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HomeMy WebLinkAboutReso 01-21 Lease Site 87-88 Amend 1 (TLC)RESOLUTION NO. 01-21 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MORRO BAY, CALIFORNIA APPROVING AMENDMENT #1 TO THE MASTER LEASE AGREEMENT FOR LEASE SITE 87-88/87W-88W, LOCATED AT 833 EMBARCADERO, BETWEEN THE CITY OF MORRO BAY AND TLC FAMILY ENTERPRISES THE CITY COUNCIL City of Morro Bay, California WHEREAS, the City of Morro Bay is the lessor of certain properties on the Morro Bay Waterfront described as City Tidelands leases and properties; and WHEREAS, TLC Family Enterprises (Cherise Hansson and Travis Leage) have been the lessees of Lease Site 87-88/87W-88W since 2018, and are tenants in good standing; and WHEREAS, TLC Family Enterprises was granted approval of a new Master Lease Agreement on December 11, 2018 for a proposed lease site redevelopment project consisting of a complete site demolition and redevelopment of mixed restaurant, retail and hotel use; and WHEREAS, due to the social and economic effects of the COVID-19 pandemic it is now necessary to amend TLC's lease site redevelopment deadlines as stipulated in the lease to provide more time to complete the necessary redevelopment steps. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Morro Bay, California, as follows: 1. The attached Amendment #1 to the Master Lease Agreement for Lease Site 87-88/87W-88W is hereby approved. 2. The Mayor is hereby authorized to execute said Master Lease Agreement Amendment. PASSED AND ADOPTED by the City Council of the City of Morro Bay at a regular meeting thereof held on the 12th day of January, 2021 on the following vote: AYES Headding, Addis, Barton, Davis, Heller NOES' None ABSENT: None John H'-,ad.r, g, ayor--- ATTEST: ana Swanson, City Clerk AMENDMENT #1 TO THE LEASE AGREEMENT FOR LEASE SITE 87-88/87W-88W, LOCATED AT 833 EMBARCADERO This Amendment("Amendment #1 " is made and entered into as of this I2tdayof ) 2021, by and among the City of Morro Bay, a municipal corporation of the State of Califorslia, hereinafter called "City," and TLC Family Enterprises, a California corporation, hereinafter called "Tenant." (Collectively, City and Tenant are sometimes referred to herein as the "Parties.") WHEREAS, this Amendment #1 is to that certain Lease, which was signed on behalf of the Parties and is effective as of December 11, 2018 (the "Master Lease"); and WHEREAS, Tenant has received Precise Plan approval from the City of Morro Bay and Coastal Development Approval from the California Coastal Commission for a complete redevelopment of the site including new restaurant, retail and hotel use, and other public access improvements as -proposed; and WHEREAS, due to the social and economic effects of the ongoing COVID-19 pandemic it is necessary to amend the Master Lease to provide more time for Tenant to redevelop the lease site as -stipulated in the Master Lease; and WHEREAS, the Parties desire to amend the Master Lease so the redevelopment project can proceed as contemplated. NOW THEREFORE, Tenant and City agree as -follows: 1. Section 13.02 of the Master Lease Agreement between Tenant and City is replaced in its entirety to read as follows: Section 13.02TENANT'S Obligation to Redevelop Site CITY and TENANT agree TENANT will construct improvements to the Premises as outlined in Conditional Use Permit No. UPO-509 (CUP) consisting of complete demolition of existing improvements and new mixed -use retail, restaurant/bar, convenience food, transient occupancy (hotel) and slips/docks, and including improved vertical and lateral (Harborwalk) public access and outdoor children's play area (Project) and valued at a minimum of $3,600,000. Failure to complete the Project and to comply with all conditions of the CUP, as evidenced by a final building permit inspection as required by CITY in its governmental capacity, in addition to providing proof of expenses as evidenced by copies of invoices by the proscribed timeline shall be a material default of the Lease Agreement and subject to any remedies outlined in Article 11 herein, including termination of the Lease. TENANT acknowledges construction of the Project on the premises as outlined in the CUP requires, but may not be limited to, obtaining a permit from the California Coastal Commission, a City Precise Plan, and a City Building Permit. It is TENANT'S obligation to fully investigate the issues and costs in obtaining those approvals. Failure to obtain any and all required permits and approvals for the Project shall not be a reason for failure to comply with this section. TENANT further acknowledges the CUP and construction of the Project may require repair or replacement of all of portions of the docks, existing buildings, revetments, access ways, sidewalks, drainage systems and other current improvements on the Premises to the standards of the City Engineer and TENANT agrees to meet those standards through review and revision of the final Building Plans prior to issuance of a Building Permit for the construction of improvements on the Premises. TENANT further agrees to: A. In addition to complying with the bonding requirements set forth in Section 4.02, provide evidence of conditional or other financing necessary for completion of the Project, as -approved by the Harbor Director, Finance Director and City Attorney, no later than August 1, 2019.. B. File a complete application for a Coastal Development permit from the California Coastal Commission for the Project no later than January 8, 2019. C. Obtain a Coastal Development Permit and other necessary permits for the Project no later than June 8, 2019. D. File a complete application for Precise Plan review by the Planning Commission for the Project no later than September 8, 2019. E. Obtain Precise Plan approval from the Planning Commission for the Project no later than January 8, 2020. (NOTE Items A. through E , above, were timely completed prior to Amendment #1 revisions to this Section 13.02.) F. File a complete application for construction drawings and plans to obtain a Building Permit for the Project no later than February 11, 2021. G. Obtain Building Permits for the Project no later than May 11, 2021. H. Commence construction of the Project no later than November 1, 2021. Commencement shall mean when the TENANT has incurred at least $50,000 of hard construction costs for actual work satisfactorily completed for the Project on the site pursuant to the approved Building Permit. 1. Completion construction of all components of the Project no later than November 1, 2022. Completion shall mean when the Project is entitled to be issued a final Certificate of Occupancy. J. Provide CITY with written Project progress checks (Progress Checks) approximately every three months, beginning with the month of December, 2020, and every three months thereafter. Progress Checks will include, but not be limited to, the following: i. Status and details of TENANT'S financing to begin and complete the Project. ii. Status of TENANT'S meeting the deadlines as stipulated in this section. iii. TENANT'S efforts and activities to date in advertising, marketing and soliciting subtenants for the completed Project. During construction of the Project, TENANT shall take all measures to: A. Avoid any pollution of the atmosphere or littering of land or water by or o riginating in or about the Premises or caused by TENANT'S construction activities. B. Keep the noise level on the Premises to a minimum so that persons in the n eighborhood will be able to comfortably enjoy business and facilities in the area. C. Prevent any pollutants, including but not limited to petroleum products, from e ntering Morro Bay waters. D. Avoid negative impacts on surrounding businesses. E Prohibit storage of materials or equipment on public property and avoid parking or traffic delays or impairment without prior consent of CITY. F. Keep the construction site in a slightly, orderly, and safe manner at all times. 2. Except as expressly stated herein, all provisions of the Master Lease shall remain in full force and effect. 3. The effective date of this Amendment #1 is the date first written above. IN WITNESS WHEREOF, the parties hereto have executed this Amendment #1 as of the date written above. CITY OF MORRO BAY B y Joh , e-dying, FATior APPROVED AS TO FORM: 9Ins iititinAdAft" Chris F. Neumeyer, CiAtto ATTEST: 'DalketSL,0AN1/45tn---- Dana Swanson, City Clerk TLC Family Enterprises, a California Corporation Han son, re By: Travis Leage, S ry��