Item CCPA-1

City Council Meeting: 03-23-99 Santa Monica, California

TO: Mayor and City Council and Members of the Parking Authority

FROM: City Attorney

SUBJECT: Recommendation to Approve Assignment of Parking Lease From 100 Wilshire Associates to Douglas Emmett Realty Fund

Introduction

This staff report recommends adoption of the attached resolutions which give City Council and Parking Authority approvals required for assignment of an existing parking lease. Adoption of these resolutions will authorize execution of consents to the assignment by the City Council and Parking Authority.

Background

On April 23, 1968, the City of Santa Monica and the Parking Authority entered into Contract Number 1828 (CCS) (the "Parking Lease") with Wilshire West Company, A California General Partnership, for the long term lease of a maximum of 320 parking spaces (and a minimum of 265 parking spaces) located in the public parking structure situated on the east side of Second Street between Arizona Avenue and Santa Monica Boulevard. Wilshire West Company required this parking to satisfy off-street parking requirements which were anticipated to be generated by the occupants of the office and commercial complex constructed by Wilshire West Company on real property it owned at 100 Wilshire Boulevard in Santa Monica.

The Parking Lease has been assigned to new lessees on 5 separate occasions in conjunction with the sale of the 100 Wilshire real property. Each assignment has been formally approved by the City Council and the Parking Authority by adoption of resolutions and execution of consents to the particular assignment.

Discussion

100 Wilshire Associates has entered into an Agreement of Purchase and Sale with Douglas Emmett Realty Fund for the 100 and 120-130 Wilshire real property parcels. Close of escrow on this sale is contingent upon the rights under the Parking Lease being transferred to the buyer. The City recently received a request for consent to the assignment of the Parking Lease from 100 Wilshire Associates to its buyer, Douglas Emmett Realty Fund, a California Limited Partnership. Section 2.05 of the Parking Lease provides that Lessee may assign all or any part of its rights under the Parking Lease subject to first obtaining the written consent of the City. Section 2.06 of the Parking Lease provides that the City will act promptly and reasonably and that its approval or consent will not be unreasonably withheld or delayed.

There appears to be no reason for the City Council to decline approval of the proposed assignment to Douglas Emmett Realty Fund. 100 Wilshire Associates will remain responsible for all obligations arising prior to the date of sale and conveyance of the 100 and 120-130 Wilshire real property parcels to Douglas Emmett Realty Fund. Douglas Emmett Realty will assume responsibility for all obligations arising under the Parking Lease from and after the date of sale and conveyance of the 100 and 120-130 Wilshire real property parcels.

Budget/Financial Impact

There is no budget or financial impact anticipated by the proposed assignment.

Recommendation

City staff respectfully recommends that the City Council and the Parking Authority take the following actions:

1. Adopt the accompanying City Council resolution which approves the assignment of the Parking Lease from 100 Wilshire Associates to Douglas Emmett Realty Fund and authorizes the City Manager to execute a Consent to Assignment.

2. Adopt the accompanying Parking Authority resolution which approves the assignment of the Parking Lease from 100 Wilshire Associates to Douglas Emmett Realty Fund and authorizes the Parking Authority's Executive Secretary to execute a Consent to Assignment.

Prepared By: Joseph Lawrence, Acting City Attorney

Linda A. Moxon, Deputy City Attorney

Attachments:

(1) City Council Resolution Approving Assignment

(2) Parking Authority Resolution Approving Assignment