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HomeMy WebLinkAboutAgenda -11-06-2008 - 4jORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: November 6, 2008 Action Age~a Item No. ~_ SUBJECT: Lease Renewal: Sawyer Buildin DEPARTMENT: Purchasing and Central Srvcs. PUBLIC HEARING: (Y/N) No ATTACHMENT(S): INFORMATION CONTACT: Pam Jones, (919) 245-2652 Lease Letter from County Attorney (Under Separate Cover) PURPOSE: To consider approving afour-year lease renewal for the Sawyer Building to be used as offices for Child Support Enforcement through December 1, 2012 in the amount of $49,650 per year for each of the first two years of renewal and $51,801.50 for years three and four of the renewal. BACKGROUND: The County first leased the Sawyer Building in 1987. The building is occupied by the Child Support Enforcement Department.. While the County has found it fiscally advantageous to own property versus maintaining long-term leases, the 66% State reimbursement for the lease amount minimizes the County's expenditure for providing the space. That said, however, this lease is structured in a manner that will allow the office to be relocated to the Hillsborough Commons facility in 2012 should the County choose to exercise its option to purchase and further determine Hillsborough Commons is the better location for the Child Support operations. The renewal terms offered by the Landlord are summarized as follows: • The renewal period will be December 1, 2008 through November 30, 2012. • The gross annual rent will be $49,650 through November 30, 2010; and $50,801.50 per year December 1, 2010 through November 30, 2012. The County's share would be approximately $16,881/$17,273 per year. • This equates to approximately $15.03/$15.38 per square foot. • The County provides utilities and interior maintenance. • The County provides janitorial services. • The Landlord provides maintenance to all exterior items, including, but not limited to the roof. • Six parking spaces are provided for exclusive use by the County. In the interest of full disclosure, the County Attorney has provided the attached letter that declares his interest in the ownership of the leased premises. FINANCIAL IMPACT: Funding for the lease is provided in the Child Support Enforcement operational budget. RECOMMENDATION(S): The Manager recommends the Board approve afour-year lease renewal for the Sawyer Building to be used as offices for Child Support Enforcement through December 1, 2012 in the amount of $49,650 per year for each of the first two years of renewal and $51,801.50 for years three and four of the renewal; and authorize the Chair to sign on behalf of the Board. 3 NORTK CAROLINA ORANGE COUNTY LEASE This contract of lease made and entered into this day of 2008, by and between Orange County, North Carolina, hereinafter called "County," and Seisin-in-Law, a North Carolina General Partnership, having its principal place of business in Orange County, North Carolina, hereinafter called "Landlord." W I T N E S S E T H• Landlord hereby leases to County and County hereby leases from Landlord, the following described property: Sawyer Building: the property conveyed to the Landlord in the deed recorded at Book 949, Page 149 of the Orange County Registry and as the description of the property conveyed is revised by the quitclaim deeds recorded at Book 2739, Page 348 and Book 2739, Page 352, of the Orange County Registry, which property is hereinafter referred to as either "the Sawyer Building" or "the leased premises." To have and to hold the leased premises together with all privileges and appurtenances thereunto belonging, to County subject to the terms and conditions hereinafter set forth: 1. This lease shall become effective and possession of the leased premises surrendered to County commencing on December 1, I 2008 and unless sooner terminated as herein provided shall exist and continue for a term of four (4) years. 2. Rent during the four (4) year term shall be: (1} for each of the first two years of the lease term, Forty-nine Thousand Six Hundred Fifty and No/100 Dollars ($49,650.00) per year, payable in monthly installments of Four Thousand One Hundred Thirty-seven and 50/100 Dollars ($4,137.50), and (2) for each of the last two years of the lease term, Fifty-one Thousand Eight Hundred One and 50/100 Dollars {$51,801.50), payable in monthly installments of Four Thousand Three Hundred Sixteen and 79/100 Dollars ($9,316.79). Each monthly installment of rent is payable on the first day of each month during the term of this lease. 3. Notices: For the purpose of notice or demand, the respective parties shall be served by certified or registered mail, return receipt requested, addressed to County or Landlord at their respective office address, as set forth herein: To County: Orange County Department of Purchasing and Central Services Post Office Box 8181 Hillsborough, NC 27278 To Landlord: Seisin-in-Law Post Office Drawer 1529 Hillsborough, NC 27278 or at such other address as may hereafter be designated in writing by either party hereto. The time and date on which mail 2 5 is postmarked shall be the time. and date on which such communication is deemed to have been given. 4. Covenant of Title: Landlord covenants, represents and warrants that it has full right and power to execute and perform this Lease. If at any time during the term hereby demised the title of Landlord shall fail or it shall be discovered that Landlord's title does not permit Landlord to grant the term hereby demised, County's remedy, which shall be exclusive of all other remedies, shall be: 1.) annul and void this lease; and 2.) Landlord shall indemnify and hold County harmless against any claims for rents resulting from any title claim, 5. Subordination: County agrees that this lease is and shall remain subject and subordinate to and may be assigned as security for any present and all future mortgages or deeds of trust which may now or hereafter affect the leased premises and to and for all renewals, modifications, consolidations, replacements and extensions thereof. This clause shall be self- operative and no further instrument shall be necessary to effect such subordination. However, County shall execute promptly and deliver to Landlord any such certificate or certificates in writing as Landlord may request evidencing the subordination of this lease to or the assignment of this lease as additional security for such mortgage or deed of trust and County .hereby constitutes and appoints Landlord as County's attorney-in-.fact coupled with an interest to execute .any such certificate, 3 (O certificates or assignment on County's behalf in default of such execution by County. In the event the Sawyer Building or a leasehold interest in the Sawyer Building is sold pursuant to a court order in any foreclosure proceeding or is sold pursuant to a power of sale contained in any mortgage or deed of trust, County agrees to execute an attornment agreement with such purchaser not in conflict herewith at the request of such purchaser.- 6. Assignment and Sublease: County agrees not to encumber or assign this lease or sublease all or any part of the leased premises without the written consent of Landlord, which consent shall not be unreasonably withheld. Such encumbrance, assignment or sublease shall in no way relieve County from any obligations hereunder for the payment of rents or the performance of the conditions and provisions of this lease. 7. Quite Enjoyment: Landlord agrees that County, upon paying the stipulated rental and keeping and performing the agreement and covenants herein contained, shall hold and enjoy the leased premises for the term aforesaid, subject to the terms of this Lease. 8. Right of Entry: County agrees .that Landlord or its designee shall have the right to enter the leased premises during normal business hours or any other time with consent of County. 9. Insurance: Landlord shall provide fire and extended coverage insurance to the leased premises. Contents will be 4 insured by County; County shall also insure any improvements and betterments made by it to the leased premises. to the insurable value thereof. Unless the parties hereto then agree otherwise and as provided in this lease, the proceeds collected upon all such policies of insurance shall be used to repair and/or replace the leased premises, improvements or betterments so damaged or destroyed, and such repairs or replacements shall be prosecuted promptly by both Landlord and County with such insurance funds; and in the event such funds are not adequate, then the deficiency shall be made up by Landlord as to the leased premises as leased. In the event of the total destruction of the building located on the leased premises by fire or other casualty, this lease shall terminate as of the date of such destruction, unless Landlord and County both agree to have the premises rebuilt or restored, during which rebuilding and restoration period County shall be excused from the rental payment. 'In the event of partial destruction of the building on the leased premises, rendering it unsuitable for County's business, the parties shall repair and restore the building on 'the leased premises as quickly as practical and during such period of repair and restoration there shall be an abatement to County of the rental amount proportionate to the portion of the floor area of the building on the leased premises rendered unsuitable for County's business. 10. Indemnity: County agrees to indemnify Landlord and 5 S save Landlord harmless to the extent permitted by the law and to the extent provided for by policies of insurance maintained by County, against and from any and all claims by or on behalf of any person, firm or corporation arising by reason of injury to person or damage to property occurring in or on the leased premises occasioned in whole or in part by any act or omission on the part of County or an employee, agent, visitor, assign or undertenant of County or by reason of any unlawful use of the leased premises or any breach, violation or nonperformance of any covenant in this lease on the part of County to be observed or performed, and also for any matter or thing growing out of the occupancy ox use of the leased premises by County. 11. Repair and Maintenance: a.) County repairs and Maintenance: County agrees to keep the leased premises in good condition and repair, excepting repairs which are the responsibility of Landlord or which are made necessary by reason of fire and other unavoidable casualties covered by Landlord's fire and extended coverage insurance, and excepting reasonable wear and tear. Within such repair responsibilities of County shall be included: the walls and ceiling (including the painting thereof); repairs and maintenance of heating and air conditioning systems {cost not to exceed $2000 per year); normal plumbing maintenance (including stoppage but not including repair to water, drainage or sewer lines); normal minor electrical maintenance {cost not to exceed $500 per occurrence); maintenance of floor coverings. 6 b.) Landlord's Repairs and Maintenance: Landlord agrees to keep, repair and maintain the exterior of the building (including the roof, exterior walls, foundations, gutters and downspouts), sidewalks, parking area, supply pipes for gas (if any) and water, drainage and sewer pipes (excluding stoppage), repairs of air conditioning and heating systems, plumbing and electrical that exceed the above limits stipulated in County Repair and Maintenance. If any portion of, the leased premises which is the responsibility of Landlord.shall at any time be in need of repairs, Landlord will promptly repair same upon receipt of written notice from County to do so, except that Landlord shall not be obligated to make or pay for any repairs rendered necessary by the fault, act or negligence of County, or any of its agents,.employees or business invitees. 12. Alterations: Any alterations, additions, improvements or. partitions permitted herein to the leased premises shall be made at the expense of County. County agrees that County will make no alterations.; additions or improvements to the leased premises without the written consent of Landlord, which consent will not be unreasonably withheld. All alterations, additions or improvements made by and for County, including but not limited to, any and all subdividing partitions, walls, special plumbing, electrical fixtures or railings of whatever type, material or height, but excepting moveable office furniture put in at County's expense shall, when made, be the property of Landlord and shall remain upon and be surrendered with the leased 7 ~o premises as a part thereof at the expiration or earlier termination of this lease. 13. Services: County agrees to furnish the leased .premises with electrical service suitable for the intended use as general office space, including fluorescent tube and ballast replacements, that necessary for heating and air conditioning for the comfortable use and occupancy of the leased premises, janitorial and trash removal from the leased premises and to pay all charges for utilities including electricity, water, gas, telephone and associated deposits and connection fees. 14. Signs: County reserves the right to affix a sign that it deems appropriate to properly direct the public to the c5ffices housed in the leased premises. -Prior to installation, County agrees to submit plans to Landlord for approval, which approval shall not be unreasonably withheld. All signs erected by County shall comply with all the requirements of public authorities having jurisdiction with respect thereto. County further agrees to maintain the designation of the building on the leased premises as the Sawyer Building and will, throughout the term of this lease, keep permanently displayed and in its current location on the exterior of the building, the sign reading "Sawyer Building". 15. Parking: It is understood and agreed that contained within the leased premises and located east of the building located on the leased premises are six (6) parking spaces. It is 8 ~/ further understood that County, for the term of this lease, retains the exclusive right to these parking spaces. 16. Entire Agreement: This Lease contains the entire agreement between the parties hereto, and no promises, agreements, conditions or stipulations not contained herein shall be binding upon either party hereto Seisin-in--Law A North Carolina General Partnership By: Attest: General Partner Orange County Donna S. Baker Barry Jacobs Clerk to the Board Chair, Board of Commissioners This instrument has been preaudited in the manner required by the Local Government Budget and Fiscal Control Act. Finance Officer of Orange County F:~L.isalmiscellaneous\seisin in law 20081ease with orange county.dac.rtf 9