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HomeMy WebLinkAboutRDA 04 LEASE AG TFYC 02-03-97RDA NO. 4 2-3-97 DATE: February 3, 1997 i n t e r- C o rn TO: FROM: SUBJECT: William A. Huston, Executive Director Community Services and Redevelopment Agency Staff APPROVAL OF LEASE AGREEMENTS FOR THE TUSTIN FAMILY & YOUTH CENTER (TFYC) SUMMARY: Approval is requested for two Lease Agreements for a portion of property located at 14722 Newport Avenue, described as the Tusfin Family and Youth Center. RECOMMENDATION: It is recommended that the Agency approve lease agreements (copies of which are attached to Agenda Item #1) with Orange Children and Parents Together, Inc. (OCPT) and the Children's Bureau of Southern California (CBSC), for a portion of the Tustin Family & Youth Center, and authorize the Assistant City Manager to execute the lease agreements after their execution by the City Attorney. FISCAL IMPACT: The estimated lease revenue to be returned to the Redevelopment Agency over the initial five year term of the two leases is $71,510. The estimated prorated portion of common area operating costs to be reimbursed by both leases over the initial five year term is estimated at $111,710. This amount will be transferred from the Agency and credited to the TFYC operating budget in the General Fund. BACKGROUND/DISCUSSION: The TFYC is scheduled to be fully opened in late February. The 5,934 sq.ft, neighborhood service center will provide a full range of family and youth-oriented social, educational and recreation programs; and serve as a resource referral center for families and youth of Southwest Tustin in need and at risk, and for individuals seeking self-improvement and vocational oppommities. Services will be provided by member agencies of the TAFFY (Tustin Acts For Families & Youth) Coalition, primarily through implementation of Healthy Start and Family Preservation Grants by the Children's Bureau of Southern California (CBSC) and Orange Children and Parents Together, Inc. (OCPT), as well as the City's Community Services Department. The Agency is also proposing to lease a portion of the facility to OCPT and CBSC. The OCPT lease space includes 3,583 sq.ft, of the facility and a 3,895 sq.ft, outdoor playground February 3, 1997 Page 2 area. OCPT will provide licensed Head Start programming, providing child care and readiness programs to 51 neighborhood children, ages 3 ½ to 5 years. The CBSC lease space would include 543 sq.ft, of the facility and be used to coordinate educational and special service programs. Both lessees are obligated to make annual payments. Payments are based on a base rent for the use of the land and a prorated share of reimbursable operating costs, such as utilities and janitorial services. The following table illustrates the initial first year tenant rent obligations: LESSEE INITIAL INITIAL ESTIMATED TOTAL BASE RENTS. REIMBURSABLE PAYMENT OPERATING COSTS OCPT $11,450.00 $ 16,696.00 $ 28,146.00 CBSC $1,753.00 $2,556.40 $4,309.40 TOTAL $13,203.00 $19,25.2.40 $32,455.40 Since the Center is owned by the Tustin Community Redevelopment Agency, the base rent will be transferred to RDA-SC Project Area to partially offset development costs for the project. Rent figure will be adjusted annually based on the lesser of an increase in the Consumer Price Index or four percent (4%). . The lessees' prorated portion of the estimated reimbursable common area operating costs for the facility, estimated at $39,220, is $19,252.40. This amount will be credited to the TFYC operating budget in the General Fund. The remaining balance of the operating costs will be paid by the City. The following is a summary of other important elements of the leases: The term of the leases is for a period of five (5) years, with two, five (5) year extension terms for CBSC, and one, five (5) year extension term for OCPT. Though the space covered under these leases is proprietary, the City, as well as the tenants, will have permission to use each other's areas for approved supervised programming when not in use. OCPT (Headstart) is responsible for installing needed exterior tenant improvements to the outdoor play area, which must be of a high quality, and are subject to City approval. Both lessees are responsible for the first year's annual rents to be paid in advance of occupancy. February 3, 1997 Page 3 Each lessee will be required to provide the apprOpriate faith performance bond or its equivalent, as well as insurance for comprehensive liability, property coverage, workers' · compensation and builder's risk (in the amount indicated in the agreement). Each lessee is also responsible for indemnifying and holding the City and its employees harmless against any claims, injuries or losses resulting from construction or tenant operations. Staff will be available at the meeting to respond to any questions. Mlke Henley Director, Community Servic,6_..s/ wp/tfyc/sc/b:leaserpt.wah Christine Shingleton ?,~ Assistant City Manager '-"