Meeting_Body
FINANCE, BUDGET AND AUDIT COMMITTEE
SEPTEMBER 15, 2021
Subject
SUBJECT: FIFTH AMENDMENT TO LEASE AGREEMENT WITH BALDWIN STOCKER, LLC, FOR THE MICROWAVE RADIO STATION LOCATED AT LA CIENEGA BOULEVARD AND STOCKER STREET IN LOS ANGELES
Action
ACTION: APPROVE RECOMMENDATIONS
Heading
RECOMMENDATION
Title
AUTHORIZE the Chief Executive Officer (CEO) or their designee to execute a ten (10)-year, Fifth Amendment to the Lease ("Amendment") commencing January 1, 2022, with Baldwin Stocker, LLC, ("Lessor") for the microwave radio station located at the Baldwin Hills Oil Field at La Cienega Boulevard and Stocker Street in Los Angeles at a rate of approximately $46,465 per year with CPI escalations annually for a total of $508,780 over the ten-year term.
Issue
ISSUE
Metro must maintain its radio tower on property leased at the Baldwin Hills Oil Field in Los Angeles ("Tower") to maintain rail and bus communications throughout Metro's transportation systems.
Background
BACKGROUND
In 1992, Metro constructed a microwave relay radio facility at the Baldwin Hills Oil Field for continuity of communications with rail and bus operators and has been leasing the property from Baldwin Stocker, LLC ("Lessor") continuously ever since. The lease has been amended four times to extend the term, which expires on December 31, 2021. Metro's Operations & Service Delivery staff has confirmed that Metro continues to need this location for the next ten years.
Discussion
DISCUSSION
Findings
The annual rental rate of $46,465 commencing January 1, 2022, with annual CPI rent increases, is below the average lease rate of what Metro pays for other cell tower leases on an annual basis. A Broker's Opinion of Value by John Potts, Executive Officer, Real Estate (licensed real estate broker #01787671), determined that this lease rate is based on the current condition of the property and comparable rental rates and is within market rate.
Considerations
Due to the Tower's ...
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