ACTION REQUESTED:
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Communication from the City Manager and Corporation Counsel with a Request to APPROVE the FOURTH AMENDMENT to SITE LEASE AGREEMENT for the GWYNN PARK CELL TOWER.
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BACKGROUND:
American Tower Corporation leases and operates a cell tower site near Fire Station 8 at the intersection of McArthur Highway and Hurlburt Street. The initial lease commenced on December 1, 1999. The lease has been amended three times since, including changes to the payment schedule, renewal terms, and the amount of land leased. American Tower Corporation recently requested rent concessions in order to avoid terminating its lease. American Tower Corporation cited industry pressure to reduce costs as well as pressure from a transition toward alternative small cell technology.
Currently, American Tower Corporation pays $1,752.90 per month in rent, plus profit-sharing fees for co-locators at the cell tower. American Tower Corporation has renewal options through 2036, with renewals dates in between. Upon reaching a renewal date, American Tower Corporation may choose to renew or terminate the lease. The next renewal date is in December 2024.
Under the terms of the proposed lease amendment: 1) The City of Peoria would receive a one-time signing bonus of $4,500.00; 2) Rent would be $1,400.00 per month commencing on December 1, 2020; 3) There would be a 3.0% annual escalation in rent; and 4) There would be three additional renewal periods of five years each, with a final expiration date of November 30, 2051. The proposed lease amendment does not alter the current profit-sharing revenue for co-locators.
NEIGHBORHOOD CONCERNS: None.
IMPACT IF APPROVED: The City will continue to receive rent and co-locator revenue from the Gwynn Park cell tower site.
IMPACT IF DENIED: The City could lose future rent and co-locator revenue from the Gwynn Park cell tower site if American Tower terminates its lease at the next renewal date.
ALTERNATIVES: N/A
EEO CERTIFICATION...
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