| | | | | | | | Agenda Item - 2.f.
City of Garden Grove
INTER-DEPARTMENT MEMORANDUM
| To: | Scott C. Stiles
| From: | Lisa L. Kim
| | Dept.: | City Manager
| Dept.: | Community and Economic Development
| | Subject: | Approval to extend the Lease Agreement with the Credit Union of Southern California for property located at 11390 Stanford Avenue, Garden Grove. (Action Item)
| Date: | 11/10/2020 |
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| | | | | | | | OBJECTIVE
For the City Council to approve the Fourth Amendment to the Credit Union Lease (“Fourth Amendment”) with Credit Union of Southern California for the continued use of office space at 11390 Stanford Avenue, Garden Grove. |
| | | | | | | | BACKGROUND
Golden West Cities Federal Credit Union (“Golden West”) as the predecessor to the Credit Union of Southern California has leased the office located at 11390 Stanford Avenue owned by the City of Garden Grove (“City”), since 1979. In 2002, the City and Golden West executed an amendment (“First Amendment”) to the Lease, extending the term for an additional 15-years and for the renovation of the office building to comply with the American with Disabilities Act (ADA). In 2014, the Credit Union of Southern California (“CUSC”) and Golden West merged and the Lease was assigned to CUSC. In September 2016, Staff and CUSC negotiated another Lease extension (Second Amendment) for an additional three (3) years, with two (2) one-year options held by CUSC. In 2019, the City and CUSC executed the Third Amendment, the first of two (2) one-year options, extending the Lease through December 1, 2020, and adjusting the rent by the Consumer Price Index (“CPI”) to Five Thousand Three Hundred Ninety Dollars and 20/100 Cents ($5,390.20) per month. |
| | | | | | | | DISCUSSION
The attached Fourth Amendment extends the Lease for the second one-year option through December 1, 2021, and adjusts the rent by the CPI to Five Thousand Four Hundred Ninety Eight Dollars and 00/100 Cents ($5,498.00) per month.
The CUSC has requested for a lease extension and the City has offered two (2) additional one-year extension options. The first-year option would extend the lease through December 1, 2022, and the second-year option through December 1, 2023. Each optional year requires City Council approval, for each extension period, the monthly rental shall be adjusted by the CPI, not to exceed three percent (3%). |
| | | | | | | | FINANCIAL IMPACT
Revenues generated from the Fourth Amendment in the amount of $5,498.00 per month or $65,976.00 for the said period will be deposited into the City’s General Fund. |
| | | | | | | | RECOMMENDATION
It is recommended that the City Council:
- Approve the Fourth Amendment to the Lease Amendment with Credit Union of Southern California for continued occupancy of 11390 Stanford Avenue; and
- Authorize the City Manager to execute the Fourth Amendment and make minor modifications as needed on behalf of the City.
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