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20080603 CC SR Extension to Lease Agreement with New Cingular Wireless kAl MEMORANDUM RANCHO PALOS VERDES TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: CAROLYNN PETRU, DEPUTY CITY MANAGER DATE: JUNE 3, 2008 SUBJECT: EXTENSION TO LEASE AGREEMENT WITH NEW CINGULAR WIRELESS ASSOCIATED WITH THE MONOPOLE AT CITY HALL REVIEWED: CAROLYN LEHR, CITY MANAGER RECOMMENDATION Approve the First Amendment to the Lease Agreement with New Cingular Wireless PCS, LLC to extend the term of the agreement to June 30, 2009. DISCUSSION Verizon Wireless owns the telecommunications monopole located at City Hall. The company had an initial 20-year lease with the City for the area where the pole is located, as well as support equipment space inside City Hall, which was scheduled to expire on February 28, 2008. On February 19, 2008, Council approved an amendment to the Lease Agreement with Verizon Wireless to extend the term of the agreement to June 30, 2009. At that same meeting, staff also informed Council that the ground lease with New Cingular Wireless (previously known as LA Cellular and AT&T Wireless), which was allowed to co-locate on the monopole in 1988, was scheduled to expire on August 31, 2008. Council directed staff to bring back an amendment to the Lease Agreement with New Cingular Wireless prior to August 31, 2008 to extend the term of the agreement to June 30, 2009. As Council will recall, Edison also has communications facilities on the monopole and its building lease with the City is due to expire on June 30, 2009, but can be extended once more to June 30, 2014 Staff is now presenting a Lease Amendment with New Cingular Wireless for Council's consideration that is consistent with this prior direction to extend the current agreement to June 30, 2009. However, staff has recently been in contact with Coastal Business Group, Inc. a third party consultant representing New Cingular Wireless, regarding the lease extension. Coastal Business Group has submitted a proposal to enter into a new lease agreement with the City with an initial 10-year tern with two renewable terms of 5 years each, for a total term of 20 years (ending in 2028). Staff does not recommend entering into a new agreement with an expiration date that is beyond June 30, 2009, as the shorter term makes all of the existing lease agreements consistent with one another; will allow the affected parties time to meet and confer; and allows staff time to analyze 11 -1 Extension of Lease Agreement with New Cingular Wireless June 3, 2008 Page 2 of 2 and bring back a recommendation with alternatives to City Council regarding the future of the monopole at City Hall. Attachments: First Amendment to Lease Agreement with New Cingular Wireless Proposal from Coastal Business Group dated May 20, 2008 11 -2 FIRST AMENDMENT TO LEASE AGREEMENT THIS FIRST AMENDMENT TO LEASE AGREEMENT ("Amendment") is entered into and effective as of the 3rd day of June 2008, by and between the CITY OF RANCHO PALOS VERDES ("LESSOR") and NEW CINGULAR WIRELESS PCS, LLC ("LESSEE"), formerly known as LA Cellular and AT&T Wireless, of 12900 Park Plaza Drive, 3rd Floor, Cerritos, California 90703. RECITALS A. LESSOR is the owner of that certain real property ("LESSOR'S Property) located at 30940 Hawthorne Boulevard, in the City of Rancho Palos Verdes, in the County of Los Angeles, California. B. LESSOR and LESSEE are parties to that certain Building Lease Agreement dated November 15, 1988, pursuant to which LESSEE is leasing from LESSOR a portion of LESSOR'S Property (the "Property"). Capitalized terms used herein but not otherwise defined shall have the meaning ascribed to them in the Lease. C. LESSOR and LESSEE now desire to amend the Lease on the terms and subject to the conditions of this Amendment. AGREEMENT In consideration of the foregoing recitals and the mutual representation, warranties, covenants and conditions set forth in the Lease and herein, the parties, intending to be legally bound, agree to amend the Lease as follows: 1. With respect to Article 3 ("Term and Rent") of the Lease, a new subsection D is hereby inserted to read in its entirety as follows: E. The term of the Lease is hereby extended from August 31, 2008 to June 30, 2009. 