Agenda - Council - 10/27/2009 - Laserfiche WebLink

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CASE # _q CONSIDER OFFER TO LEASE PROPERTY LOCATED AT 6701 HWY 10 TO RED BOBBIN SEWING SALON By: Sean M. Sullivan, Economic Development Coordinator Background The City, of Ramsey purchased the properly located at 6701 utilizing hinds from the RALF program. Currently, a portion of the building is being leased by Youth First and K & K Sharp. There currently is a tax exempt, vacant , conference room on the west side consisting of approximately 512 square feet. Glorya Kackman of Red Bobbin Sewing Salon has submitted a lease proposal to utilize the aforementioned space. Red Bobbin provides costume design services to the Ramsey Community Theater at no charge, but also does costume design work as a for - profit entity. The space would be used as a place to perform costume fabrication and to house sewing equipment. The offer from Red Bobbin is attached and a summary is provided as option A. Premier Commercial Properties, the City property manager for this site, has reviewed the proposal and has made the determination that the offer is not market rate. The details of these findings are provided in the attached letter and a summary is presented as Option B. There are other issues concerning the space that would also have to be worked through before a final lease solution can be reached. The tenant is proposing that the base rent include the utilities of the space. However, Youth First is currently responsible for those utilities and collecting a portion of them from the 'Community Theater. The space is also considered tax exempt and the prospective tenant will be performing both taxable and tax - exempt activities at the site. Staff is looking for direction to accept, reject, or to make a counteroffer to the prospective tenant. Option A (Red Bobbin Sewing Salon Proposal) Term: November 1, 2009 — April 30, 2010 and on a month to month basis following that period Rent: $50 /month. This amount is inclusive of utility costs.. Taxes: Included in proposed rent above. Uses: Design and fabricate costumes for the Ramsey Community Theater as well as for - profit customers. Insurance: Tenant will maintain public liability insurance on Subject Parcel. Utilities: Included rent proposed above. Subletting: Tenant may not sublet during lease term. Improvements: Tenant will take the space as -is, however all mechanical, plumbing; and lighting systems shall be properly operational. Comments: The proposed lease is not considered "market rate ".