS, the 1999-00 Capital Improvement Program
(CIP) contains funds for the lease/purchase of a building to provide
additional offices for City staff fi-om the Public Facilities Fees fund; and,
WHEREAS, the purpose of the building is to improve
customer service by providing a single location in which the needs of the
development and business community can be met and to improve internal
communications; and,
WHEREAS, the City Council approved a lease for the
building at 1635 Faraday Avenue, Carlsbad, California, on October 27,
1998; and,
WHEREAS, the lease requires certain payments to the
developer to pay for changes in the shell building, tenant improvements in
excess of the allowance and certain other negotiated payments for
construction delay.
NOW, THEREFORE, BE IT RESOLVED by the City
Council of the City of Carlsbad, California, as follows:
1. That the above recitations are true and correct.
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2. That the payment of $2,713,325 to Faraday Business
Plaza, LLC, as required under the lease agreement dated
October 15, 1998 is hereby approved.
3. That the City Manager is ‘authorized to pay additional
invoices to Faraday Business Plaza, LLC, in payment of
tenant improvement costs as required under the lease
agreement up to a maximum of $100,000.
PASSED, APPROVED, AND ADOPTED at a regular
meeting of the Carlsbad City Council held on the 16th day of
November , 1999 by the following vote, to wit:
AYES: Lewis, Hall, Finnila, Nygaard, Kulchin
NOES: NONE
ABSENT: NoNE
ATTEST:
~HAQ&&JTEI$jRANZ, City Clerk (SEAC) Karen R. Kundtz, Assistant City Clerk