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City Council Meeting: September 23, 2008
Agenda Item: ~~' ~'
To: Mayor and City Council
From: Andy Agle, Director of Housing and Economic Development
Subject: Sub-lease of Office Space at 1717. 4t" Street, First Floor for City
Operations
Recommended Action
Staff recommends that the Council authorize the City Manager to negotiate and execute
a sub-lease with the Los Angeles Times for the first floor of 1717 4~ Street, an area of
approximately 9,462 square feet, beginning February 1, 2009 and extending through
January 31, 2010, in accordance with the terms described below.
Executive Summary
City TV and Code Enforcement are located at 525 Broadway, but will need to relocate
on May 1, 2009, when their lease expires. City TV is slated to move to 1654 19t" Street
and Code Enforcement is slated to move to the Civic Center Parking Structure, but it is
unlikely that either of these spaces will be ready for occupancy by May 1. However, a
sub-lease from the Los Angeles Times of 9,462 sq. ft. on the first floor at 1717 4t" Street
is available to begin February 1, 2009, ahd continue through January 1,-2010, at the
rate of $2.75 per sq. ft. Staff recommends that the City sub-lease this space for these
and other City operations.
Discussion
City TV, Code Enforcement and Information Services (ISD) staff is currently occupying
office .space at 525 Broadway. The lease expires May 1, 2009, and all three operations
need to relocate. ISD staff will be moving into 1901 Main Street, where the City
currently leases office space. On July 8, 2008, Council authorized a lease for City TV at
1654 19t" Street, and on July 8, 2008, Council also received a report describing plans to
relocate Code Enforcement to office space within the Civic Center Parking Structure.
However, the new locations for City TV and Code Enforcement will not be ready for
occupancy by May 1, 2009.
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Therefore, staff is recommending that the City sub-lease from the Los Angeles Times
the first floor of 1717 4th Street, through January 31, 2010. This space is 9,462 sq. ft.
and comes fully furnished. The sub-lease would commence February 1, 2009, at a rate
of $2.75 per sq. ft. The sub-lease would be subject to the Master Lease. The sub-lease
would require a deposit equal to one month's rent. During the term of the sub-lease, the
space could also be used for City operations that need to be temporarily displaced from
City Hall due to seismic retrofit work.
Since 1990, the City has been leasing the second floor in this building for the Finance
Department. The second floor lease expires January 31, 2010.
Alternatives
Staff explored other alternatives to leasing additional space including using the recently
acquired building at 1324 5th Street which formerly housed the Interim Library. However,
this building needs substantial repair, including a new roof and extensive remediation of
mold. Since this building is slated for demolition as part of a future public development,
staff concluded that the cost to upgrade the building for a short term use did not warrant
the rehabilitation cost, estimated at $400,000.
Financial Impacts & Budget Actions
Funds in the amount of $191,123 to cover the monthly rent of $156,120 for the five-
months of FY 2008-09, plus the security deposit, plus $25,000 for computer and
telephone connections, and $10,000 for moving expenses, are available in the following
accounts: City N,01207.522622; City Manager's Office, 01202.522620; and Code
Enforcement, 01321.522620
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Prepared by:
Miriam Mack, Economic Development Manager
Approved:
Forwarded to CounciL•
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Andy Agle, Director P. ont Ewell
.Housing and Economic Development City Manager
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Reference Contract No.
8979 (CCS)