Agenda - Council - 01/13/2009 - Laserfiche WebLink

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Cc actt.c ar &Lac W. ID CONSIDER LEASE WITH MN RENAISSANCE SCHOOL FOR OFFICE SPACE AT OLD MUNICIPAL CENTER By: Heidi A. Nelson, Asst. City Administrator Background: Staff was contacted late last week by representatives of the Minnesota Renaissance School, currently located in Anoka, regarding the possibility of leasing office space at the old Municipal Center (15153 Nowthen Blvd NW). They are in need of immediate, temporary space for their school operation due to mold remediation that is required at their current facility. They are requesting a two -month lease, commencing by the end of January, with a third month option if the work in their current facility takes longer than the anticipated 4 -5 weeks. Staff has met with the representatives at the old Municipal Center as well as met internally to consider this short-term, immediate use of the facility. Staff proposes a lease agreement consistent with the following terms and conditions: ➢ The lease would be based on a total square footage of 12,810 for the main floor of old city hall and both the upper and lower levels of the old police department. > Lease term of two months with an optional third month at the same rate. > Lease rate in the range of $5 to $7 per sf, annually, prorated per month. This recommendation is based upon the short term nature of the lease, current depressed market for commercial lease space, and that the tenant is accepting the space "as is" with no improvements to the finishes or HVAC. This would yield a lease revenue of range of $10,675- $14,945 per month. ➢ Damage deposit equal to one month's rent. > Staff is in the process of determining the tax liability of this lease. MN Renaissance is a taxable entity, and therefore, staff is anticipating a tax liability on the lease of this tax exempt space. Due to the temporary nature, the county may require a payment in lieu of taxes, generally 40% of the lease revenue collected by the tax exempt entity. > The City would be responsible for clearing the snow from parking lots; MN Renaissance would be responsible for clearing sidewalks and walkways. ➢ MN Renaissance would be responsible for all janitorial cleaning and light maintenance of the facility. MN Renaissance would provide all supplies for such maintenance MN Renaissance would establish garbage and recycling service for their own use on site. ➢ MN Renaissance would pay utilities (gas, electric, water, sewer) based upon the incremental additional use that is represented by their occupancy. The City currently utilizes the lower level old city hall /fire station no. 2 as well as the lower level garage at the old police department.