Ordinance 3069
CITY OF ALAMEDA ORDINANCE NO. 3069
New Series
APPROVING A LEASE AND AUTHORIZING THE CITY MANAGER
TO EXECUTE DOCUMENTS NECESSARY TO IMPLEMENT THE
TERMS OF A LEASE AMENDMENT WITH AUCTIONS BY THE
BAY FOR TEN YEARS WITH AN ADDITIONAL OPTION OF TEN
YEARS IN BUILDING 20 LOCATED AT 2701 MONARCH STREET
AT ALAMEDA POINT
WHEREAS, the City entered into the original agreement with Auctions By the
Bay for Building 20 in May 2012; and
WHEREAS, the first lease was short term to allow the tenant to gain site
control to begin major capital improvements and to allow times for the City and
tenant to negotiate the proposed longer term lease; and
WHEREAS, Building 20 is a 63,972 square feet hangar located nearest to the
Northwest Territories; and
WHEREAS, Auctions By the Bay has developed into Michaan’s Auctions and
has become a regional public draw, creating synergy between the monthly
Antiques Fair and other public attractions located along Monarch Street (“spirits
alley”); and
WHEREAS, since executing the short term lease, the tenant had upgraded
hangar 20 into a unique showplace for art and antiques; and
WHEREAS, the proposed new lease terms help the tenant finance
improvements and continue investment into the property as development occurs
at Alameda Point. The sole purpose for which the premises may be used by the
tenant is for warehouse, pre-sale viewing of antiques, auctions, general office
and indoor antiques fairs and any other related uses permitted by the City of
Alameda Use Permit; and
WHEREAS, the long-term reuse of this hangar for this lease is consistent with
the term of other leases along this row of hangars and is consistent with the long-
term development plans for Alameda Point. This row of hangars is highly
restricted by the Biological Opinion issued by the United States Fish and Wildlife
Service, severely limiting new development opportunities.
WHEREAS, the tenant has requested an option to purchase building 20
which will be negotiated outside of the lease document and will return to the
governing body for approval.; and
WHEREAS, the monthly base rent over the ten years is $22,390 for year one,
$23,062 for year two, $23,754 for year three, $24,466 for year four, $25,200 for
year five and $25,956 for year six, $26,735 for year seven, $27,537 for year
eight, $28,363 for year nine and $29,214 for year ten; and
WHEREAS, after the first ten year term, the lease will be evaluated to
determine fair market value via lease negotiation. If no agreement is reached, a
baseball arbitration model will be used to determine the market value. In no
event shall the base rent for the option period to be less than the base rent
payable in the last month of term of this lease prior to the expiration date; and
WHEREAS, the tenant performed significant capital investment in the
property, the security deposit requirement has been waived and the lease
contains the standard insurance, indemnity, assignment and termination clauses
the ARRA required in its leases and compliant with the Lease in Furtherance of
Conveyance (LIFOC) with the United States Navy.
NOW THEREFORE, BE IT ORDAINED by the City Council of the City of
Alameda that by four affirmative votes that:
Section 1. The City Manager of the City of Alameda or his designee is hereby
authorized to negotiate, execute, for and on behalf of the City of Alameda, a
lease amendment with Auctions By the Bay for ten years with an additional
option of ten years in Building 20 located at 2701 Monarch Street at Alameda
Point, subject to such technical or clarifying revisions as are reasonably
determined necessary by the City Manager and approved by the City Attorney,
and the City Clerk is hereby authorized and directed to attest to the same.
Section 2. If any section, subsection, sentence, clause, or phrase of this
ordinance, for any reason, is held to be invalid or unconstitutional, such decision
shall not affect the validity or constitutionality of the remaining portions of this
ordinance. The City Council of the City of Alameda hereby declares that it would
have passed this ordinance, and each section, subsections, clause, or phrase
hereof, irrespective of the fact that any one or more sections, subsections,
sentences, clauses, and phrases are declared to be invalid and unconstitutional.
Section 3. This ordinance shall be in full force and effect from and after the
expiration of thirty (30) days from the date of its final passage.
________________________________
Presiding Officer of the City Council
Attest:
__________________________________
Lara Weisiger, City Clerk
City of Alameda
* * * * * *
I, the undersigned, hereby certify that the foregoing Ordinance was duly
and regularly adopted and passed by Council of the City of Alameda in regular
meeting assembled on the 7th day of May, 2013, by the following vote to wit:
AYES: Councilmembers Chen, Daysog, Ezzy Ashcraft, Tam
and Mayor Gilmore –5.
NOES: None.
ABSENT: None.
ABSTENTIONS: None.
IN WITNESS, WHEREOF, I have hereunto set my hand and affixed the
official seal of said City 8th day of May, 2013.
______________________
Lara Weisiger, City Clerk
City of Alameda