HomeMy WebLinkAbout2010-07-12 10-254 ORDERCOUNCIL ACTION
Item No. 0 4 1
Date: July 12, 2010
Item/Subject: ORDER, Authorizing an Amendment to the Indenture of Lease with Bank
of America at 1176 Union Street
Responsible Department: Community and Economic Development
Commentary:
Bank of America has proposed a revision to their lease of land at 1176 Union St., Lot 2 in the BIA
Commercial / Industrial Park due to cost cutting measures they are implementing in response to
recent economic conditions. They are evaluating their "distribution strategy for Maine" to determine
whether to maintain the Union St. branch.
The City of Bangor has leased 0.76 acres at 1176 Union St. since 1969. The term will expire on June
30, 2011. Bank of America has two (2), five (5) year option periods to extend the lease, in 2011 and
2016. The current rate is six hundred dollars ($600.00) monthly. If an extension is exercised, the
lease states that the rate would be adjusted to 9% of the "fair market value". Bank of America pays
$9,032 in property taxes based on a 2009 assessment of $474,100.
The proposed terms and conditions are: the term would be extended to June 30, 2016; Bank of
America would have the option to terminate the lease on 6/30/14 providing a six (6) month notice;
five (5) option periods of five (5) years each beginning in 2016; the rate would remain at $600
monthly during 2011-12; the rate would then increase by 2% during each of the next four (4) years;
if any extension is exercised the rate would be increased by the change in the Consumer Price Index
(CPI) during the previous five (5) years with a floor of 1% and a ceiling of 5% for any one year; and
Bank of America would not be obligated to operate continuously or to operate during certain hours.
Department Head
Manager's Comments:
This has been reviewed and is recommended for approval by the Business and Eco is
Development Committee. �1.1
*� City Manager
Associated Information: Order
Budget Approval:
Legal Approval:
Introduced for
x Passage
First Reading
Referral
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I - - " FirQnce Director
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City Solicitor
Page _ of
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Assigned to Councilor — Weston July 12, 2010
CITY OF BANGOR
(TITLE.) ORDER, Authorizing an Amendment to the Indenture of Lease with Bank of
America at 1176 Union Street
WHEREAS, by Indenture of Lease, dated November 26, 1969, the City of Bangor and Fleet
National Bank as successor in interest to the Merrill Trust Company, agreed to
the lease by the Lessor of, what is now known as Lot 2 in the BIA Commercial /
Industrial Park subdivision; and
WHEREAS, by Indenture of Lease, dated March 29, 2002, the City of Bangor and Fleet
National Bank termanated said prior lease and entered into an agreement for Lot
2 in the BIA Commercial / Industrial Park subdivision; and
WHEREAS, Bank of America, as successor in interest to Fleet National Bank, wishes to
amend said agreement:
BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR THAT
The Interim City Manager is hereby authorized, on behalf of the City of Bangor, to execute an
amendment to the Indenture of Lease with Bank of America, as successor to Fleet National
Bank, for the land at 1176 Union Street, Lot 2 in the BIA Commercial / Industrial Park in a form
approved by the City Solicitor or Assistant City Solicitor and containing the following terms and
conditions:
1) The term would be extended to June 30, 2016, an additional five (5) years.
2) Bank of America would have the option to terminate the lease on 6/30/14 providing a
six (6) month notice.
3) There will be five (5) option periods of five (5) years each beginning in 2016.
4) The lease rate during 2011-12 will be $600 monthly.
5) The rate will increase by 2% during each of the next four (4) years beginning 2012.
6) If any extension is exercised, the rate would be increased by the change in the
Consumer Price Index (CPI) during the previous five (5) years with a floor of 1% and a
ceiling of 5% for any one year.
7) Bank of America would not be obligated to operate continuously or to operate during
certain hours.
IN CITY COUNCIL
July 12, 2010
Motion Made and Seconded for Passage
Motion Doubted
Vote: 6-3
Councilors Voting Yes: Bronson,
Gratwcik, Hawes, Nealley, Palmer,
Wheeler
Councilors Voting No: Blanchette,
Stone, Weston
Passed
(TITLE,) Authorizin an Amendment to
_The indenture of Lease with Bank of
America at 1176 Union Street
Assigned to Conneflo l.,/
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