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Santa Monica
City Council Meeting: July 28, 2009
Agenda Item: ~°~'-°
To: Mayor and City Council
From: Andy Agle, Director of Housing and Economic Development
Subject: Lease Agreement for the Property Located at 3300 Pico Place North
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a Lease with Morgan Auto Service for parking on the 1,746 sq. ft. property
located at 3300 Pico Place North, for a term ending July 31, 2012, at a rate of
$90/space/month, subject to an annual escalation in rent.
Executive Summary
The City owns a 1,746 sq .ft. parcel at 3300 Pico Place North that has been leased
since 2003. The lease expired on January 15, 2009, and is on a month-to-month
holdover. Staff released a Request for Proposals (RFP) to advertise the availability of
the property. Morgan Auto Service, the existing tenant, was the only respondent to the
RFP. The recommended lease with Morgan Auto Service is for $630 per mohth (based
on seven (7) tandem. parking spaces rented at a monthly fee of $90.00 per parking
space), with an annual escalation, for a term ending July 31, 2012.
background
The 1,746 sq. ft. parcel is located at 3300 Pico Place North (Attachment A). The City
has been leasing this property to Morgan Auto Service since 2003 and its predecessor
since 1993. Morgan. Auto Service uses the property for parking for its auto service
customers. There are seven tandem parking spaces on-site.
®iscussion
Prior to the lease's expiration, staff in Housing and Economic Development consulted
with staff in Planning and Community Development to determine whether the City would
be better served by making this property available for private or public parking.
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The lot is small, irregularly shaped, and in a remote location adjacent to the Santa
Monica Freeway. The pavement is in need of repair. Striping the lot to meet standards
for public parking would not result in as many parking spaces as could be made
available by a private lessee who manages tandem parking spaces.
In consideration of these factors, staff determined that this City-owned property, by
itself, would have more value to a private user than for public parking. However, staff
does not recommend selling the property at this time because there may be an
opportunity in the future to operate this lot in conjunction with an adjacent private
parking lot, to create a larger parking area that could serve the business district. Staff
plans to explore the feasibility of this concept in the coming years as LUCE
recommendations regarding district parking are implemented.
On March 19, 2009, staff issued a Request for Proposals and reissued it on May 26,
2009 for an additional three weeks due to a lack of response. The RFP was advertised
on the City's website and mailed directly to thirty businesses on Pico Boulevard. The
RFP indicated leasing preferences for a Santa Monica based business, with experience
in maintaining and operating a parking lot, and who would pay fair market rent. Morgan
Auto Service was the only respondent to the RFP.
Morgan Auto has been a City tenant since June 1, 2003 and fulfilled the obligations of
its lease. Therefore, staff recommends that Council authorize a new lease with Morgan
Auto Service for $630 per month (based on seven (7) tandem parking spaces at a
monthly fee of $90.00 per parking space), for a term ending July 31, 2012, and with an
annual escalation in the base rent based on CPI, but not less than 2%:
Financial Impacts & Budget Actions
Anticipated revenues of $7,560 from rent payments were budgeted at account number
01263.400770.
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Prepared by: Donna Rickman, Senior Administrative Analyst
Approved:
AndyAgle, C
Housing and
Attachments:
Forwarded to Council:
P.()~mont Ewell
Development City Manager
A. Location Map of 3300 Pico Place North
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~ Parcel
Reference Contract No.
9095 (CCS).