Item 6-C

Council Meeting: November 9, 1999 Santa Monica, California

 

 

TO: Mayor and City Council

FROM: City Staff

SUBJECT: Recommendation to Authorize the City Manager to Negotiate and Execute a Five-Year Lease Extension Option with Santa Monica HSR Limited Partnership for the Finance Department and Risk Management Division Office Space

 

Introduction

This report recommends that the City Council authorize the City Manager to negotiate and execute a five-year office space lease extension at 1717 4th Street with Santa Monica HSR Limited Partnership for the Finance Department and Risk Management Division.

Background

The Administration and Financial Operations Divisions of the Finance Department and the Risk Management Division of the City Manager=s Office are located in leased office space at 1717 4th Street. The Treasury Division is located at City Hall. The current office space lease expires March 1, 2000, but contains the option to extend for a period of five years. After comparing rental rates and parking availability at other sites, staff concluded that it would be least disruptive and most cost-effective to the City to exercise the five-year option at 1717 4th Street.

Lease Extension Agreement

The negotiated extension agreement extends the lease to March 1, 2005, and includes an option to terminate the agreement by October 31, 2003, so that staff could relocate to City Hall upon completion of the new Public Safety Facility and remodeling of the City Hall space now occupied by the Police Department. All other material terms and conditions of the lease remain essentially unchanged.

Budget/Financial Impact

The current lease cost, in effect since 1995, is $1.85/sq. foot/month. The lease, to be effective March 1, 2000, will be $2.48/sq. foot/month. The total lease cost for FY 1999-00 is $159,048.48. Funds budgeted at account numbers 01221.522620 and 59206.522620 and savings in other Finance Department and Risk Management Division accounts are sufficient to pay the new lease cost for FY1999-2000.

Recommendation

It is recommended that the City Council authorize the City Manager to negotiate and execute a five-year office space lease extension with Santa Monica HSR Limited Partnership for Finance Department and Risk Management Division office space.

Prepared by: Mike Dennis, Director of Finance