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HomeMy WebLinkAbout2007 CON CDC Frank Motors - Lease Agreement Old RCP SiteLEASE AGREEMENT by and between the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY and FRANK MOTORS, INC This Lease, made and entered into this 5th day of June 2007 by and between the Community Development Commission of the City of National City ("CDC"), hereinafter designated as "Lessor," and Frank Motors Inc., hereinafter designated as "Lessee." RECITALS A. Lessec is desirous of leasing from Lessor, and Lessor is desirous of leasing to Lessee, certain real property referred to as the former "RCP Site" on National City Boulevard (APN# 562- 321-08) for Vehicle Storage purposes in National City, California. Vehicle Storage is herein described as Lessee's exclusive use of approximately 58,370-sf of land area, as described in attached Exhibit "A" and as shown as Exhibit `B", which exhibits are incorporated herein by reference. B. The use of said property for the above referenced purpose shall promote the general public welfare of the City of National City. NOW, THEREFORE, the parties hereto agree as follows: 1. LEGAL STATUS OF OPERATOR: Operator warrants that it is a legal corporation, incorporated under the laws of the State of California. 2. Leased Premises. Lessor does hereby lease, demise and let to Lessee the real property commonly described as the former "RCP Site" on National City Boulevard (APN# 562-321- 08) within the City of National City, County of San Diego, State of California. 3. Term. The term of this lease shall be month -to -month beginning on the executed date of this lease. Lessee acknowledges that the use of the site is temporary and agrees to diligently seek an alternative means for vehicle storage once the CDC exercises its right to terminate said lease. ssee's Initial 2 1 Date Page 1 of 6 4. Rent. Lessee shall pay Lessor fair market rent in the amount of Six Thousand Three Hundred Thirty Four Dollars ($6,334) per month for approximately 58,370-sf of land arca. The fair market rent was established by an independent appraisal that was performed by Randall H. Blaesi, ASA. Rent for the leased premises shall be payable on the 1s` of each month commencing on the executed date of said Lease. 5. Mailings & Noticing: All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested, or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile, fax or e-mail; and shall deemed received upon the earlier (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility (iii) if mailed by registered, certified, or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile, fax or e-mail, when sent. Any payment, notice, request, demand, direction, or other communication delivered or sent as specified above shall be directed to the following persons: To the Lessor: To the Lessee: Brad Raulston, Executive Director Community Development Commission of National City 1243 National City Boulevard National City, CA 91950-4397 Frank Motors, Inc. Attn: James Fornaca, President 2400 National City Boulevard National City, CA 91950 6. Use. The subject property shall be leased to Lessee by Lessor for vehicle storage. 7. Assignment. This Lease shall not be assigned, hypothecated, leveraged, or transferred without the consent in writing of the CDC, evidenced by a resolution hereof duly adopted for said purpose. 8. Improvements. Lessee shall maintain all improvements in conformance with the laws of the State of California and the ordinances of the City of National City, in connection therewith and in the operation and maintenance thereof. 9. Repair. Lessor shall not be liable for the repair or upkeep and/or maintenance of any improvements located or to be located on the leased premises. Lessee shall be responsible for all maintenance and repair, and the costs of all utilities on the leased premises. Lessee shall keep the leased premises in as good order, condition and repair as reasonable use and wear thereof will permit. Lessor shall cause the landscaped areas to be cared for, trimmed, Page 2 of 6 mowed, and weeded as necessary to maintain an attractive property. 10. Hold Harmless. Lessee hereby agrees to indemnify, defend, and hold harmless the Community Development Commission of the City of National City, the City of National City and their officers and employees from all liability, loss, costs, claims, demands, suits, and defense costs arising out of the use and maintenance of the leased premises and the improvements thereon by Lessee or any sub -lessee. 