HomeMy WebLinkAboutAgenda Report - August 16, 2006 E-13AGMDA ITEM E-13
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AGENDA TITLE: Authorize City Manager to terminate the Lease Option Agreement with Lodi City
Center 12, LLC, for the retail space in the Lodi Station Parking Structure
MEETING DATE: August 16, 2006
PREPARED BY: City Manager
RECOMMENDED ACTION: Authorize City Manager to terminate the Lease Option Agreement
with Lodi City Center 12, LLC, for the retail space in the Lodi Station
Parking Garage.
BACKGIIIOUND INFORMATION: The City of Lodi and Lodi City Center 12, LLC (Optionee), entered
into a Master Lease Option Agreement on December 151h, 2004,
granting the exclusive right to exercise an option to lease the retail
space in the Lodi Station Parking Structure. While the property
remained vacant and the Optionee was in the process of hiring a second leasing agent, the City was
approached by a group of community members interested in establishing a science museum at the site.
The City Manager requested that the City be released from its agreement with the Optionee in a letter
sent to Mr. Ed Barkett on June 7, 2006 (Exhibit A), came to an agreement, and went forward to the City
Council with a proposal from the World of Wonder Science Museum. A subsequent option and lease
with the WOW were drafted and approved by the Lodi City Council on August 2, 2006. This Termination
of Master Lease Option Agreement with Lodi City Center 12, LLC formalizes the decision.
FISCAL WPACT: The City of Lodi Transit Fund will reimburse Lodi Stadium 12, LLC
the $10,000 deposit made as a condition of the lease.
FUNDING AVAILABLE:
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Ruby PaisW, Financial Services Manager
Blair King
City Manager
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Attachments
cc: Ed Ba*ett, Atlas Properties
Tiffani Pink, Transportation Manager
APPROVED:
B ing, City Manager
TERMINOkTION OF MASTER LEASE OPTION AGREEMENT
The City of Lodi, a municipal corporation and Lodi City Center 12, LLC, a
California Limited LiaWy Company hereby agree to terminate the Master Lease Option
Agreemerit dated Deaomber 15, 2004 and all rights and obligations created thereunder.
LADDI CITY CENTER 12, LLC
By A#as Properties, Inc.
It# Manager
Edward A. Bar(W t
President
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OPTIONOR:
CITY OF LODI, a California
municipal corporation
By:
Blair King
City Manager
Attest:
Jennier M. Perrin
interim City Clerk
Approved as to Form:
D7919M Sch user
City Attorney
CITY COUNCIL CITY OF L O D I
SUSAN HITCHCOCK,cycle-
Mayor
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BOB JOHNSON,
Mayor Pro Tempore
JOHNI BECKMAN
t
LARRY D. HANSEN
JOANNE MOUN+CE
CITY HALL, 221 WEST PINE STREET / P.Q. BOX 3006
LODI, CALIFORNIA 95241-1910
(209) 333-6702 1 FAX (209) 333-6807 1 www.lodi.gov
June 7, 2006
Mr. Ed Barkett
2900 March Lane, Suite 250
Stockton, CA 95219-8218
Dear Ed,
EXHIBIT A
BLAIR KING,
City Manager
JENNIFER PERRIN,
Interim City Clerk
D. STEPHEN SCHWABAUER,
City Attorney
A group of local residents recently approached the Lodi City Council with a request to
lease the vacant retail space in the Lodi Station Parking Structure for use as an interactive science
museum. The newly formed non-profit, Lodi Science Museum, has proposed a six-month
fundraising/work pledge effort to secure the necessary tenant improvements. If successful, the
organization will be given additional time to complete the project and open the museum.
As you are aware, a variety of challenges faces any leasing agent responsible for the
marketing of this property. Prospective tenants are reluctant to lease the space until improvements
are made to the properties on the west side of the street, while property owners of those properties
are reluctant to invest in improvements while the parking structure spaces remain vacant. It may
be time to re-evaluate the current strategy and consider a venture that has the potential to
significantly increase foot traffic and bring additional customers to the area.
At this time, we ask that the City of Lodi be released from the contract granting Lodi City
Center 12 an option to exercise a master lease on the retail space at the Lodi Station Parking
Structure. The City is prepared to reimburse your $10,000 deposit and enter into negotiations
with the Lodi Science Museum. If the Museum is unable to secure the funds and pledges within
the six-month timeframe, we will then invite you to again consider an option to the master lease.
We look forward to your response and the opportunity to move forward on the Lodi
Station project.
Sincerely,
Blair King
City Manager
cc: Steve Schwabauer, City Attorney
Richard Prima, Public Works Director
TERMINATION OF MASTER LEASE OPTION AGREEMENT
The City of Lodi, a municipal corporation and Lodi City Center 12, LLC, a
California Limited Liability Company hereby agree to terminate the Master Lease Option
Agreement dated December 15, 2004 (the "Agreement') and all rights and obligations
created thereunder; and
The City of Lodi hereby agrees to reimburse Lodi Stadium 12, LLC the $10,000
deposit made as a condition of the Agreement from the City of Lodi Transit Fund; and
The City of Lodi further agrees to reinstate the Agreement with Lodi Stadium 12,
LLC, under the same terms and conditions as set forth in the Agreement, in the event
World of Wonder (WOW) Science Museum fails to exercise the Option to Lease under
its agreement with the City of Lodi dated August 2, 2006.
OPTIONEE: OPTIONOR:
LODI CITY CENTER 12, LLC
By Atlas Properties, Inc.
Its Manager
By:
Edward A. Barkett
President
CAICity/Contracts/Lod!CityCenterl2LLC.doc
CITY OF LODI, a California
municipal corporation
By:
Blair King
City Manager
Attest:
Jennifer M. Perrin
Interim City Clerk
Approved as to Form:
D. Stephen Schwabauer
City Attorney
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