HomeMy WebLinkAboutC31490 A and B - Tenant Improvement for Suite 210 at the Parkveiw Office ComplexCITY OF PALM DESERT
FINANCE DEPARTMENT
STAFF REPORT
Request: Approve the tenant improvements in an amount not to exceed
$50,000 for Suite 210 at the Parkview office complex, and authorize
the City Manager to execute the contract to construct the tenant
improvements; approve the replacement of five air conditioners
(HVAC units) as needed in amount not to exceed $30,000 for Suite
210 and authorize the City Manager to execute the contract to
replace the air conditioners; and appropriate $80,000 from the
Enterprise Fund 510.
Submitted By: Paul S. Gibson, Finance Director
Applicant: County Of Riverside Economic Development Agency
PO Box 1180
Riverside, CA 92502
Supervisor Benoit Suite
Date: January 12, 2012
Recommendation
By Minute Motion, that the City Council:
Approve the tenant improvements in amount not to exceed $50,000 for
Suite 210 at the Parkview Office Complex, and authorize the City
Manager to execute the contract to construct the tenant improvements;(Contract C31490A)
2. Approve the replacement of 5 air conditioners (HVAC) units in amount
not to exceed $30,000 for Suite 210 at the Parkview Office Complex
and authorize the City Manager to execute the contract to replace the
Air Conditioners; and (Contract C31490B)
3. Appropriate $80,000 from the Enterprise Fund 510.
Background
On August 26, 2010 the City of Palm Desert and the County of Riverside entered into a
lease agreement to lease Suite 222. As of October 2011 Suite 210 became available.
Staff Report
County of Riverside EDA — County Supervisor Tenant Improvements
January 12, 2012
Page 2 of 3
Riverside County Supervisor Benoit and staff have requested the City's approval to
move from Suite 222 to Suite 210. Riverside County has leased Suite 222 since August
of 2004.
Riverside County has requested to move into Suite 210 because it provides a better
layout for the Supervisor and his staff. The tenant improvements for Suite 210 will
consist of replacing the carpet, painting the walls, installing a wall exhaust system in the
employee kitchen area, adding ADA access to the kitchen counter and sink, adding
ADA access to the receptionist counter, removing built-in wall filing units, and squaring
a wall for the conference area.
Riverside County staff has indicated they will reimburse the City for the cost in excess of
the normal tenant improvements covered by the City. The City will cover the cost of
replacing the carpet and painting the suite. The remaining cost will either be paid to the
City in one lump sum by the county or be paid back through the lease payment in 48
monthly payments or less. City staff anticipates a lease of no less than 5 years up to 10
years to be executed.
In addition to the tenant improvements for Suite 210, the County has asked City staff to
analyze the air conditioners servicing the suite. All air conditioners at the two-story
building were replaced in 1996 when the RDA acquired the Parkview Office Complex.
Some of those units have been replaced since 1996. An analysis will be performed and
only those units which are original to the 1996 replacement or are no longer efficient will
be replaced.
Given the anticipated timeframe, staff is requesting that Council approve the costs of
the tenant improvements and replacement of the air conditioners, and allow the City
Manager to execute the respective contracts. Bids for each of these projects will be
solicited from local and regional vendors, and the project awarded to the lowest
responsive bidder.
Funds are available in Fund 510 (Enterprise account) for the aforementioned
improvements.
Fiscal Analysis
The combined costs of $80,000 are the anticipated costs to complete the required
improvements to get the suite ready for Supervisor Benoit and his staff. As previously
mentioned, Riverside County will reimburse the City for those costs in excess of the
normally -provided tenant improvements. The reimbursement will be either in one lump
sum or paid back through the rent in a maximum of 48 monthly installments. City staff
will negotiate an interest rate if the County agrees to reimburse the City through their
rent.
Staff Report
County of Riverside EDA — County Supervisor Tenant Improvements
January 12, 2012
Page 3 of 3
City staff agrees that incurring the costs to improve Suite 210 is acceptable given the
gross revenue potential.
The County will pay a monthly lease rate of $3,952 for gross annual lease revenue of
$47,424 and minimum five-year gross revenue (unadjusted for CPI) of $237,120. The
anticipated gross revenues exceed the costs of tenant improvements.
Submitted By:
Paul S. Gibson, Director of Finance
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Approval:
M. Wohlmuth, City Manager
CITY COUNCILTION
APPROVED ✓✓ DENIED
RECEIVED OTHER
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VERIFIED BY:
Original on File witd Ci erk's Office