11. Insurance. Lessee shall take out and maintain, throughout the period of this Lease, comprehensive general liability insurance with minimum limits of One Million Dollars ($1,000,000.00) combined single limit per occurrence, covering all bodily injury and property damage arising out of this Lease. Lessee shall also provide evidence of the following insurancc coverage, which must be maintained throughout the period of this lease, if not included on the CGL policy or other garage policy: a. Commercial auto liability insurance with combined single limits of at least One Million Dollars ($1,000,000) per accident; and b. Garage keepers coverage/garage keepers legal liability coverage with limits of at least One Million Dollars ($1,000,000) per occurrence; and c. Workers' compensation coverage for all employees subject to this requirement sufficient to satisfy California statutory provisions. With the exception of the workers' compensation coverage, these policies shall name Lessor, the Community Development Commission of the City of National City, the City of National City, and their officers, agents, and employees as additional insured, and shall constitute primary insurance as to Lessor, its officers, agents and employees, so that any other policies held by Lessor shall not contribute to any loss under said insurancc. Said policies shall provide for thirty (30) days' prior written notice to Lessor of cancellation or material change. Prior to commencement of this Lease, Lessee shall furnish Lessor a certificate of insurance and with original endorsements affecting coverage required by this clause. The certificate and endorsements for the insurance policy are to be signed by a person authorized by that insurer to bind coverage on its behalf. The certificate and endorsements are to be received and approved by Lessor before this Agreement is signed. Lessee shall keep the improvements located on the Leased premises insured against loss or damage by fire in the amounts not less than eighty-five percent (85%) replacement value. If the required insurance coverage is provided on a "claims made" rather than "occurrence" form, Lessee shall maintain such insurance coverage for three (3) years after expiration of the term (and any extensions) of this Lease. If Lessee does not keep an insurance policy in full force and effect at all times during the term of this Lease, Lessor may elect to treat the failure to maintain the requisite insurance as a Page 3 of 6 breach of the contract and terminate this Lease forthwith. 12. Inspection. Lessor, by and through its proper officers, reserve and shall always have the right, upon reasonable notice and at a reasonable time, to enter the leased premises for the purpose of viewing and ascertaining the conditions of the same and the operation and maintenance thereof. 13. Termination. This Lease may be terminated by either party (without cause) upon ninety (90) days written notice. 14. Non -Discrimination. Lessee agrees that there shall be no discrimination against or segregation of any person or group of persons, because of race, color, creed, national origin, sex, sexual orientation; ancestry, marital status, physical handicap, or medical condition, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the leased premises, nor shall Lessee, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of tenants, lessees, subleases, subtenants, or vendees in the leased premises. 15. Waiver. The failure or omission of Lessor to terminate this Lease for any violations of any of its terms, conditions, or covenants shall in no way be deemed to be a consent by Lessor to such violation and shall in no way bar, stop or prevent Lessor from terminating this Lease thereafter, either for such or for any subsequent violation of any such term, condition or covenant. 16. Signs. Lessee agrees that no sign, advertisement, or notices shall be inscribed, painted or affixed on or to any part or portion of the outside of the leased premises except to be of such type and color, size and style, and in such place as may be approved by the CDC. Lessee also agrees to pay for and obtain all required regulatory approves (permit) for any signage deemed necessary for the property. 17. Taxes. Lessee recognizes and understands that this Lease may create a possessory interest subject to property taxation and that Lessee may be subject to the payment of property taxes levied on such interest. Lessee further agrees to pay all property taxes, if any, assessed during the term of this Lease pursuant to Sections 107 and 107.1 of the Revenue and Taxation Code against Lessee's possessory interest in the leased premises. 18. Waiver of Relocation Assistance. In consideration for the execution of this lease by Lessor, Lessee hereby waives any claim for relocation assistance benefits to which it may otherwise be entitled under federal, state, or local law or regulations, upon vacation of the premises. 