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HomeMy WebLinkAbout1998-02-09 98-105 ORDERDate: MIN Item Ro.: 99-1o5 Mann/Subject: Amendment to a Lease Agreement with Darling's Responsible Department Community and Economic Development Commentary: See attached memo. y partmeni Manai Comments: L ffMM2N�. Associated Informatiori Ga I msmsundrrs Budget Approval: U7A /M. uvw° / city solicitor Introduced For X Passage First Reading Page 1 of 3 Referral 98-105 Aaiprad to Camegm aaldacci February 9, 1998 CITY OF BANGOR (TITLE.) (orbert Authorizing the City Manager to Execute an Amendment to a Lease Agreement with Darling's By the LWy Couae0. Of t14 Ctty efBasw: ORDERED, THAT the City Manager is hereby authorized, on behalf of the City of Bangor, to execute a First Amendment to Indenture of Lease with Darling's in a forth substantially the same as attached hereto. IN CITT COUNCIL9199 Passed y 9, 1998 Passed 98-105 0ROER r_ Title, Authorizing the City Manager Co CIT CLERrt ExecuCe an Amendment Co a Leese Agree- ment with ........ .....lith Darling .ling..................... ...................................... ZRLt a.� Armed W .3.0 ....... 0 �o;ntilman !m THIS FIRST AMENDMENT TO INDENTURE OF LEASE, executed this _ th day of January, 1998 by and between: CITY OF BANGOR, a municipal corporation organized and existing under and by virtue of the laws of the State of Maine, and having its principal offices at 73 Harlow Street, Bangor, Maine (hereinafter sometimes referted to as "Lessor'); AND DARLING'S, a corporation organized and existing under the laws of the State of Maine, and having a regular place of business in Bangor, County of Penobscot, State of Maine (hereinafter sometimes referred to as "Leasee') WITNESSETH: WHEREAS, the City of Bangor is the owner of an airport commonly known as "Bangor International AlrpoW, formerly known as Dow Air Force Base, located in the City of Bangor, County of Penobscot, State of Maine (hereinafter sometimes referred to as the "Airport'); and WHEREAS, by Indenture of Lease, dated October 7, 1977, the Lessor agreed to the lease by At Worcester & Sons of Lot 10 in the BIA Commercial / Industrial Park subdivision, Bangor International Airport; and WHEREAS, by Assignment of Lease, dated December 15, 1982, the Lessor agreed to the assignment by At Worcester & Sons W Daring's of Lot 10 in the BIA Commercial / Industrial Parc subdivision, Bangor Intemational Airport; and WHEREAS, the parties hereto wish to amend said Indenture of Lease to extend the term and establish the rental rate; NOW, THEREFORE, the parties do mutually agree that the Indenture of Lease dated October 7, 1977 and assigned December 15, 1982, be and hereby is amended as follows: (1) Article II - TERM is deleted in its entirety and replaced with the following: ARTICLE II -TERM TO HAVE AND TO HOLD the demised premised unto the Lessee for the term of ten (10) years, commencing on October 1, 1997 and terminating on September 30, 2007. 98-105 cedng's First Amendment b Imlentum of Lease (2) ARTICLE III - COMPUTATION OF ANNUAL RENTAL is deleted in its entirely and replaced with the following: ARTICLE III - COMPUTATION OF ANNUAL RENTAL The rent to be paid by Lessee to Lessor during the term of this lease shall be as follows remitted in advance on the first day of each and every month: October 1 1997 to September 30 2002 $11,000 annually paid monthly in the amount of $916.67. October 1 2002 to September 30 2007 The monthly lease payment during this period will be determined as follows: the monthly lease payment of the previous five year period, $916.87, plus the product of $916.67 multiplied by the sum of the five annual percentage changes in the Consumer Price Index, the All Items expenditure category, for the period August, 1997 to August, 2002. The annual percentage change is calculated by subtracting the value of the index on August at the beginning of the period, eg. August, 1997, from the value of the index an August of the following year, eg. August, 1998 and dividing the remainder by the value of the index on August at the beginning of the period, eg. August, 1997. The annual percentage change will be the percent resulting from the above calculation but in no case greater than five (5%) percent for any year. The term "Consumer Price Index" is the "monthly unadjusted Consumer Price Index for All Urban Consumers (CPI -U)" published by the United States Department of Labor, Bureau of Labor Statistics. In Ore event that the CPI -U index should cease to be published during the term of this lease, the rental adjustment for the subsequent five-year period shall be calculated as stated above by reference to the annual percentage change in any substitute index published by the U.S. Dept, of Labor or other reliable source which authoritatively represents the annual change in urban consumer prices in the United States over the preceding five-year period. ri 1 Darling's Ron Amendment to lmranrure of Lease Lessee shall pay all rentals herein required, without prior demand therefor, in lawful money of the United States, at the address of the Lessor as set forth herein or at such other reasonable places as the Lessor may designate. Late payments shall be subject to an additional interest charge of one and one- half per cent (1.5%) per month to the date of payment. THAT except for the foregoing, said Indenture of Lease dated October 7, 1977 and assigned December 15, 1982, between the City of Bangor and Dariing's will remain in full force and effect in all other respects between the undersigned. IN WITNESS WHEREOF, the parties hereto have set their hands and seals the day and year written above. CITY OF BANGOR Date: MA (Witness) Edward A. Barreft City Manager DARLING'S Date: (Witness) (Name Printed) Page 3 BANAIRCORPORATION F,re as Z 58 To: Members of the City Council From: Stephen A. Bolduc, Executive Manager Date: February9, 1998 � SQAB Subject: Amendment to a Lease Agreement with Darling's 98-105 THE GROWING ADVANTAGE Issue Darling's has exercised its option to extend its lease of Lot 10 in the SIA Commercial / Industrial Park and accepted the following terms. leases Lot 10, 2.75 acres, in Me BIA Commercial / Industrial Park which was originally leased in 1977. On the property Is a 9,000 sq. ft. building currently leased to Union Street Athletics, a physical threes studio. Fixed dollar amounts were sat in the original agreement for Me initial twenty (20) year tern increasing three (3) times during that period. The most recent rete was for the period 1992 - 1997 at a rate of $11,604 annually ($4,220 per acre). The lease grams Darling's the option to extend the lease for an (10) years or until September 30, 2007 at a rate to be negotiated between the parties. Based upon the guidelines adopted by the Bangor City Council for determining the lease rate for land in Me Bangor International Airport Complex, we proposed that the annual lease rate during the extension period be established at 10% of the fair market value of the land. Fair market value to be established through a recent appraisal. Furthermore, the lease rate would be adjusted every 5 years in order to reflect changing land values. naAewwsmem sAumwe m"I pon w -vu ry0n 915M9I FAX 98-105 The available lots in the BIA Commercial / Industrial Park had been appraised in January, 1990 by The Sherwood Group indicating that lots similar to Lot 10 have a market value of $40,000 per acre. Therefore the lease rate for the 2.75 acres leased by Darlings would be $11,000 per year. Darlings has agreed to the following terms for the period through 2007. $11,000 annually paid monthly in the amount of $910.67. October 1 2002 to Septernber 30 2007 The lease rate would be adjusted by the sum of the five annual changes in the Consumer Price Index during the period 1997 to 2002 with a cap of 25%. The Board of Directors of the BanAir Corporation recommend approval of the amendment.