Steve Durrett of Six Romeo Mike, LLC,  desires to enter into a new Non-Commercial Aviation Ground Lease and to construct a new 60' x 60' hangar on the leased parcel addressed as 2445 Overlook Drive. This Lease is for a 13,440-square foot parcel located in the executive hangar area on the west end of the Airport. The Lease is for twenty years, commencing October 1, 2012, and terminating on September 30, 2032. 

Additionally, Mr. Durrett will be financing the construction of this new hangar through Stockman Bank. Stockman Bank is requesting an Assignment of Six Romeo Mike's interest in the Lease to secure the new financing arrangements. The Assignment language has been reviewed by both staff and the City Attorney, and is similar to language used in the past. The City has approved a number of these financing assignments over the years as a means for the banks to secure the loans they provide to the Airport tenants for either construction or purchase of their on site facilities.

Copies of both the Lease and the Lessor's Consent to Assignment of Lessee's Interest in Lease to Secure a Bank Loan are on file in the City Clerk's Office.

The City Council may:

• Approve the twenty-year Ground Lease to Six Romeo Mike, LLC for a new 60' x 60' executive hangar and the accompanying Lessor's Consent to Assignment; or
• Not approve the twenty-year Ground Lease to Six Romeo Mike, LLC for a new 60' x 60' executive hangar and the accompanying Lessor's Consent to Assignment.

The first year of this Lease will generate $3,494.40 of revenue for the City's Airport. Subsequent years will be adjusted using the Department of Labor Consumer Price Index - Urban Consumers (CPI-U) for the previous twelve months to keep pace with annual inflation.

Staff recommends that City Council approve the twenty-year Non-Commercial Aviation Ground Lease to Six Romeo Mike, LLC, for the term beginning October 1, 2012 and terminating on September 30, 2032, and the Lessor's Consent to Assignment to Stockman Bank, to secure the bank's financing to Six Romeo Mike for its new hangar construction at the Airport.