19. Termination by Lessor. Notwithstanding any other provision of this Lease to the contrary, Lessor may terminate the Lease upon ninety (90) days written notice to Lessee in the event Lessor determines the leased parking premises are uniquely suited for public, municipal or redevelopment purposes. In the event of such a termination Lessor agrees to work with Lessee to seek reasonable alternative parking arrangements for the Project, and Lessee shall Page 4 of 6 limit all of its claims for damages against Lessor to require Lessor's good faith assistance in relocating the parking for the Project. The burden of securing adequate parking for the Project, in any case, is on Lessee. 20. Environmental Compliance. Lessee shall not engage in, nor shall it permit any third party to engage in, activities upon the Premises, or any portion thereof, for the purpose of or anyway involving the handling, manufacturing, treatment, storage, use, transportation, spillage, leakage, dumping, discharge or disposal (whether legal or illegal, accidental or intentional) or any hazardous or toxic substances, materials or wastes, or any wastes regulated under any local, state or federal law. Lessee shall be, and remain for the term of this License, in full compliance with all applicable laws governing the use and occupancy of the Premises including, without limitation, the handling, manufacturing, treatment, storage, disposal, discharge, use, and transportation of hazardous or toxic substances, materials or wastes, and any wastes regulated under any local, state or federal law (hereinafter collectively referred to as "Standards"). Lessee shall not create nor permit to be created nor permit to exist upon the Premises any non-compliance with Standards or any condition which could be alleged to create a nuisance, public, private or mixed, or to otherwise present a threat to health or property by any unhealthful, hazardous or dangerous condition (herein collectively referred to as "Harmful Conditions"). Lessee shall contain any Harmful Condition to prevent it from deteriorating. Lease shall notify Lessor immediately of any Harmful Condition or non- compliance with any Standard and Lessee shall notify all responsible local, state, or federal agencies as required by local, state or federal regulations. In the event Lessee fails to be in full compliance with the obligations assumed by Lessee herein and Lessee does not correct such non-compliance within three (3) days of written notice of such failure given by Lessor, Lessor may, but shall not be obligated to, take whatever action is necessary to bring the Premises into compliance. If however, Lessee has bcgun compliance within the allowed three (3) days of written notice, but such compliance cannot be accomplished with the allowed time frame, Lessor shall not interfere with Lessee's good faith efforts. If compliance has not been accomplished within fifteen (15) days, Lessor may, but shall not be obligated to, take whatever action is necessary. Lessee shall reimburse Lessor for all costs (including, but not limited to, consulting, engineering, clean up, containment, disposal, and legal costs) incurred by Lessor as a result of Lessee's failure to comply with the foregoing obligations assumed by Lessee, and also such costs as may be incurred by Lessor in abating or protecting against Harmful Conditions and/or a violation of Standards. Lessee shall indemnify, defend and hold Lessor, its employees and agents, harmless from and against any claim or lawsuit, local, state or federal enforcement action, or civil or criminal claims, which arise from or relate to any actual or alleged Harmful Conditions, actual or alleged violation of Standards, or actual or alleged injuries to or death of any Page 5 of 6 persons and loss of or damages to property, including without limitation, employees and property of Lessor and Lessee, which arise during Lessee's presence on, or negligent use of, Premises. Lessee expressly agrees that the indemnification, and hold harmless obligations assumed by Lessee with regard to abatement of Harmful Conditions and violations of Standards in this Article, shall survive expiration or termination of this Lease. 21. Obstruction. Except as permitted by this Lease, Lessee shall not place, install, maintain, or allow any combustible materials, buildings, structures, or other improvements upon the Licensed Premises and shall not cause or allow the surface elevation therein to be changed in any way whatsoever, without Lessor prior written approval. IN WITNESS WHEREOF, this Lease is executed by the Community Development Commission of the City of National City, pursuant to resolution authorizing the Chairman to execute the same for and on behalf of said CDC, and Frank Toyota, Inc., has caused this instrument to be executed by its proper representatives thereon to duly authorized. Community Development Commission Of the City of National City on Morrison, Chairman APPROVED AS TO FORM: By: / f'J a Frank Motors, Incorporated By George Eiser, III, CDC Attorney GT Fenell , Ge eral Manager Page 6 of 6 File No: 05720141 EXHIBIT "A" All that certain real property situated in the County of San Diego, State of California, described as follows: Parcel 2 of Parcel Map No. 16651, in the City of National City, County of San Diego, State of California, filed in the Office of the County Recorder of San Diego County on October 2, 1991 as File No. 91-051683 of Official Records. • .V72 / 27'E i23.5% KEYSTONE TR' SEE S• 08 1.34AC PM16651 PAR 2 ee BOY." NY1y$:39 `'' CITY ti ` Yt, ,.