HomeMy WebLinkAbout05 EXTENSION OF LEASE FOR FOOD/BEVERAGE AT TUSTIN SPORTS PKAGENDA REPORT
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MEETING DATE:
TO:
FROM:
SUBJECT:
APRIL 15, 2014
JEFFREY C. PARKER, CITY MANAGER
Agenda Item 5
Reviewed:
City Manager
Finance Director N A
DAVID A. WILSON, DIRECTOR, PARKS AND RECREATION
EXTENSION OF LEASE AGREEMENT FOR OPERATION OF
FOOD /BEVERAGE CONCESSION AT TUSTIN SPORTS PARK
SUMMARY:
The City entered into a five (5) year Lease Agreement with Luigi and Amy Ravetto, dba
Express Sports Cafe, in March 2006 to operate the food /beverage concession at the
Tustin Sports Park. The Agreement was then extended for three (3) years on April 5,
2011. After evaluating the operation, and reviewing two years of tax returns from the
business, staff concluded that raising the lease amount was not a feasible option at that
time, and recommended extending the lease for three (3) years rather than the five (5)
years specified as an option in the agreement in anticipation of economic conditions
improving.
Consistent with the terms of the Agreement, the lessee has requested the second and
final extension of their lease. Staff recommends approval of Amendment No. 2 which
would extend the terms of the Agreement for five (5) years and allow the business to
continue providing food and beverage concessions to park patrons. When this
extension expires in 2019, a new Lease Agreement will be necessary.
RECOMMENDATION:
Staff recommends that the City Council execute Amendment No. 2 to the Lease
Agreement between Luigi and Amy Ravetto (dba Express Sports Cafe) and the City of
Tustin, thus extending their lease by five (5) years.
FISCAL IMPACT:
The terms of the Lease Agreement require the lessee to pay a rent of three hundred
dollars ($300) per month except during the month of December of each year, when the
business will be closed and no rent shall be due. After reviewing the market value of
similar retail space, staff is recommending that the current monthly lease amount be
increased 25% to $400.
BACKGROUND:
The Express Sports Cafe began operating the food /beverage concession at the Tustin
Sports Park in October 2000 on an assigned lease. When that lease ended, the City
entered into a five (5) year Lease Agreement with Express Sports Cafe in March 2006,
which was then extended for three (3) years on April 5, 2011. In this time, the business
has satisfactorily operated the facility and complied with all terms of the Lease regarding
the operation of the concession.
In a letter dated December 18, 2013, Luigi and Amy Ravetto requested the Lease
Agreement be extended for a term of five (5) years. After reviewing the procedure for City
real property leases in the Tustin Municipal Code (Ord. No. 1389, Sec. 1 - Procedure for
Approval, Extension or Modification of Existing City or Redevelopment Real Property
Leases), staff evaluated the property as well as the operation and financial documents of
the business. Based on this review, staff is recommending the Lease Agreement be
extended for five (5) years with a 25% increase in the monthly lease amount. Both of these
actions are consistent with the terms of the original agreement. This matter has been
reviewed by the City Attorney's office and Amendment No. 2 has been approved as to
form.
Parks & Recreation
AMENDMENT NO. 2
TO THE LEASE AGREEMENT FOR THE TUSTIN SPORTS PARK
FOOD /BEVERAGE CONCESSION
This Amendment No. 2 is made this 15th day of April, 2014, by and between the
CITY OF TUSTIN ( "CITY ") and Luigi and Amy Ravetto, P.O. Box 61524, Irvine, CA
92602, dba Express Sports Cafe ( "LESSEE ").
RECITALS
Whereas, on March 20, 2006, CITY and LESSEE entered into a five (5) year Lease
Agreement ( "AGREEMENT ") to operate the food /beverage concession at the Tustin
Sports Park (12850 Robinson Drive), and
Whereas, on April 5, 2011, Amendment No. 1 extended this Lease Agreement for a
period of three (3) years; and
Whereas, LESEE may apply for a second extension of this Lease Agreement
subject to CITY's exclusive discretion under section 2.3 of the Agreement, and
Whereas, LESSEE has requested an extension to the Agreement, and
Whereas, LESSEE is in compliance with the terms of this lease and the CITY wishes
that the LESSEE continues to operate the food /beverage concession at Tustin Sports
Park, and
Whereas, it is in the best interest of both parties that the Agreement be extended for
a period of three years,
NOW, THEREFORE, based on the promises and mutual covenants herein, the
parties agree as follows:
1. Extension of Agreement.
Effective April 15, 2014, the term of this lease shall be extended for a period of
five (5) years.
2. Rent.
Effective April 1, 2014, the monthly rent amount as provided in Section 3.1 of the
Agreement shall be increased to Four Hundred Dollars ($400).
3. Other Terms and Conditions of Agreement
All other terms of the Agreement remain in full force and effect.
In Witness Whereof, the parties hereto have executed this Amendment No. 2 to
be effective as of the date set forth above.
APPROVED AS TO FORM:
By: u
City Attorney
LESSEE
Luigi Ravetto
Express Sports Cafe
Amy Ravetto
Express Sports Cafe
LESSOR
CITY OF TUSTIN
Jeffrey C. Parker
City Manager