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HomeMy WebLinkAbout1998-06-08 98-237 ORDERmmr.�rn Date: 06/08/1998 Item NO.: 98=237 Item/Subject: Amendment to a Lease Agreement with Gary J. Hagan Responsible Department: Community and Economic Development See attached memo DepartmenfXeatl '/ Managers Comments: 9 r-cGCUANAk. City Manager Associated Information: dy,rp1 r a W"4A 4 Budget Approval: Legal Approval: Finance Director City Solicitor Introduced For % Passage First Reading Page t M Referral Assigned to Council« aonman June 8, 1998 CITY OF BANGOR GITEE.) (Drbtis Authorizing an Amendment to a Lease Agreement with Gary J. Hagan By Mier sky Cawwil of the City nf.Ra%y . ORDERED, WHEREAS, Gary J. Hagan has leased Lot 4 in the BIA Commercial / THAT Industrial Park since 1988; and WHEREAS, the lease agreement between Gary J. Hagan and the City of Bangor for said Lot requires that the annual rental rate be established for the period April 15, 1998 to April 14, 2003; NOW THEREFORE BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR THAT the City Manager is hereby authorized, on behalf of the City of Bangor, to execute an amendment to the lease agreement between Gary J. Hagan and the City of Bangor for Lot 4 in the BIA Commercial / Industrial Park, in a form approved by the City Solicitor or Assistant City Solicitor, and in substantially the same form as attached hereto. IN CITY COUNCIL June 8. 1998 Passed LER 98-23] 0 I DE It Title, Authorizing an Amendment to a Lease agreement with Gary J. Hagan ...................................... ................................... �d e Assignedd to 'Councilman 4,^ 98-237 THIS FIRST AMENDMENT TO INDENTURE OF LEASE, executed this th day of, May, 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 retained to as "Lessor"); AND GARY J. HAGAN, an individual, with his principal place of business at 12 Kelleran St., Houton, County of Aroostook, State of Maine (hereinafter sometimes referred to as 'Lessee") WITNESSETH: WHEREAS, the City of Bangor is the owner of an airport commonly known as "Bangor International Airport", 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 April 7, 1988, the parties agreed to the lease by the Lessor of Lot 4 in the BIA Commercial / Industrial Park, and WHEREAS, the parties hereto wish to amend said Indenture of Lease to establish the annual rental rate for the period April 15, 1998 through April 14, 2003; NOW, THEREFORE, the parties do mutually agree Nat the Indenture of Lease dated April 7, 1988 be and hereby is amended as tallows: (1) That the following be added to Article III - COMPUTATION OF ANNUAL RENTAL: D. During the period April 15, 1998 through April 14, 2003 the annual rental rate will be $6,000 paid monthly in the amount of FIVE HUNDRED DOLLARS ($500.00). THAT except for the foregoing, said Indenture of Lease, dated April 7, 1988, between the City of Bangor and Gary J. Hagan 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: By: (Witness) Edward A. Barrett City Manager GARY J. HAGAN Date: A= By: Gary J. Hagan Gaga] 98-237 BANAIRCORPORATION Bangor, Mem (4101 0p or ofAvapr Foreign T e 58 (207) W4842 (207) 9454449 (Fax) To: Members of the City Council From: Stephen A. Bolduc, Executive Manager Date: May 27, 1998 -AQut11 Subject: Amendment to a Lease Agreement with Gary J. Hagan Isnua The lease agreement between the City of Bangor and Gary J. Hagan for lot 4 in the BIA Commercial / Industrial Park, requires that the annual rental be established for the period April 15, 1998 to April 14, 2001 Background Gary J. Hagan leases Lot 4, 1.08 acres, in the BIA Commercial / Industrial Park. The term of the lease is from 1988 to 2008. On the property is a 9,073 sq. ft. office building currently [eased to Care Development. The lease rate during initial ten (10) year term increased in 1993 from $4,920 to $5,400 annually. The lease states that the rental rete for the five (5) year period 1998 - 2003 shall be "set based on fair market value and fair market lease return as negotiated or arbitrated ... except that during the period April 15, 1998 through April 14, 2003, monthly rental shall not be less than $500 each month or more than $750 each month;' Based upon the guidelines adopted by the Bangor City Council for determining the lease rate for land in the Bangor International Airport Complex, staff 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. The available lots in the BIA Commercial / Industrial Park were appraised in January, 1996 by The Sherwood Group Indicating that lots similar to Lot 4 have a 98-23] market value of $50,000 per acre. At that appraised value the monthly lease rate would be $450. However, the minimum lease rate established in the lease is $500 for the period. Gary J. Hagan has accepted the following proposed lease rate: $8,000 annually paid monthly in the amount of $500. The Board of Directors of the BanAlr Corporation and staff recommend approval of this amendment to the lease agreement under the terms and conditions outlined above.