TO:
Honorable Mayor and Members of the City Council
THROUGH:
Talyn Mirzakhanian, City Manager
FROM:
Libby Bretthauer, Finance Director
Masa Alkire, Community Development Director
SUBJECT:Title
Consideration of a Resolution Approving an Amended and Restated Ground Lease and Parking Lot Lease Between the City and Bay Club for the Manhattan Country Club Properties Located at 1330-1332-1334 Parkview Avenue (Partially Budgeted) (Finance Director Bretthauer).
ADOPT RESOLUTION NO. 26-0109
Body
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RECOMMENDATION:
Staff recommends that the City Council: 1) adopt Resolution No. 26-0109 approving an amended and restated ground lease and parking lot lease (“Lease”) with Bay Club for the Manhattan Country Club Property Located at 1330 Parkview Avenue; and 2) authorize the City Manager to execute the Lease.
FISCAL IMPLICATIONS:
The City currently receives approximately $671,000 in rent payments from the Bay Club for the ground leases at the Manhattan Country Club, the 1334 Office Building, and 50 parking spaces near Manhattan Village Field. These payments break down as follows:
Current Leases
FY 2027 Budget
Country Club
$570,000
1334 Office Building
59,000
Parking Spaces
42,000
Total
$671,000
The existing leases generate revenue on various bases, some of which will no longer apply under the amended Lease. The Country Club lease terms are currently based on a fixed rent plus a percentage from tennis tournaments, food and beverage, and retail/office rentals. This lease structure does not capture the Country Club’s primary revenue stream from membership dues, resulting in the City’s revenue remaining relatively flat over time.
The Office building, which is planned for demolition, currently pays rent based on a fixed amount plus a percentage rent from tenants. Rent from the parking spaces is a fixed amount.
The renegotiated Lease includes one fixed rent payment with annual CPI adjustments...
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