TITLE
Recommendation to authorize City Manager to execute all documents necessary for a new lease with Cinema Aircraft Executive Transportation, LLC, a Delaware limited liability company, for the continued lease of City-owned property at 4301 Donald Douglas Drive at the Long Beach Airport. (District 5)
DISCUSSION
In November 1987, the City Council authorized the execution of Lease No. 20064 for a 25-year term with Long Beach Aviation Building (LBAB) for the construction of 48 condominium hangars and a flight school. In May 1994, the City Council authorized the First Amendment to provide for an option to extend the term for an additional 15-year period. In July 1999, the City Council authorized the Second Amendment to increase the leased premises with an additional 0.55-acre parcel.
In October 2005, LBAB executed a sublease with Cinema Aircraft Executive Transportation (Cinema) for Parcels 2 and 3 of the leased premises (Attachment), which included an option to purchase LBAB’s leasehold interest in Parcels 2 and 3. In December 2006, Cinema exercised its option, an Assignment of Lease was executed and recorded between the parties, and Lease No. 20064 was subdivided, thus creating two leases with the same terms and conditions; Lease No. 20064 for Parcel 1 with LBAB and a separate lease for Parcels 2 and 3 for Cinema.
The initial term of the leases expired on December 31, 2012. Under the provisions of the leases, LBAB and Cinema were required to notify the City in writing of their intent to exercise their respective options to extend the terms of the leases for an additional fifteen-year period through December 31, 2027. LBAB exercised their option, but no notification was received from Cinema. As a result, Cinema's lease converted to a month-to-month agreement on January 1, 2013. Thereafter, Cinema has remained a tenant in good standing, has paid its monthly rent on time and has continued to provide a modernized hangar on the Airport campus.
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