TITLE
Recommendation to authorize City Manager to execute the Third Extension Agreement to Lease No. 9406 with Chevron U.S.A., Inc., to extend the term of the Lease through May 31, 2008 with a monthly base rent of $11,546, for a gasoline service station on City-owned property at 3405 N. Lakewood Boulevard. (District 5)
DISCUSSION
On February 21, 1968, the City Council approved Lease No. 9406 with Standard Oil
Company of California, for a gasoline service station on City-owned property at the
northwest comer of La kewood Boulevard and Donald Douglas Drive (see Attachment),
for a term of 25 years, with two five-year extension options. Both extension options were
exercised, which extended the term through February 20, 2003. On July 2, 2002 and
February 10, 2004, the City Council approved Extension Agreements to extend the term
of the Lease through February 20, 2006. Chevron U.S.A., Inc. (Chevron) is successor
in interest to Standard Oil Company. Chevron is currently operating on a month-tomonth
basis and has requested an extension of the term of the Lease through
May 31,2008.
The proposed Third Extension Agreement to Lease No. 9406 contains the following
major provisions:
The term of the tease shall be extended through May 31,2008.
Effective June 1, 2006, the monthly base rent shall increase from $5,302 to
$1 1,546, as determined by appraisal for current fair market value.
All remaining terms and conditions shall remain in full force and effect.
This letter was reviewed by Deputy City Attorney Richard F. Anthony on June 7, 2006
and Budget Management Officer David Wodynski on May 30,2006.
TIMING CONSIDERATIONS
City Council action is requested on June 20, 2006, in an effort to formalize an
agreement for the lease extension.
FISCAL IMPACT
Annual revenue in the amount of $138,552 will accrue to the Airport Fund (EF 320) in
the Department of Public Works (PW). There is no impact to the General Fund.
SUGGESTED ACTION
Approve recommendation.
Respectfully...
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