-1.J. 4cto WSJ, lf4 1,- I1 .� w Y J. Yi•20'Ji`l..iL ' 1 dye, 2e PM 16657. Y w PARK ^1- Nu *h 0.1 3.37AC •,�? PAR t it ij z 224.15 OF OF 3 32N6 - ST. N. 72 ' !G' 27'E G 23. 3f ASP ai h >u QSEC 151K ga P. 6z lia 2 10.9IAC *AI.• • a..* e.1110..7037f"L OP. HW OP. rtl Acr ACORD CERTIFICATE OF LIABILITY INSURANCE PRODUCER Murria & Frick Insurance 380 Stevens Ave., First Floor Solana Beach CA 92075 Phone:858-259-5800 Fax:858-259-6069 INSURED Frank Motors, Inc. Frank Motors Toyota Frank Motors Hyundai 2400 National City Blvd. National City CA 91950 FRANK -el 10/04/06 DATE (MMIDD/YYYY) THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. INSURER C INSURER D. INSURER E: INSURERS AFFORDING COVERAGE INSURER A INSURERS Zenith Insurance Federal Insurance Company Underwriters at Lloyds I NAIC # Now Hampshire Insurance Co. COVERAGES THE POI.ICIES OF INSURANCE LISTED BFI OW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT. TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN. THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE I ERMS, EXCLUSIONS AND CONDITIONS 01- SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED RY PAID CLAIMS. IRSR'IIDD� I POLICYEFFEO M.1P�LICYEXPINATION I LTR INSRU TYPE OF INSURANCE POLICY NUMBER ; DATE (MM/DD/YY) DATE (MM/DD/YY) - LIMITS X GENERAL LIABILITY I I I EACH OCCURRENCE $ U I I COMMERCIAL GENERAL LIABILITY .PPR MISES (EaToccurence) E <—T • CLAIMS MADE I j OCCUR I I MEU EXP (Any one person) I $ PERSONAL & ADV INJURY 15 _ . GENERAL AGGREGA IE I $ I � _ I GENT AGGREjGATE LIMIT APPLIES PER. I PRODUCTS - COMP/OP AGG 15 I' POLICY I I JE j I LOC I I I A 1 •X I AUTOMOBILE LIABILITY I I COMBINED SINGLE LIMIT ANY AUTO 01LX06553151 09/30/06 09/30/07 (Eaac4dent) 151,000,000 I ALL OWNED AUTOS I BODILY INJURY (Per person) 5 X (SCHEDULED AUTOS I I I IXiHIRED AUTOS 1 SODA YINJURY I$ J NON-OWNFO AUTOS 1 (Per acodent) IX X I DOC PROPERTY DAMAGE I (Per accident) I $ I A I I I 1 GARAGE LIABILITY I AUTO ONLY - EA ACCIDENT 51000000 ANY AUTO 01LX06553151 1 09/30/06 1 09/30/07 I OIHERTHAN EAACC 1$! 5 1000000 - �-I AUTO ONLY- AGG 15 3000000 i I C IX I I XCESS/UMBRELLAA LIABILITY EACH OCCURRENCE , $ 9 000,000 k O`CCUR I CLAIMSMADE 79423850 09/30/06 09/30/07 I AGGREGATE $9, 000, 000 _ -- IS _ I DEDUCTIBLE i I 15 ��I I REIENI ION $ I --- _-- I 5 WORKERS EMPLOYERS' B IANYPROVRIETORIPARTNER!EXECUTNE OFFICER/MEMBER BFC COMPENSATION AND X WC SIAIU IDIH•I � ITORY LIMITS ER LIABILITY Z066121903 07/01/06 07/01/07 IE_L.EACH ACCIDENT '51,000,000 EXCLUDED' E.L. DISLASE - EA EMPLOYEE $ 1,000,000 IdAeLsPcfOnSOrNS below F- IE L. DISEASE - POLICY LIMIT 15 1 , 000 , 000 OTHER I D Auto Physical Dmg jADPD0117/06 09/30/06 09/30/07! D (Auto PD Excess ADPD0117/06XS 09/30/06 09/30/071 DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES / EXCLUSIONS ADDED BY ENDORSEMENT / SPECIAL PROVISIONS * 10 days for non-payment of premium. Community Development Commission of the City of National City, the City of National City, and their officers, agents, and employees are listed as additional insureds. Re: 720 West 23rd Street, National City, CA. CERTIFICATE HOLDER CANCELLATION COMMUNI Community Development Commission of National City 1243 National City Blvd National City CA 91950-4397 SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING INSURER WILL ENDEAVOR TO MAIL 30 * DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHALL IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER, ITS AGENTS OR REPRESENTATNES. AUj.419f2ED 1$ RE9 ACORD 25 (2001/08) ©ACORD CORPORATION 1988 RESOLUTION NO. 2007 — 121 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY AUTHORIZING THE CHAIRMAN TO EXECUTE A LEASE AGREEMENT BETWEEN FRANK MOTORS, INC. AND THE COMMUNITY DEVELOPMENT COMMISSION FOR VEHICLE STORAGE PURPOSES ON AN APPROXIMATELY 1.34-ACRE PARCEL (APN# 562-321-08) KNOWN AS THE FORMER "RCP SITE" LOCATED JUST SOUTH OF THE KEYSTONE TRAILER PARK ON NATIONAL CITY BOULEVARD WHEREAS, Frank Motors and the Community Development Commission of the City of National City (CDC) desire to enter into a Lease Agreement ("Agreement") for an approximately 1.34-acre parcel (APN# 562-321-08) known as the former RCP Site (APN# 562- 321-08) located just south of the Keystone Trailer Park on National City Boulevard for vehicle storage purposes along the Mile of Cars in National City; and WHEREAS, the Lease Agreement will accommodate a larger inventory of vehicles for Frank Motors, which may result in increased sales volume and sales tax revenues to the City; and WHEREAS, the term of the Lease Agreement shall be month to month