TITLE
Recommendation to authorize City Manager, or designee, to execute all documents necessary for the Third Amendment to Lease No. 34124 between the City of Long Beach (Landlord) and Socal Holding, LLC, a Delaware limited liability company (Tenant), for the continued use of City-owned Oil Set Aside property in the Port of Long Beach in the City of Los Angeles.
DISCUSSION
On December 15, 2014, the City entered into Lease No. 34124 (Lease) with Socal Holding, LLC (Socal Holding), for a City-owned one-acre parcel under the purview of the Department of Gas and Oil located in the City of Los Angeles near Oil Area 31A (Exhibit A). The site is being used by Socal Holding for the storage of an oil rig and ancillary equipment. The site was originally leased under the City’s short-term occupancy program, as Socal Holding anticipated quick utilization of the equipment. Due to a sustained decrease in oil prices, Socal Holding found need for extended storage of its equipment.
On June 23, 2015, also under the short-term occupancy program, the City executed the First Amendment to the Lease to extend the term to December 15, 2015. On March 1, 2016, the City Council authorized the execution of the Second Amendment to the Lease to further extend the term of the Lease through December 14, 2017. Socal Holding remains on the property under the terms of the Lease on a month-to-month holdover. The Long Beach Gas and Oil Department is amenable to the continued leasing of this property. Further City Council approval is necessary to modify the Lease.
The proposed Third Amendment to Lease No. 34124 has been negotiated and will contain the following major terms and provisions:
· Term: The Lease shall be extended for an additional two-year period and shall terminate on December 31, 2019.
· Right to Terminate: Either Landlord or Tenant shall have the right to terminate the Lease at any time by providing a minimum of one month prior written notification to the other party.
· Rent: Eff...
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