title
AUTHORIZE THE CITY MANAGER TO EXECUTE A LEASE FOR LINDEN LIBRARY WITH MAGNASCO INVESTMENTS
recommended action
RECOMMENDATION
It is recommended that the City Council adopt a motion authorizing the execution of a three-year lease with Magnasco Investments for the Linden Library facility, with a mutual option for an additional three-year term, and authorize the City Manager to take all appropriate and necessary actions to carry out the purpose and intent of this motion.
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Summary
The City of Stockton manages the Stockton-San Joaquin County Public Library System (“Library”) through an agreement with San Joaquin County. The Library operates library branches throughout Stockton and San Joaquin County, including the Linden Library.
The Linden Library has operated at 19059 E. Main Street (Highway 26), Linden, in a commercial space owned by Magnasco Investments since 2004. The current lease term is approaching expiration, and staff recommends entering into a new lease to allow the Library to continue providing services at the existing location.
The proposed lease provides for an initial three-year term ending August 31, 2029, with a mutual option for an additional three-year term through August 31, 2032. Monthly lease payments will begin at $3,452 and increase annually over the term of the agreement.
DISCUSSION
Background
Linden is an unincorporated community located east of Stockton in San Joaquin County. The community does not have a government building or other permanent location available for a public library. The Linden Library has operated continuously at its current location since 2004 under a series of lease agreements with Magnasco Investments. The facility is centrally located in the Linden community, in a commercial area, with parking available for library patrons and staff.
In 2021, the City Council authorized a three-year lease for the facility with an option for an additional three-year term. The Library has continued operating from this location under that agreement.
Present Situation
The Library desires to continue providing consistent library services to the Linden community at the existing location. Magnasco Investments has agreed to enter into a new lease with the City for continued operation of the Linden Library at 19059 E. Main Street (Highway 26).
The proposed agreement provides for an initial three-year lease term beginning upon execution of the agreement and ending August 31, 2029. The agreement also provides a mutual option for an additional three-year renewal term beginning September 1, 2029, and ending August 31, 2032. To exercise the renewal option, the City must provide written notice requesting renewal on or before May 1, 2029, and Magnasco Investments must agree to the renewal.
Monthly lease payments during the initial term are as follows:
|
Lease Period |
Monthly Payment |
|
Execution through August 31, 2027 |
$3,452 |
|
September 1, 2027 through August 31, 2028 |
$3,660 |
|
September 1, 2028 through August 31, 2029 |
$3,880 |
If the parties mutually exercise the three-year renewal option, monthly payments will be:
|
|
|
|
Renewal Period |
Monthly Payment |
|
September 1, 2029 through August 31, 2030 |
$4,113 |
|
September 1, 2030 through August 31, 2031 |
$4,360 |
|
September 1, 2031 through August 31, 2032 |
$4,622 |
The $2,300 security deposit paid under a prior lease will continue to be held by the property owner and will satisfy the security deposit requirement under the new agreement.
Under the proposed lease, the Library will continue to be responsible for operational expenses associated with the facility, including interior pest control, internet and information technology services, janitorial services, operational and cleaning supplies, garbage service, security, telephone service, and certain minor repairs and maintenance. The property owner will remain responsible for major building systems and structural maintenance, including the foundation, exterior and load-bearing walls, HVAC, plumbing, electrical systems, roof, exterior pest control, parking lot, landscaping, and other building systems identified in the agreement. The Library will remain responsible for the first $1,000 annually in eligible daily repairs and maintenance, with individual repair invoices not to exceed $200.
Continuing the lease at the existing location will allow the Library to maintain uninterrupted services in Linden without the costs and operational impacts associated with relocating the branch.
It is recommended that the City Council authorize the City Manager to execute the proposed lease with Magnasco Investments and take all appropriate and necessary actions to carry out the purpose and intent of the motion.
FINANCIAL SUMMARY
The Stockton-San Joaquin County Library Operating Agreement provides County funds and financial resources to operate and manage County library branches, including the Linden Library. Lease and operational expenses associated with the Linden Library are funded through the annual allocation of San Joaquin County funds. Monthly rent under the proposed lease will begin at $3,452 and increase to $3,880 during the initial three-year term. If the mutual three-year renewal option is exercised, the monthly rent will increase from $4,113 in the first renewal year to $4,622 in the final renewal year.
The existing $2,300 security deposit will continue to be held by the property owner, and no additional security deposit is required at execution of the proposed agreement.
Lease payments and related operational costs are included in the Library Approved Budget and will continue to be included in future year budgets in account 5012-810-630017-100-120-40-50-000-000. There is no financial commitment to the City's General Fund resulting from the recommended action. All operational costs for the Linden Library are funded by San Joaquin County through the Stockton-San Joaquin County Library Operating Agreement.
Attachment A - 2026 Commercial Lease Agreement for Linden Library