TITLE
Recommendation to authorize City Manager, or designee, to execute all documents necessary for a Second Amendment to Lease No. 34894 with BLANKSPACES, LLC, for City-owned property located at 309 Pine Avenue, commonly known as the Shaun Lumachi Innovation Center. (District 1)
Levine Act: Yes
DISCUSSION
On December 5, 2017, the City Council approved Lease No. 34894 (Lease) with BLANKSPACES, LLC (Lessee) for City-owned property located at 309 Pine Avenue, commonly known as the Shaun Lumachi Innovation Center (Subject Property). The Subject Property required substantial capital improvements to make the facility functional and code compliant, including elevator recommission, bathroom improvements, ADA access upgrades, and interior redesign of the space to support co-working activities and entrepreneurial community events. On February 8, 2022, City Council approved a First Amendment to the Lease to compensate the Lessee for documented financial losses, as well as adjust the Rent Commencement Date to July 1, 2023, due to delays from COVID-19 related closures and resulting supply chain challenges. The Shaun Lumachi Innovation Center celebrated its grand opening on May 13, 2022.
Due to recent heavy winter storms, the Subject Property experienced roof damage and resulting leaks which affected the interior of the building. In addition, a leak in the sewage drainage system was discovered requiring significant repair and renovation to the restrooms. The time required to complete the required remediation and repairs from both issues have spanned approximately six months causing the Lessee further economic losses due to the disruptions to its customers. Rent, currently due and payable as of July 1, 2023, is $9,400 per month, less any available rent credits to offset Lessees management fee and certain operating costs. The total rents credits cannot exceed $4,600 per month, resulting in a minimum monthly rent of no less than $4,800. The Lessee has requested to ex...
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