SR-900-002 (14)
RMD:EDD:GK:F:\RESOURCE\SHARE\GRETCHSHARE\STAFFREPORTS\2121 Clov 100 Merl RDA Renew Exp.DOC
Council Meeting: June 14, 2005 Santa Monica, California
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Lease Amendment with 2121 Cloverfield Boulevard Associates, LLC for
Office Space for the City?s Housing and Redevelopment Agency
INTRODUCTION
This report recommends that the City Council authorize the City Manager to negotiate and
execute a lease amendment with 2121 Cloverfield Boulevard Associates, LLC to lease
office space at 2121 Cloverfield Boulevard, Suites 100 and 110A, Santa Monica, for the
City?s Housing and Redevelopment Agency office.
DISCUSSION
The Housing and Redevelopment Agency, which is part of the Resource Management
Department, is currently leasing a 1,974 square foot office at 2121 Cloverfield Boulevard,
Suite 100, Santa Monica. The lease term expires October 31, 2005. After analyzing
current market conditions and the availability of lease space in Santa Monica, it was
determined that the current space, with the addition of 606 square feet in adjacent Suite
110A, still satisfies the needs of the Housing and Redevelopment Agency. No other
space for these functions is available within City Hall or other City buildings at this time.
The Suite 100 lease contract contains a provision for a three year option, which has been
exercised. The Suite 100 lease term is thereby extended for the term of November 1,
2005 through October 31, 2008. The combined lease space totals 2,580 square feet.
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Discussions with the property owner?s representative have resulted in agreement on
tentative terms and conditions. The City has proposed, subject to Council approval, that
the existing lease term for Suite 100 be extended for an additional two months (November
1, 2008 through December 31, 2008), making the total new term for Suite 100 effective
November 1, 2005, through December 31, 2008. Additionally, staff has proposed that
Suite 110A be leased for a 42 month term, effective July 1, 2005 through December 31,
2008.
The rent for Suite 100 is currently $2.25/square foot; the new rent will be $2.27 per square
foot for Suite 100 and $2.32 per square foot for Suite 110A, with an annual escalation of
3%. The escalator will be in lieu of a CPI adjustment as well as any increases in operating
expenses and real estate taxes, and the first year?s escalation is waived for Suite 100 only.
Ten parking spaces will continue to be provided at a cost of $730.00 per month.
BUDGET/FINANCIAL IMPACT
Funds for this lease are in the current fiscal year budget at account number 01264.522620,
subledger 76027-W. In FY05/06, the annual cost to rent this space is $79,222.76
(including parking), assuming a November 1, 2005 option commencement date for Suite
100 and July 1, 2005 commencement date for Suite 110A. All annual rental costs are fully
reimbursed by the Redevelopment Agency.
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RECOMMENDATION
It is recommended that the City Council authorize the City Manager to negotiate and
execute a lease amendment with 2121 Cloverfield Boulevard Associates, LLC to lease
office space at 2121 Cloverfield Boulevard, Suites 100 and 110A, for the City?s Housing
and Redevelopment Agency, at the rental rates described above.
Prepared By: Jeff Mathieu, Director, Resource Management Department
Miriam Mack, Economic Development Manager
James Kemper, Acting Housing Administrator
Gretchen Kubacky, Senior Real Estate Analyst
Reference Contract No. 6622 (CCS).
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