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SR-908-000 (3) I- , . . . b...N ~\!r ~t \911 CED:CNS:BS:srsn Council Meeting 11-22-88 yt? 1- t?t?o Santa Monica, California .- ~--j \ I TO: Mayor and city Council FROM: city staff SUBJECT: Recommendation to Appropriate Additional Funds for Renovation of city-owned Property at 602, 604, and 612 Colorado Avenue INTRODUCTION This report requests the appropriation of $25,000 in Development Agreement Funds pursuant to the city's Agreement with J.H. Snyder Company to be used to cover additional renovation costs of Ocean Park community Centert s Homeless Drop-In Center and Day Break Shelter at 612 Colorado. It also requests an appropriation of $65,000 from General Fund Reserves to cover the cost of renovation and improvements to 10,000 square feet of office/warehouse space at 602 and 604 Colorado. BACKGROUND In previous actions, the city approved the use of 33,500 square feet of City-owned property at 602, 604 and 612 Colorado for the following uses: 10,000 sf - lease to Rand Corporation with rehabilitation and improvements to be provided by the lessee; 7,123 sf - lease to Ocean Park Community Center with rehaoi- litation provided by Federal McKinney Act funds, - 1 - Co-'" NOr 2 2 19ae - -----. ./ . . snyder Development Agreement Funds, and lessee fundraising: 16,377 sf - lease to non-profit organizations with rehabili- tation provided by city's General Fund and additional improvements by lessees. DISCUSSION The project is proceeding on schedule with renovation and leasing activities of the portion leased to Ocean Park community Center and non-profit organizations well underway. However, in order the complete the project, the following actions are needed: (1) Additional funds for unforeseen electrical work: As rehabilitation of 612 Colorado proceeded, inspections revealed a number of problems with the existing electrical systems which needed repair. This requires an additional $25,000 in funds to meet code requirements. (2) Additional funds for renovation of 602 and 604 Colorado: When Council approved this project in February of 1988, Rand Corporation had been identified as the potential tenant for the 10,000 square feet of office/warehouse space. The Rand proposal included assuming responsibility for its own tenant~ improvements. Subsequently, Rand withdrew its proposal and the city retained a leasing agent to lease this space. All proposals submitted to date have requested that the City provide basic tenant improvements (air conditioning/heating, accessibility modifications to entrances and restrooms, carpeting, painting). Based on a prelimary plan for up to five tenant suites in this - 2 - .. .,-. ... . . area, the renovation cost estimate is $65,000. These costs would be recovered through the ability to conunand increased rent for that space and could be recouped within twenty four months. FISCAL/BUDGETARY IM?~C:T Funds in the amount of $25,000 are available pursuant to the Development Agreement with J .H. Snyder Company for electrical work for the opec component. There will be no impact on the Ci ty J S General Fund. Appropriation authority is requested in account 01-720-262-143-956. In addition, approval is requested for the award of these funds to Ocean Park community Center for rehabilitation. Funds in the amount of $65,000 for rehabilitation of 602 and 604 Colorado available Reserves. Funds from. General are Appropriation authority account is in requested 01-720-262-000-952. RECOMMENDATION city staff recommends that the City council (1) approve appropriation authority in the amount of $25,000 in account Ol-720-262-143-956~ (2) approve the award of these funds to Ocean Park Community Center for rehabilitation; and (3) approve appropriation authority in the amount of $65,000 in account 01-720-262-000-952. Prepared by: Barbara Stinchfield, Community Development Manager Department of Community and Economic Development - 3 -