Consent 1.B.
Regular City Council Meeting
- Meeting Date:
- 05/11/2015
- TITLE
- Assignment and Transfer of West End Hangar Ground Lease from B & J Properties Limited, LLC to KW Air, LLC
- PRESENTED BY:
- Tom Binford
- Department:
- Airport
Presentation:
PROBLEM/ISSUE STATEMENT
On May 10, 2004, B & J Properties Limited, LLC entered into a twenty-year West End Hangar Ground Lease with the City of Billings and subsequently built a 3,600 square foot hangar on the leased parcel located at 2709 Overlook Drive, located on the west end of the Airport. The parcel contains 5,950 square feet. B & J Properties now desires to sell the hangar it owns and assign its Lease interest to KW Air, LLC. This Assignment and Transfer will formally transfer the lease on this parcel from B & J Properties Limited, LLC. to KW Air, LLC. Additionally, since the original 2004 ground Lease is outdated and requires updated language, the ground Lease is also being amended via Amendment One to reflect current standard lease language regarding market adjustments, specific privileges, insurance, and non-discrimination language. Amendment One will also extend the Lease term for approximately one additional year to provide a full ten years remaining on the term. The new expiration date is May 31, 2025. Copies of the Assignment and Transfer and Amendment One are on file in the City Clerk's Office.
ALTERNATIVES ANALYZED
City Council may:
- Approve the Assignment and Transfer of the West End Hangar Ground Lease from B & J Properties Limited, LLC to KW Air, LLC and Amendment One to the West End Hangar Ground Lease; or
- Disapprove the Assignment and Transfer of the West End Hangar Ground Lease and Amendment One to the West End Hangar Ground Lease.
FINANCIAL IMPACT
There is no financial impact from the Assignment and Transfer; the name on the Lease is all that changes with this action. Annual rent will continue to be adjusted annually on the anniversary date by the Department of Labor Consumer Price Index for All Urban Consumers (CPI-U), published by the Bureau of Labor Statistics, for the previous twelve months to keep pace with annual inflation.
RECOMMENDATION
Staff recommends that City Council approve the following: (1) Assignment and Transfer of the West End Hangar Ground Lease from B & J Properties Limited, LLC to KW Air, LLC, and (2) Amendment One to the West End Hangar Ground Lease.