HomeMy WebLinkAboutParkview - Sublease for Suite 210CITY OF PALM DESERT
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FINANCE DEPARTMENT
STAFF REPORT
Request: Approve sublease between the Altum Group and John Cover Associates
for suite 210 at the Parkview Office Complex.
Submitted by: Paul S. Gibson, Finance Director
Applicant: The Altum Group
73-255 El Paseo Drive, Suite 15
Palm Desert, CA 92260
Date: November 15, 2012
Contents: Copy of letter requesting approval of sublease
Draft of Sublease Agreement
Recommendation
By Minute Motion, that the City Council approve the sublease between
The Altum Group and John Cover Associates for Suite 210 at the
Parkview Office Complex.
Background
On October 11, 2012 the City Council approved the lease agreement between the City
of Palm Desert and the Altum Group to lease Suite 210 at the Parkview Office Complex.
The lease is scheduled to commence on December 1, 2012. Currently, the Altum Group
shares space with John Cover Associates at their El Paseo office. John Cover
Associates is an integral part of the Altum Group's business so they would like to
continue their business relationship at the Parkview Office Complex; therefore, they
have requested the City to approve the sublease between the Altum Group and John
Cover Associates per Section 12 of their lease agreement with the City.
Section 12.4(b) of the lease agreement between the City and the Altum Group states as
follows: "No sublease entered into by lessee shall be effective until it has been
approved in writing by lessor."
Staff recommends that the City Council approve the sublease between the Altum Group
and John Cover Associates to sublease space in Suite 210 at the Parkview Office
Complex.
GAFinance\Niannh Ortega\Staff Repo rts\Pa rkview\S R - Altum Sublease - open 111512.docx
Staff Report
The Altum Group Sublease with John Cover and Associates
November 15, 2012
Page 2 of 2
Fiscal Analysis
The sublease has no fiscal impact to the City of Palm Desert. All lease payments to the
City of Palm Desert are the responsibility of the Altum Group.
Submitted By:
4aulS.bson, Director of Finance
PSG:AH:nmo
Approval:
City Manager
CITY COUNCIL ACTION
APPROVED ✓ DENIED
RECEIVED—OTHER-------------
MEETING----�
DATE
AYES:
NOES:
ABSENT- d,.IW
ABSTAIN: P i
VERIFIED BY:
Original on File with City Clerk's Uflice
GAFinance\Niamh Ortega\Staff Repo rts\Parkview\SR -Altum Sublease -open 111512.docx
Hernandez, Anthony
From: John L. Cover [John@jlcover.com]
Sent: Monday, November 05, 2012 12:56 PM
To: Hernandez, Anthony
Subject: Altum sub -lease
Anthony -
I have been a Developer and California licensed General Contractor ( License # 408-512 currently
inactive) and Real Estate Broker (License #00771554) in California for many
years. I am currently working on developing renewable energy based
solutions for sustainable development. I recently spent 3 months in Abu
Dhabi and Dubai studying the Masdar City concepts to see if our greater Palm Springs
area and in particular a 7,000 acre area known as "Dillon Canyon" might serve as a site for a
complementary sustainable sister city using many of the same strategic partnerships
that were employed between M.I.T., General Electric, and many others in a public/private joint
venture. It is good to be able to share GIS mapping and the general expertise of The Altum Group
who I have worked with for many years.
I have occasional visitors by appointment.
I am looking forward to working with the City.
Best Regards -
John Cover
John L. Cover & Associates
Cell: 760-774-5624
73-255 Ell Paseo Drive, Suite 15
Palm Desert, California 92260
760.346.4750 Tel
760,340.0089 Fax
The Altum (==roup
October 15, 2012
Thomas Jefferies
Finance Director
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, CA 92260-2578
Subject: Potential Lease Of Office Space
Dear Mr. Jefferies:
As we discussed The Altum Group currently shares and office with John Cover Associates, whom we
brought to one of our on -site meetings with you. Our association with John includes common use of GIS
software and plotting equipments. Our desire to to lease Suite 211 in the City owned building located at
73-710 Fred Waring Drive, Palm Desert, included John as a sub -lessee to us. He would be occupying the
office with the separate entry near the kitchen. We would ensure that John follows all provisions of our
lease, and we would be responsible for paying for this office space which is part of the lease we are
currently negotiating. Our relationship to John is key to our operation and we need verification that the
City would accept this arrangement..
