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Council Meeting October 13, 1998
Santa MOnica, California
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TO Mayor and City Council
FROM City Staff
SUBJECT Recommendation to Authorize the City Manager to Negotiate and Execute
an Agreement with Cardinal Broadway PropertIes to lease office space at
525 Broadway
INTRODUCTION
ThIS report recommends that the CIty CouncIl authorize the CIty Manager to negotIate and
execute an agreement with Cardinal Broadway Properties to lease office space at 525
Broadway
DISCUSSION
A need for additional office space has been Identified for three City divIsions - CltyTV,
Information Systems DIvIsion (ISO) and the Engineering DIvIsion CltyTV needs to be
relocated from the trailers In back of City Hall due to construction of the Public Safety
BUilding Both ISD and the Engmeerlng DIvIsion have expenenced increasing workloads
and proJect backlogs due to unprecedented Investment Capital Improvements and the
development of computer and telecommunication system Improvements As a result staff
has outgrown ItS eXlstmg offIce space City Staff attempted to find space for these
functions wlthm the City Hall complex but that effort was futile A search for appropriate
space to co-locate these three functions was undertaken. The features Identified for the
space mclude room to park the CltyTV van, office space which could be configured to
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accommodate a computer training room, severai conference rooms and office space for
24 employees, appropriate heating and cooling system requirements for CltyTV and ISO
equipment, and proximity to CIty Hall Staff vIsited numerous sites In close proximity to City
Hall and Identified 7834 square foot office space at 525 Broadway as the most deSirable
location DISCUSSions With the property owner ensued and resulted In agreement on
tentative terms and conditions The City has proposed, subJect to Council approval, that
the term be ten years With options to cancel the lease after years five, seven, and nine
(With a reasonable cancellation penalty) The initial rent Will be $2 15 per square foot With
an annual escalator of SIX percent The escalator will be In lieu of a CPI adjustment as well
as any Increases In bUilding operating expenses and real estate taxes The landlord IS
planning to proVide a tenant Improvement allowance so that the space can be modified to
meeting the diverse needs of these three diVISions
BUDGET/FINANCIAL IMPACT
The annual cost In the first year to rent thiS space IS $222,272 ThiS cost will Increase by
6 percent per year over the life of the lease Funds for thiS lease are In the current fiscal
year budget at account number 01-700-274-00000-2262-00000 In future fiscal years,
funds for the lease payment Will be Included In the budget at the same account number
and Will reflect the appropriate cost
RECOMMENDATION
It IS recommended that the City Councli authOrize the City Manager to negotiate and
execute an agreement With Cardinal Broadway Properties to lease office space at 525
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Broadway for various City Departments
Prepared By
Katie E Llchtlg, Assistant to the CIty Manager for Management Services
Jory Wolf, Manager, InformatIOn Systems DIVISIon Manager
Robin Gee, Cable TelevIsion Manager
Anthony Antlch, City Engineer
Gretchen Kubacky, Senior Real Estate Analyst
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