On July 23, 2007, Alpine Aviation, Inc. DBA Alpine Air entered into a five year Limited Commercial Aviation Building and Ground Lease with the City of Billings, on a parcel located in the Airport Business Park and referred to as Hangar IP-5. On September 22, 2008, the Council approved Amendment One to the Lease with Alpine Air to add square footage to its leased premises to allow Alpine Air to construct additional office space in the hangar. Currently, Alpine Air leases 11,450 square feet of hangar and office space in IP-5. Alpine Air recently completed significant improvements to the interior of the leased hangar space, which includes an office remodel, cleaning and painting the hangar floor, and painting all the interior walls. Alpine Air has requested an extension to the Lease in order to have additional time over which to amortize the cost of these improvements. This Amendment adds an additional five years to the term of the Lease, extending the Lease expiration to October 31, 2017.  All other terms and conditions of the Lease remain unchanged.

The Council may:

• Approve Amendment Two to the Lease with Alpine Air; or
• Not approve Amendment Two to the Lease with Alpine Air.
   

There is no immediate financial impact to the City from this Amendment. However, the extension will provide for an additional five years of rental income in the future. The current annual rental is $19,945.92. The annual rental amount is adjusted each year according to the Consumer Price Index for all Urban Consumers (CPI-U) for the previous twelve months.

Staff recommends that Council approve Amendment Two to the Limited Commercial Aviation Building and Ground Lease with Alpine Aviation, Inc. DBA Alpine Air, which extends the present lease five (5) years to October 31, 2017.