We would appreciate your consideration at your earliest convenience as we are already making plans
for the move.
Ole
President
mike.peroni@thealtumgroup.com
this Sublease, Sub -landlord represents and warrants to Subtenant that no real estate broker,
agent or finder negotiated or was instrumental in negotiating or representing Sub -landlord in the
negotiation of this Sublease. Subtenant shall pay the commission or fee of any other broker,
agent or finder acting for Subtenant or claiming any commission or fees on the basis of contacts
or dealings with Subtenant and not disclosed herein by Subtenant, and Subtenant shall
indemnify and hold Sub -landlord harmless from and against any claims made by any such
broker, agent or finder and any and all costs and damages suffered by Sub -landlord as a
consequence thereof, including, without limitation, attorney's fees. Sub -landlord shall pay the
commission or fee of any other broker, agent or finder acting for Sub -landlord or claiming any
commissions or fees on the basis of contacts or dealings with Sub -landlord and not disclosed
herein by Sub -landlord, and Sub -landlord shall indemnify and hold Subtenant harmless from and
against any claims made by any such broker, agent or finder of Sub -landlord and any and all
costs and damages suffered by Subtenant as a consequence thereof, including, without
limitation, attorney's fees.
Section
21. Holding Over
If, without objection by Sub -landlord, Subtenant holds po sion he Subleased Premises
after expiration of the Term, Subtenant shall become a ant from th to month upon the
terms herein specified, in which event either party m erminate this lease upon not less
than thirty (30) days prior written notice to the of arty
22.
Se
.1. 1
Section
.2. Authority
The individual or indivi signin his Sublease on behalf of Subtenant represent and warrant
that: (i) Subtenant has f we d authority to enter into this Sublease and to perform this
Sublease; (ii) the execution, ery and performance of this Sublease by Subtenant have been
duly and validly authorized by II necessary action on the part of Subtenant and all required
consents and approvals have been duly obtained; and (iii) this Sublease is a legal, valid and
binding obligation of Subtenant, enforceable against Subtenant in accordance with its terms,
subject to the effect of applicable bankruptcy, insolvency, reorganization, arrangement,
moratorium or other similar laws affecting the rights of creditors generally.
Section
22.3. Remedies
Sub -landlord shall have the right, upon Subtenant's default hereunder, in addition to the
remedies set forth in this Sublease, to exercise against Subtenant any and all of the rights and
remedies described in the Master Lease as available to Master Landlord in the event of a default
by the Tenant under the Master Lease.
Section
22.4. Independent Covenants
This Sublease shall be construed as though the covenants between Sub -landlord and Subtenant
are independent.
Section
22.5. Attorney Fees
If either party commences an action against the other in connection with this Sublease, the
prevailing party will be entitled to recover costs of suit and reasonable attorney's fees.
By: M
n Cover and Associates
John Cover
Section 1.
Section 2.
Section 3.
Section 4.
Section 5.
Section 6.
Section 7.
Section 8.
Section 9.
Section 10.
Section 10.1.
Section 10.2.
Section 11.
Section 12.
Section 12.1.
Section 12.2.
Section 12.3.
Section 12.4.
Section 13.
Section 14.
Section 15.
Section 16.
Section 17.
Section 18.
Section 19.
Section 20.
Section 21.
Section 22.
Section 22.1
Section 22.2
Section 22.3
Section 22.4
Section 22.5
SUBLEASE
TABLE OF CONTENTS
Definitions
Subleased Premises
Use
Term
As -Is Condition
Rent
Office Services
Security Deposit
Alterations
Indemnity; Waiver of Liability
Indemnity
Waiver of Liability
Condition at Termination
Master Lease
Subject to Master Lease
No Violation of Master Lease
Incorporation of Master Lease
General Qualifications
Amendment of Master Lease
Tarminntinn I Innn r)afaidf
SUBLEASE
THIS SUBLEASE ("Sublease"), dated as of November 15, 2012, is made by and between the
Altum Group ("Sub -landlord"), and John Cover and Associates. ("Subtenant").