11 -3 IN WITNESS WHEREOF, the parties hereto have entered into this Amendment to Lease as of the date set forth above. LESSOR: LESSEE: CITY OF RANCHO PALOS VERDES NEW CINGULAR WIRELESS PCS, LLC By: By: Name: Douglas W. Stern Name: Title: Mayor Title: ATTEST: By: Name: Carla Morreale Title: City Clerk 11 -4 Coastal Business Group, Inc. To: Carolynn Petru, City of Rancho Palos Verdes From: Katelyn Frizelle Coastal Business Group, Inc. 30940 Hawthorne Blvd. Re: Rancho Palos Verdes, CA 90274 Lease Renewal Date: May 20, 2008 Coastal Business Group, Inc., on behalf of New Cingular Wireless PCS, LLC, is pleased to present a proposal to renew the lease of the premises referenced above under the following terms and conditions: 1. Tenant: New Cingular Wireless PCS, LLC 2. Lease Type: Building space lease 3. Size: Approximately 280 sq. ft. 4. Lease Term: An initial 10-year term with 2 renewable terms of 5 years each. (20 years total) S. Commencement Date: September 1, 2008 6. Monthly Base Rent: $2,493.35 per month; with CPI annual increases. All other terms and conditions as per Original Lease shall remain in full force and affect 7. Expiration: This proposal to lease shall expire June 3, 2008. It is expressly understood and agreed by all parties that this letter is only a summary of certain terms and conditions being discussed between the parties hereto with respect to the proposed lease of the demised premises. In no event shall this letter be considered as a binding contract enforceable against either party. All terms and conditions proposed herein subject to Lessor's review and approval of Lessee's credit and execution of a formal lease agreement. This letter is not a warranty or representation by Lessor or Lessee that acceptance of this proposal will guarantee the execution of a lease agreement of the demised premise. Thank you for your consideration. If you have any questions or require any additional information, please contact my office. Sincerely, Katelyn S. Frizelle on behalf of New Cingular Wireless PCS, LLC AGREED AND ACCEPTED 28872 Drakes Bay • Laguna Niguel, CA • 92677 Ph: 949.215.5857 Fax: 949.215.3925 11 -5 f! I I I " f - " Agency Permit Procoss AntoCAD Drafting September 01,2007 City Council i " Consulting `t Conceptual Design Construction Design Pians Re: Letter of Authorization Contract Administration To Whom It May Concern: Cost Analysis Data Base Management Coastal Business Group,Inc.and its employees and agents are authorized Engineering services representatives of BMS Communications,Inc-,and have been contracted Feasibility Studies to perform real estate leasing and land-use entitlement services for BMS Communications,Inc. HOA Meetings Joint Pole Solutions As an authorized representative of BMS Communications,Inc.,Coastal ! Lcase/Liceusc Agreements Business Group,Inc.,may sign,file,review land-use applications and permits,represent at hearings,accept conditions of approval and negotiate Maintenance Engineering leases on BMS Communications,Inc.,behalf ! j Outside Plant Engineering I] Photo Shm; If there are any questions or comments,please contact me urunediately. i Planning Couunission Sincerely, Plant Contraction Mgmt. Power&Telco Services Ci r Prof eet Administration ge Director of Site A uisition Project Management BMS Communica ns,Inc. Regulamry 805-581-6522 Reports Schedules i Structural Analysis System Design Traffic Plans i VVhlkout Services Warehousing Zoning Drawings 4133 Guardian Street a Simi Valley, CA 93063 805.526.1141 * Fax 805.526.2688 ! Website:www.bmseng.com I 11 -6 Xcing.uiar raising the barradt' c►,ts„�ar wireless 12M Park Para Drive,P Floor. Carritm,CA 90703 911!07 RE: Letter of Authorization To Whom It May Concern: BMS Communications Inc.and its employees and agents are authorized representative of Cingular Wireless and have been contracted to perform real estate Ieasing,land-use entitlements and architectural&ongirteering services for Cingular telecommunications facilities. As an authorized representative of Cingular Wireless,BMS Communications Inc., may sign,file,review land-use applications and permits, represent at hearings, accept conditions of approval, and negotiate leases on Cingalar Wireless'behalf. If there are any questions or comments,please contact me immediately. Sincerely, Emily Vaughan Ciagular Wireless Real Estate and Construction Manager 12900 Park Plaza Drive,3rd Floor Cerritos, CA 90703 en,ly-vaughan@chigulw.com cingulw.com 11 -7