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RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE A LEASE AMENDMENT WITH LOCAL AGENCY FORMATION COMMISSION AT 509 WEST WEBER AVENUE
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RECOMMENDATION
It is recommended that the City Council adopt a resolution to:
1) Authorize a Lease Amendment to the lease with Local Agency Formation Commission for office space in the Waterfront Towers (509 West Weber Avenue).
2) Authorize the City Manager, or designee, to take all the necessary and appropriate actions to carry out the purpose and intent of this resolution.
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Summary
The City purchased the Waterfront Office Towers at 501 and 509 West Weber Avenue in January 2018, to serve as future City Hall. The City currently acts as landlord to several tenants with leases in the 509 West Weber Avenue building; Local Agency Formation Commission (LAFCo) is one such tenant leasing office space on the fourth floor. LAFCo has requested to extend its current lease an additional six months through March 31, 2021.
DISCUSSION
Background
In January 2018, the City of Stockton acquired the two Waterfront Office Tower buildings at 501 and 509 West Weber Avenue to serve as the future home of City Hall. A number of tenants occupy the buildings. One of these tenants is LAFCo which currently leases 1,200 s.f. of office space on the fourth floor of 509 West Weber Avenue from the City (Attachment A - Current Lease). The current lease with LAFCo expires on September 30, 2020.
Present Situation
LAFCo wishes to extend its lease with the City that is set to expire on September 30, 2020, for a six-month period through March 31, 2021. All other terms and conditions of the lease will remain unchanged and the monthly base rent will be $1,730.40, or $1.45 per s.f., which is market rate for office space of this type in Stockton ranging from $1.10 to $2.00 per s.f. Due to the progress that is being made on New City Hall the Tenant has no option to extend or renew the Lease beyond March 31, 2021.
PUBLIC NOTICE
As required, a “Notice of Intent to Grant or Lease Real Property Interest” in accordance with the provisions of Article V, Section 510, of the Charter of the City of Stockton was advertised in The Record on July 16, 2020.
FINANCIAL SUMMARY
Approval of the Lease Amendment would increase City revenue by $1,730.40 per month or $10,382.40 for the six-month period. Funds will be deposited into the Property Rental account, No. 010-0160-362.
Attachment A - Current Lease