RECITALS
A. The City of Palm Desert ("Master Landlord") and Sub -landlord entered into a written lease
("Master Lease") for certain premises ("Premises") located in that certain office building
commonly known as Suite 200 of 73-710 Fred Waring Drive, Palm Desert, CA 92260, which
Premises are more particularly described in the Master Lease.
B. Subtenant acknowledges that it has reviewed a copy of the Master Lease and is fully familiar
with the provisions thereof.
C. Subtenant desires to sublet a portion of the Premises from Sub -landlord, and Sub -landlord
desires to sublet a portion of the Premises to Subtenant, upon the terms and conditions
hereinafter set forth in this Sublease.
NOW, THEREFORE, in consideration of the mutual promises contained herein, and other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Sub -
landlord and Subtenant agree as follows:
Section
1. Definitions
All capitalized terms used in this Sublease and not otherwise defined herein shall have the
respective meanings ascribed to them under the Master Lease.
Section
4. Term
The term (the "Term\op
ub se shall commence on December 1, 2012 (the
"Commencement Dahall d on November 30, 2015 (the "Expiration Date"), unless
sooner terminated ua ' of the Master Lease or pursuant to any provisions hereof.
Subtenant shall haveo extend the Term.
Section
5. As -Is Condition
Subtenant agrees that it is leasing the Subleased Premises on an "AS -IS" basis, with all defects,
without any representation or warranty by Sub -landlord or its agents as to the condition of the
Subleased Premises or their fitness for Subtenant's use, and subject to all applicable zoning,
municipal, county and state laws, ordinances and regulations governing and regulating the use of
the Subleased Premises, and any easements, covenants or restrictions of record. Subtenant
acknowledges that Sub -landlord and its agents have not made any representations or warranties
that the Subleased Premises or the Building comply with Legal Requirements, including, but not
limited to, the ADA, Title 24, any transportation management plans, or any laws relating to
hazardous substances or materials, and as a material inducement to Sub -landlord, Subtenant
assumes any and all responsibility for causing the Subleased Premises to comply with all Legal
Requirements throughout the Term. Subtenant acknowledges that it has satisfied itself that the
Subleased Premises are suitable for its intended use. Sub -landlord shall have no obligation to do
any work in and to the Subleased Premises in order to prepare the Subleased Premises for
occupancy or use by Subtenant.
Section
6. Rent
Subtenant shall not pay the Sub -landlord rent for the Subleased Premises.
In the event of any casualty or condemnation affecting the Subleased Premises, Rent shall be
abated hereunder only as to the portion of the Subleased Premises and only to the extent that
Rent is abated under the Master Lease.
Concurrently with the executio
Sub -landlord any se(
Subtenant, Subtenant is not required to provide
Section
9. Alterations
Subtenant shall not make any alterations to the Subleased Premises without the prior written
consent of Sub -landlord, which consent may be granted or withheld in Sub -landlord's sole and
absolute discretion. Sub -landlord's consent to any proposed alterations shall in each instance be
deemed to be conditioned upon Sub -landlord obtaining the consent of Master Landlord to such
alterations. If Sub -landlord shall obtain the consent of Master Landlord, Subtenant shall comply
with all the provisions of the Master Lease relating to alterations.
