Agenda - Council - 06/22/2021 - Laserfiche WebLink

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The 17b RCP report discussed potential future use of the Old Town Hall. Uses contemplated ranged from a public space, museum, school, arts, business and incubator. Staff has received multiple requests about the availability of the building for lease for various types of businesses. Schools and retail uses have approached the City but due to the condition and renovation needed to the building the users go elsewhere. These users are excited at the possibility of using this unique building and think its allure will benefit their businesses. The current interested party has been very patient with the City and the use of a boutique with limited hours seems like a great fit for this building. Parking is also difficult to solve for and any agreement with a future tenant would likely need some sort of cross parking easement with the adjacent properties. Staff believes there is an opportunity to preserve a historic building and to add a unique building to the lease market. The City has been presented a fair offer to lease the Old Town Hall from the Small Town Boutique. In order to move to the next step the City Council must consider taking the initiative to renovate Old Town Hall and to put the building back into service. If the City Council is comfortable moving forward with the renovation, Staff would ask for authorization to obtain quotes to complete the Climatization and Pre -Occupancy Upgrade outlined in the RCP 17B report. The Old Town Hall has an estimated 778 SF of leasable space. It includes a bathroom, main hall and cloak room. Staff has consulted with a local real estate agent and market rate rent for this building would be in the $12-$18 / square foot range with the tenant responsible for the utilities / snowplowing and the City responsible for the property taxes. The offer by Small Town Boutique is market rate as outlined below: Year 1 - $10,200 (13.11 / SF) Year 2 - $15,000 ($19.28 / SF) Year 3 - $15,000 ($19.28 / SF) This business has an online presence at https://stgboutique.com and moving to a brick and mortar store certainly has risk. Staff has put together a projected lease summary (see attached) and identified the break-even point if renovation expenses are accurate. This preliminary analysis shows a breakeven point, from a new City investment perspective, of five years. Getting quotes from contractors can confirm the renovation numbers and verify the analysis. Next Steps The City Council will need to review the information presented and ultimately come to a decision on how to proceed in relation to the Renovation and / or lease of the Old Town Hall. Alternatives: Renovation 1. Direct Staff to obtain quotes to complete the full renovation and to utilize EDA / HRA funds to complete the renovation. (EDA Recommendation) 2. Direct Staff to complete the Climatization work to preserve the Old Town Hall and improve its appearance. (Future Step after obtaining quotes) 3. Something Else Lease 1. Direct Staff to enter into exclusive negotiations with Small Town Boutique. (EDA Recommendation) 2. Direct Staff to complete the renovation and to put on lease market after renovation is complete 3. Something else. Funding Source: