10-24-2016 BPU RPT 10 - Laserfiche WebLink

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W A T E R E N E R C Y I WI& P U B L I C U T I L I T I E S BOARD OF PUBLIC UTILITIES RIVERSIDE PUBLIC UTILITIES Board Memorandum DATE: OCTOBER 24, 2016 ITEM NO: 10 SUBJECT: APPROVAL OF SIXTH AMENDMENT TO LEASE AGREEMENT WELLS FARGO BANK, NATIONAL ASSOCIATION— MISSION SQUARE OFFICE BUILDING, 3750 UNIVERSITY AVENUE, SUITE 150 — FIVE YEAR TERM FOR $1,310,000 IN REVENUE ISSUE: Approval of a Sixth Amendment to Lease Agreement for an additional five years between Wells Fargo Bank, National Association and the City of Riverside for approximately 7,766 square feet of rentable space in the Mission Square Office Building located at 3750 University Avenue, Suite 150. RECOMMENDATIONS: That the Board of Public Utilities recommend that the City Council: Approve the Sixth Amendment to the Lease Agreement with Wells Fargo Bank, National Association; and 2. Authorize the City Manager, or his designee, to execute the Sixth Lease Amendment, including making minor, non - substantive changes, and to sign all documents and instruments necessary to complete the transaction. BACKGROUND: On October 13, 2015, the City acquired the Mission Square Office Complex at 3750 University Avenue ( "Property "), which was funded by Riverside Public Utilities ( "RPU "). As such, RPU is now the Landlord of the Property. The Property consists of approximately 127,533 square feet of rentable office space in a six -story building, plus a basement level and a 489 parking stall garage situated on approximately 2.5 acres of land. On January 26, 2016, the City Council approved an Exclusive Authorization of Lease Agreement with Newmark of Southern California, Inc. dba Newmark Grubb Knight Frank ( "NGKF ") to provide broker - leasing services for the Property. RPU staff has been coordinating the leasing process for the Property with the Real Property Services Division of the Community & Economic Development and NGKF as the broker for the Property. Wells Fargo Bank has been a tenant in the Property since 1987 when it was initially operating as First Interstate Bank, which was subsequently merged into Wells Fargo Bank. The existing lease with Wells Fargo expires on July 31, 2017. Under the terms of the lease agreement, Wells Fargo has five -year options to renew through 2032.