SR-6-V (14)
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Council Meeting: April 23, 1991
APR .. -.; ,,"\
Santa Monica, California
TO:
The Mayor and City Council
FROM:
City staff
SUBJECT: Recommendation to Authorize City Manager to Negotiate
and Execute Two Leases at 602 Colorado
INTRODUCTION
This report recommends that City council authorlze the City
Manager to negotiate and execute leases wlth Finne Architects for
space at 602C Colorado and with Mulder-Katkov Architecture for
space at 6020 Colorado Avenue. After extensive but unsuccessful
marketing for art gallery replacement tenants, staff found
alternative tenants who can effectively use the unique space
configuration. This report discusses marketing efforts, the new
tenants, and the terms of their Lease Agreements.
BACKGROUND
On January 26, 1988, City Council authorized the short term
rental use of Richard's surgical building located at 602-612
Colorado Avenue until permanent disposition of the property had
been determined. For most of 1990, the building had been fully
occupied by twelve (12) social service organlzations and four art
galleries.
Two of the art galleries could no longer sustain
their space and moved out.
Because of the unique configuration of the space to accommodate
art display, separate access off of 6th street, and the proximity
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of neighboring art galleries, every effort was made to replace
the two failing galleries with other galleries. Marketing
included advertising in a local newspaper and art reporter, and
mailings to southern California galleries and museums. Only a
few galleries responded, and they were not interested in a
short-term lease. An appropriate non-profit tenant was not
found. Of all the potential tenants, the two most compatible
with the space and neighboring tenants were the two architectural
firms.
DISCUSSION
occupying 367 square feet of space at 602C Colorado Avenue will
be Finne Architects, an architectural design firm owned by Nils
Finne who is currently based in Santa Monica. The lease term 1S
for one (1) year and seven (7) months, ending December 31, 1992
when all leases in the building expire. The rental rate is $1.30
per square foot per month, triple net, with a Consumer Price
Index (CPI) adjustment annually. All other terms and conditions
of the lease are standard for the City.
Occupying 794 square feet of space at 6020 Colorado Avenue will
be Mulder-Katkov Architecture, owned by Miriam Mulder and Richard
Katkov, partners. The lease term is for one (l) year, with an
option to renew the lease for an additional seven (7) months.
The rental rate is $1.30 per square foot per month, triple net,
and Consumer Price Index (CPI) adjustment annually. All other
terms and conditions of the lease are standard for the City.
Tenant Improvements provided for both tenants are minimal.
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BUDGET IMPACT
The total monthly rental income from Finne Architects will be
$572.52; rent from Mulder-Katkov Architecture will be $1,238.64.
This amount is nearly equivalent to the previous tenants' rents.
The change in projected income for FY 1990-9l would be $7,184.40
less due to four months vacancy.
Rental income for 602-612
Colorado
Avenue
is
deposited
in
Account
Number
01-200-263-00000-0410-10000.
Security
deposits
totaling
$1,81.1..1.6 from the tenants will be held on the General Fund
balance sheet.
RECOMMENDATION
staff respectfully recommends that City council authorize the
City Manager to negotiate and execute leases with Finne
Architects
for
602C
Colorado
Avenue
and
Mulder-Katkov
Architecture for 602D Colorado Avenue.
Prepared by: Peggy Curran, Director,
Community Development Department
Ruta Skirius, Sr. Administrative Analyst
Economic Development Division
Community Development Department
(cccollse)
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