Section
10. Indemnity; Waiver of Liabilit
Section
10.1. Indemni
Subtenant shall protect, indemnify, defend and hol arml ub-landlord and its directors,
officers, partners, employees, agents, successors an s (collectively, "Indemnitees") from
and against any and all claims, demands, obli ations, ges (including consequential and/or
punitive damages), costs, liabilities, actions gmen ollectively, "Claims") including,
without limitation, Claims for injury or dama to s o roperty, and Claims for penalties,
fines and reasonable attorney's fees and costs c orney's fees and costs incurred to
enforce this indemnity), incurred in tion or arising from this Sublease, however the
same may have been caused (inc ng, thou itation, if caused in whole or in part by the
act, omission, or active or pass' negli ce of emnitees, except with respect to any
Indemnitee, to the extent cause t criminal misconduct or such Indemnitee), and
including, without Limiting t en y of the foregoing, Claims arising out of or in connection
with: (1) any default by t i observance or performance of any of the terms,
covenants or conditio f this as Subtenant's part to be observed or performed, or (2)
the use or occupanc manner o se or occupancy of the Subleased Premises by Subtenant or
any person or entity cl . g thro or under Subtenant, or (3) the condition of the Subleased
Premises or any occurren r h ening on the Subleased Premises from any cause
whatsoever, or (4) any act, ion or negligence of Subtenant or any person or entity claiming
through or under Subtenant, o of any or Subtenant's agents, employees, contractors,
subtenants, licensees, invitees or visitors, occurring in, on or about the Subleased Premises,
either prior to the commencement of, during, or after the expiration of the Term, including
without limitation any acts, omissions or negligence in the making or performing of any
alterations, or (5) any failure by Subtenant to surrender the Subleased Premises at the end of
the Term, including, without limitation, all rent and damages payable to Master Landlord
pursuant to the Master Lease. In the event any action or proceeding is brought against any
Indemnitee for any Claim against which Subtenant is obligated to indemnify or provide a defense
to an Indemnitee hereunder, Subtenant upon notice from Sub -landlord shall defend such action
or proceeding at Subtenant's sole expense by counsel approved by Sub -landlord, which approval
shall not be unreasonably withheld. The provisions of this Section 10.1 shall survive the
expiration or earlier termination or this Sublease.
Section
10.2. Waiver of Liability
(a) Sub -landlord shall not be liable to Subtenant, and Subtenant hereby waives all claims against
Sub -landlord for any loss, injury, or other damage to person or property in or about the
Subleased Premises or the Building from any cause whatsoever, including without limitation,
water leakage of any character from any walls, basement or other portion of the Subleased
Premises or the Building, or gas, fire, explosion or other electricity within the Subleased Premises
or the Building or acts of other tenants of the Building: provided, however, that the foregoing
waiver shall be inapplicable to any loss, injury or damage resulting from the gross negligence or
willful or criminal misconduct of Sub -landlord or Sub -landlord's breach of any covenant
hereunder. Subtenant expressly assumes all responsibility for security, in, on or about the
Subleased Premises, and Sub -landlord shall not be liable for any damage to goods, wares,
merchandise or other property located in the Subleased Premises, or injury or death to
Subtenant's employees, invitees, customers or any other person in or about the Subleased
Premises. The foregoing waiver includes criminal acts of third par
(b) Except as otherwise provided, Sub -landlord shall not be ult hereunder or be liable for
any damages directly or indirectly resulting from, nor sha I cons e a constructive eviction of
subtenant, nor shall the rental herein reserved be abat y reason (i) the installation use, or
interruption of use of any equipment in connection w' he fusrnishing ny of the services
described in the Master Lease (as incorporated by ion of this Sublease); (ii) failure to
furnish or delay in furnishing any such services (or t Services described in Section 7
above) when such delay is caused by accident or any c 'tion beyond the reasonable control of
Sub -landlord or by the making of reasonabl s or i vements to the Subleased Premises
or to the Building; or (iii) the limitation curta a nin r restriction on use of water,
electricity, gas or any other utility or similar c p g the Subleased Premises or the
Building.
dition at Termination
Prior to the expiratio earlier in n of this Sublease, Subtenant shall remove its trade
fixtures, personal pr ty and an Iterations made in accordance with Section 9 and shall
surrender the Sublease emises Sub -landlord in "broom clean" condition and in as good
order, repair and conditio w the Subleased Premises were delivered to Subtenant,
ordinary wear and damage mage by fire and the elements excepted.
