HomeMy WebLinkAbout8/2/2000 - STAFF REPORTS (38) DATE: August 2, 2000
TO: City Council
FROM: Assistant Director of Aviation via Director of Aviation
AIRPORT PARK PLAZA ASSIGNMENTS AND AMENDMENTS
RECOMMENDATION:
It is recommended that the City Council approve term extensions totaling 18 years for
three separate leases comprising the Airport Park Plaza, and assignment of the leases
to AP-Palm Springs Airport LLC, conditional upon AP-Palm Springs Airport LLC
receiving all necessary use permits and agreeing upon an assignment in a form
approved by the City Attorney.
BACKGROUND:
The Airport Park Plaza lease agreements Nos. 2529, 2528 and 2636 between the City of
Palm Springs (City) and Helen Apostle, Trustee of the Apostle Family Trust (tenant), are
being considered for assignment to AP-Palm Springs Airport LLC (assignee). Each
lease pertains to a separate parcel upon the property located at 255, 265 and 275 N. El
Cielo, Palm Springs, which encompass the Airport Park Plaza. As a wholly owned entity
of The Abbey Company, 12383 Lewis Street #200, Garden Grove, CA 92840-4643, AP-
Palm Springs Airport LLC is planning on buying the leasehold estate from the present
tenant. Company officials representing AP-Palm Springs Airport LLC have indicated that
the closing date for this anticipated change in ownership is expected to occur on July 31,
2000.
Staff has had limited time to review this proposal and will continue to work with the City
Attorney on finalizing all terms and provisions of the lease assignment. The Airport
Commission has received limited information regarding this request and is in favor in
moving forward with negotiations. We have been informed that The Abbey Company is
an Orange County based real estate company and controls a portfolio comprised of 42
retail, office and industrial developments which total circa 3 million square feet and has a
market value of circa $275,000,000. In conjunction with Airport staff, the Director of
Finance & Treasury has reviewed the companies consolidated balance sheet, including
Profit & Loss statements. The Abbey Center, a 3-building, 72,000 s.f. office investment
at the corner of Ramon Road and Farrell Drive, opposite the high school, is one of their
assets in Palm Springs.
Staff has discussed certain lease provisions that will be incorporated in the amendment
for the Airport Park Plaza with Mr. Robert C. LeMoine, Executive Vice President of The
Abbey Company. Additionally, in the closed session meeting of July 26, 2000 general
parameters of the assignments/amendments were discussed. Specific terms of the
agreement are as follows:
1. Term: assignee agrees that the term of the separate leases, currently scheduled to
terminate in the year 2037/2038 respectively, shall remain the same with two lease
option extensions (1) 10 year extension and (1) 8 year extension.
2. Exchange Offer: assignee has tentatively agreed to pay to the City $275,000 in
exchange for the assignment of the amended lease, including the term extensions.
Airport Park Plaza
August 2, 2000
Page 2
3. Improvement: assumption of the leases by assignee shall be conditional and
become effective upon assignee receiving all necessary use permits from the
Planning Department, Planning Commission or City Council, and in a form
approved by the City Attorney.
4. Default: assignee's lender provisions to be incorporated in the lease assignments in
a form approved by the City Attorney.
5. CPI Adjustment: Assignee agrees to a minimum of 3% per annum or CPI
adjustment, whichever is greater, with a 25% cap for a 5 year period.
Staff recommends the City Council approval of the term extensions of the three leases,
and lease assignments to assignee conditional upon assignee receiving all necessary
use permits and a positive review as to form of the assignments by the City Attorney.
APPROVED: ,
RR R1� H lac RI /
Assis ant Director of Aviation Dire for of Aviation
APPROVI��
DAVID READY =T�f'
City Manager
Attachments: (1) Minute Order
REYIE��I-IE BY KK OF RWCE
MINUTE ORDER NO.
APPROVING TERM EXTENSIONS
TOTALING 18 YEARS FOR THREE
SEPARATE LEASES COMPRISING THE
AIRPORT PARK PLAZA, AND
ASSIGNMENT OF THE LEASES TO AP-
PALM SPRINGS AIRPORT LLC,
CONDITIONAL UPON AP-PALM SPRINGS
AIRPORT LLC RECEIVING ALL
NECESSARY USE PERMITS AND
AGREEING UPON AN ASSIGNMENT IN A
FORM APPROVED BY THE CITY
ATTORNEY.
I HEREBY CERTIFY that this Minute Order approving term extensions
totaling 18 years for three separate leases comprising the Airport Park
Plaza, and Assignment of the leases to AP-Palm Springs Airport LLC,
conditional upon AP-Palm Springs Airport LLC receiving all necessary
use permits and agreeing upon an assignment in a form approved by the
City Attorney; was adopted by the City Council of the City of Palm
Springs, California in a meeting thereof held on the 2nd day of August,
2000.
PATRICIA A. SANDERS
City Clerk
MINUTE ORDER NO. 6692
APPROVING ASSIGNMENT OF THE
AIRPORT PARK PLAZA LEASES FROM
THE APOSTLE FAMILY TRUST TO AP-
PALM SPRINGS AIRPORT LLC,
CONDITIONAL UPON AP-PALM
SPRINGS AIRPORT LLC RECEIVING ALL
NECESSARY USE PERMITS, IN A FORM
APPROVED BY THE CITY ATTORNEY.
------------------
I HEREBY CERTIFY that this Minute Order, approving Assignment of the Airport
Park Plaza leases from the Apostle Family Trust to AP-Palm Springs Airport LLC,
conditional upon AP-Palm Springs Airport LLC receiving all necessary use
permits, in a form approved by the City Attorney, was adopted by the City
Council of the City of Palm Springs, California, in a meeting thereof held on the
2nd day of August, 2000.
PATRICIA A. SANDERS
City Clerk
�5
t.,
MINUTE ORDER NO. 6693
APPROVING TERM EXTENSIONS
TOTALING 18 YEARS FOR THREE
SEPARATE LEASES COMPRISING THE
AIRPORT PARK PLAZA: AGREEMENTS
2528, 2529 AND 2626.
------------------
I HEREBY CERTIFY that this Minute Order, approving term extensions totaling
18 years for three separate leases comprising the Airport Park Plaza: agreements
2528, 2529 and 2626, was adopted by the City Council of the City of Palm
Springs, California, in a meeting thereof held on the 2Id day of August, 2000.
PATRICIA A. SANDERS
City Clerk
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