beginning on the executed date of said Agreement; and WHEREAS, Frank Motors shall pay the CDC fair market rent (FMR), which was established by an independent appraisal, in the amount of $6,334 per month for the approximately 1.34-acre parcel. NOW, THEREFORE, BE IT RESOLVED, that the Community Development Commission of the City of National City hereby authorizes the Chairman to execute a Lease Agreement with Frank Motors, Incorporated for an approximately 1.34-acre parcel (APN# 562- 321-08) known as the former RCP Site (APN# 562-321-08) located just south of the Keystone Trailer Park on National City Boulevard for vehicle storage purposes along the Mile of Cars in National City. Said Lease Agreement is on file in the office of the City Clerk. PASSED and ADOPTED this 5th day of June, 200 on Morrison, Chairman ATTEST: Bra 6..Bau�3t6r , Secretary APPROVED AS TO FORM: George H."Eiser, III Legal Counsel Passed and adopted by the Community Development Commission of the City of National City, California, on June 5, 2007, by the following vote, to -wit: Ayes: Commissioners Natividad, Parra, Ungab, Zarate. Nays: None. Absent: Commissioner Morrison. Abstain: None. AUTHENTICATED BY: RON MORRISON Chairman, Community Development Commission Secretary, i y evelopment Commission By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2007-121 of the Community Development Commission of the City of National City, Califomia, passed and adopted on June 5, 2007. Secretary, Community Development Commission By: Deputy C7.4,OQ9' �K City of National City, California COMMUNITY DEVELOPMENT COMMISSION AGENDA STATEMENT MEETING DATE June 5 2007 AGENDA ITEM NO. 29 ITEM TITLE Resolution approving a month to month Lease Agreement between Frank Motors, Incorporated and the Community Development Commission (CDC) of National City for vehicle storage purposes on an approximately 1.34-acre parcel (APN# 562-321-08) known as the former "RCP site" located just south of the Keystone Trailer Park along National City Boulevard in National City, CA, and authorizing the Chairman to execute said Agreement. PREPARED BY DEPARTMENT Xavier Del Valle Senior Project Manager EXPLANATION Frank Motors and the CDC desire to enter into a Lease Agreement for the former "RCP Site" (APN# 562-321-08) for vehicle storage purposes along the Mile of Cars in National City. The proposed Lease would accommodate a larger inventory of vehicles for Frank Motors, which would enable them to remain competitive regionally. Additionally, the proposed Lease may lead to increased sales tax revenues to the City as a result of facilitating a larger inventory of vehicles for a local auto dealership. Community Development Commission The term of the proposed Lease shall be month to month (short tern) beginning on the executed date of the Lease. Frank Motors would pay the CDC fair market rent in the amount of $6,334 per month for approximately 58,370-sf of land area. The fair market rent was established by an independent appraisal that was performed by Randall H. Blacsi, ASA. Lease proceeds shall he deposited into the project area fund for revitalization activities. Environmental Review The proposed Lease Agreement is exempt from CEQA review. Financial Statement Frank Motors would pay the CDC fair market rent in the amount of $6,334 per month for approximately 58,370-sf of land area. Lease proceeds shall be deposited into the project arca fund for revitalization activities. Additionally, the proposed Lease may lead to increased sales tax revenues to the City as a result of facilitating a larger inventory of vehicles for a local auto dealership. STAFF RECOMMENDATION Adopt resolution approving a month to month Lease Agreement between Frank Motors, Incorporated and the Community Development Commission (CDC) of National City for vehicle storage purposes on an approximately 1.34-acre parcel (APN# 562-321-08) known as the former "RCP site" located just south of the Keystone Trailer Park along National City Boulevard in National City, CA, and authorizing the Chairman to execute said Agreement. BOARD / COMMISSION RECOMMENDATION N/A ATTACHMENTS Resolution No. - c o *t - vA l 1. Resolution 2. Lease Agreement A-200 (9/80) City of National City Office of the City Clerk 1243 National City Boulevard, National City, CA 91950-4397 Michael R. Della, CMC - City Clerk (619) 336-4228 Fax: (619) 336-4229 July 11, 2007 Mr. James Fomaca President Frank Motors, Inc. 2400 National City Blvd. National City, CA 91950 Dear Mr. Fomaca, On June 5, 2007, Resolution No. 2007-121 was passed and adopted by the Community Development Commission of National City, authorizing execution of a lease agreement with Frank Motors, Inc. We are enclosing for your records a certified copy of the above Resolution and a fully executed original lease agreement. Michael R. Dalla, CMC City Clerk Enclosure cc: Community Development Commission ® Recycled Paper