Section
12. Master Lease
Section
12.1. Subject to Master Lease
This Sublease is and shall at all times be subject and subordinate to the Master Lease, and every
provision thereof. Subtenant acknowledges that Subtenant's use and enjoyment of the
Subleased Premises are subject to the rights of Master Landlord pursuant to the Master Lease.
Section
12.2. No Violation of Master Lease
Subtenant shall not commit or permit to be committed any act or omission which would violate
any term or condition of the Master Lease. Subtenant shall not have any authority to contact or
make any agreement with Master Landlord regarding the Subleased Premises or the Master
Lease. If the Master Lease terminates, this Sublease shall terminate and the parties shall be
relieved of any further liability or obligation under this Sublease: provided, however, that if the
Master Lease terminates as a result of a default or breach by Sub -landlord or Subtenant under
this Sublease and/or the Master Lease, then the defaulting party shall be liable to the
nondefaulting party for the damage suffered as a result of such termination. Notwithstanding the
foregoing, if the Master Lease gives Sub -landlord any right to terminate the Master Lease in the
event of the partial or total damage, destruction, or condemnation of the Master Premises or the
building or project of which the Master Premises are a part, or by exercising any cancellation
option, the exercise of such right by Sub -landlord shall not constitute a default or breach
hereunder.
Section
12.3. Incorporation of M r Lease
The terms of the Master Lease are hereby incorpor d by r rence and made a part of this
Sublease, and to the extent such provisions impose ns on Sub -landlord as Tenant under
the Master Lease, Subtenant does hereby expressly as a and agree to perform and to comply
with, each and every obligation of Sub-landl Tenan
(a) Notwithstanding anything to
deemed to be in default un thi!
Landlord to perform its
utilities, repairs, resto on, ma
other obligations or ices to be
Lease, Sub -landlord's s obligati
reasonable efforts to req a
under the Master Lease, pro
against Master Landlord.
S
4. nera ualifications
c ined herein, in no event shall Sub -landlord be
ease or liable to Subtenant for any failure of the Master
the Master Lease. With respect to all work, services,
na compliance with law, insurance, indemnification or
rformed or provided by Master Landlord under the Master
shall be, without expense to itself, to exercise commercially
Landlord to comply with the obligations of Master Landlord
at in no event shall Sub -landlord be required to file suit
(b) Notwithstanding anything to the contrary contained in this Sublease, the time limits specified
in the Master Lease for the giving of notice, making of demands, performance of any act,
condition or covenant (including cure of any breach) or the exercise of any right, remedy or
option, are hereby decreased or increased for purposes of this Sublease, by lengthening or
shortening the same, as the case may be, in each instance by five (5) days, when necessary to
enable Sub -landlord to give notice, make demands, perform any act, correct any failure, or
otherwise to perform under the Master Lease in a timely manner.
(c) Wherever the Master Lease requires the consent of the Landlord be obtained, Master
Landlord's consent and Sub -landlord's consent shall be required. It shall not be unreasonable for
Sub -landlord to withhold consent under any circumstances where Master Landlord withholds its
consent, whether or not Master Landlord acts reasonably in so doing.
Section
13. Amendment of Master Lease
Subtenant acknowledges and agrees that Sub -landlord shall have the right at any time and from
time to time to amend the Master Lease without the consent of Subtenant, provided that such
amendments shall not materially adversely affect Subtenant's rights hereunder.
Section
14. Termination Upon Default
In any notice given pursuant to Section 15 below, Sub -landlord in its sole discretion may elect to
declare a forfeiture of this Sublease as provided in Section 1161 of the California Code of Civil
Procedure, and provided that Sub -landlord's notice states such an election, Subtenant's right to
possession of the Subleased Premises shall terminate and this S ase shall terminate, unless
on or before the date specified in such notice all arrears of Re d all other sums payable by
Subtenant under this Sublease, and all costs and expenses i by or on behalf of Sub -
landlord hereunder, including attorney's fees incurred in co ecti ith such defaults, shall
have been paid by Subtenant and all other breaches of Subleas Subtenant at the time
existing shall have been fully remedied to the satisfa of Sub -land Upon such
termination, Sub -landlord may recover from Subte t: (a worth at the time of award of
the unpaid Rent which had been earned at the time ation; (b) the worth at the time of
award of the amount by which the unpaid Rent which d have been earned after termination
until the time of award exceeds the amount Rent that Subtenant proves could
reasonably have been avoided; (c) the worth of and of the amount by which the
unpaid Rent for the balance of the Term of thi u er the time of award exceeds the
amount of such Rent loss that Su bt rove Id be reasonably avoided; and (d) any other
amount necessary to compensate -la lord all the detriment proximately caused by
Subtenant's failure to perform i bliga ' s and this Sublease or which in the ordinary course
of things would be likely to resu er orth at the time of award" of the amount
referred to in clauses (a) a b) is computed by allowing interest at the rate of ten
percent (10%) per ann or t the time of award" of the amount referred to in clause
(c) above is compute discou g s amount at the discount rate of the Federal Reserve
Bank of San Francis the time award plus 1%. For the purpose of determining unpaid Rent
under clause (c) above, month rent reserved in this Sublease shall be deemed to be the
Rent payable by Subtena rs to Section 6 above.
Section
15. Notices
All notices, consents, demands and other communications from one party to the other given
pursuant to the terms of this Sublease or under the laws of the State of California, including but
not limited to, notice under the provisions of Section 1161 of the California Code of Civil
Procedure and Section 1946 of the California Civil Code, shall be in writing and shall be deemed
to have been fully given when deposited in the United States mail, certified or registered,
postage prepaid, and addressed to Subtenant or Sub -landlord at the addresses respectively
specified below or to such other place as Subtenant or Sub -landlord may from time to time
designate by a written notice to the other; or, in the case of Subtenant, delivered to Subtenant
at the Subleased Premises or at any place where Subtenant or any agent or employee of
Subtenant may be found if sent subsequent to Subtenant's vacating, deserting, abandoning or
surrendering of the Subleased Premises. Subtenant hereby appoints as its agent to receive the
service of all dispossessory or distraint proceedings and notices thereunder the person in charge
of or occupying the Subleased Premises at the time, and, if no person shall be in charge of or
occupying the same, then such service may be made by attaching the same on the main
entrance of the Subleased Premises. Subtenant hereby agrees that service of notice in
accordance with the terms of this Sublease shall be in lieu of the methods of service specified in
Section 1162 of the California Code of Civil Procedure. The provisions of subdivision (a) of
Section 1013 of the California Code of Civil Procedure, extending the time within which a right
may be exercised or an act may be done, shall not apply to a notice given pursuant to this
Sublease.
The address for Sub -landlord is:
The Altum Group
73-710 Fred Waring Drive, Suite 210
Palm Desert, CA 92260
The address for Subtenant is:
John Cover and Associates
73-710 Fred Waring Drive, Suite 210
Palm Desert, CA 92260
No director, officer, shareholder, employee,
liable in any manner or to any extent under
Sub -landlord or any of its directors, officers, lusf
responsible for any consequential�'nter
limitation, on account of lost profi r th
or agf Sub -landlord shall be personally
KN
ith this Sublease. In no event shall
advisers or agents be
or incurred by Subtenant, including, without
on of Subtenant's business.
Section
18. Jury Trial Waiver
SUB -LANDLORD AND SUBTENANT HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BY EITHER OF THEM AGAINST THE OTHER ARISING OUT OF OR IN CONNECTION
WITH THIS SUBLEASE, SUBTENANT'S USE OR OCCUPANCY OF THE SUBLEASED PREMISES, OR
ANY CLAIM OF INJURY OR DAMAGE OCCURRING IN OR ABOUT THE SUBLEASED PREMISES.
Section
19. Reserved
Section
20. Brokers
Subtenant represents and warrants to Sub -landlord that no real estate broker, agent or finder
negotiated or was instrumental in negotiating or representing Subtenant in the negotiation of