ACTION REQUESTED:
Title
Communication from the City Manager with a Request to APPROVE the THIRD AMENDMENT to the LEASE AGREEMENT for the ROCK ISLAND DEPOT Located at 212 SW WATER STREET.
Body
BACKGROUND:
A Master Lease has governed the occupancy of the Rock Island Depot, City owned property at 212 SW Water Street, since August 1979. The original lessee, River Station Square Company, was succeeded by Mathers Company. In 1998, the lease was amended for the first time to reduce the size the leased premises, eliminate the lessee's development rights and revise the lessee's parking rights. In 2000, with the consent of the City, the lease was assigned to River Station LLC. On September 14, 2014, the lease was amended a second time to revise the rent structure to eliminate a 2% rent based on gross sales and replace it was a set amount per square foot.
The lease had a 20-year term plus three, 10-year options that were executable exclusively by the Lessee. The original term ended in 1999. The final option will expire in 2029.
Recently, River Station LLC has been working with a new tenant that will go into unused space in the building. Build-out and renovation of that space will require $150,000 improvements. Renovations of existing facilities is a TIF eligible expense. As the City is the owner of the building, it can use $75,000 in TIF funds toward this expense. The Lessee will be required to, at a minimum, match the cost of the City's contribution.
FINANCIAL IMPACT: $75,000 in TIF funds.
NEIGHBORHOOD CONCERNS: N/A
IMPACT IF APPROVED: Lease will be amended to reflect $150,000 in improvements, with the City contributing $75,000 to the renovation costs.
IMPACT IF DENIED: The lease will not be amended.
ALTERNATIVES: N/A
EEO CERTIFICATION NUMBER: N/A
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