Agenda - Council - 07/23/2013 - Laserfiche WebLink

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CONSIDERATIONS: •Due to City code, the only available users for the Subject Property is Pro Power Sports and Ramsey Bicycle (outside storage is an accessory use). •Council has indicated a desire develop lease rates as close to market as possible. •Based on previous lease for the Subject Property, rent for the same area was about $800 per month. •Previous lessee indicated a reason for their departure was a too expensive lease rate ($800 per month). •Based on input from Premier Commercial Realty, Staffs recommendation is reasonable given the circumstance even though is sightly below market rental rate. •Staffs recommendation covers all City fixed costs and more. Considering how the negotiation process has transpired, Staff feels $650 per month is a reasonable rate for both parties. Attached is a rent analysis for Council's ingormation. •Pro Power,s asking rental rate is .27 per square foot, the City,s proposal is .355 per square foot and low end of the market rental rate is .40 per square foot. ITEM TO NOTE (History): Pro Power Sport did move a number of empty snowmobile crates onto the Subject Property in mid December. Staff contacted Mr. Amar and requested removal of all crates. Mr. Amar requested to remove the crates after Christmas. Staff indicated removing crates after Christmas would be acceptable. After the New Year, said crates had not been removed as agreed. Staff was unable to contact Mr. Amar until mid January to express the need to remove said crates from the Subject Property. In late January, Staff notified Mr. Amar he must vacate the Subject Property immediately. At that time, Mr. Amar indicated said crates were frozen to the pavement and could not be removed;. Then, Mr. Amar began negotiating a lease agreement for the Subject Property with staff. The case before the Council is a result of the negotiation process that transpired over the last month. ALTERNATIVES: 1. Approve the proposed lease with Pro Power Sports, INC. as proposed. [Staff Recommendation] Staff believes the proposed lease is reasonable for both parties, and meets two Council objectives: retaining flexibility to terminate lease within one year and to set lease rates as close to market rates as possible. 2. Amend and approve the proposed lease with Pro Power Sports, INC. as proposed. As mentioned, Pro Power Sports INC. did partially use the Subject Property for about two months free of charge. If the Council desires to recapture lost rent, Staff could include a charge in this agreement. 3. Deny the proposed lease with Pro Power Sports, INC. and or direct different terms. Notification: Original Letter of Intent dated June 5, 2013 and proposed lease agreement signed by the Pact Charter School Board on July 11, 2013. Observations: