|
Item 1.B.
|
| City Council Regular | |
| Date: | 04/14/2025 |
| Title: | West End Hangar Ground Lease with TFES 1167, LLC |
| Presented by: | Jeff Roach |
| Department: | Airport |
| Presentation: | No |
| Legal Review: | Template Contract |
| Project Number: | N/A |
RECOMMENDATION
Staff recommends that City Council approve the West End Hangar Ground Lease with TFES 1167, LLC for a 25-year term commencing April 1, 2025, and ending March 31, 2050.
BACKGROUND (Consistency with Adopted Plans and Policies, if applicable)
On February 14, 2022, City Council approved a West End Hangar Ground Lease with Beacon Air Group, LLC (Beacon) to construct the first hangar in the new West End Large Hangar Area. On March 28, 2022, City Council approved two additional West End Hangar Ground Leases with Beacon to construct two additional large hangars in the new West End Large Hangar Area. All of these hangar locations are on the west side of the taxilane. The Airport created this area specifically for space to construct large hangars to accommodate large corporate and private aircraft. The west row of ground parcels is now completely under lease and all hangars have been constructed. Only three parcels remain available on the east row in this area. On March 24, 2025, City Council approved two new West End Hangar Ground Leases with Beacon to construct the first two hangars on the east row of the taxilane. Kevin Button of Beacon desires to construct a third additional new 120 ft. x 100 ft. hangar in this West End Large Hangar Area, which will complete the leasing of available parcels in this row. Staff has worked with Mr. Button on the new twenty-five-year West End Hangar Ground Lease that commences April 1, 2025, and terminates March 31, 2050. The proposed leased premises include a 38,700 square foot parcel on the newly named street Jetway Drive. This hangar will be the sixth hangar Mr. Button will have constructed in the new West End Large Hangar Area. As part of the financing for this development, this lease will be leased under an intermediary entity – TFES 1167, LLC until site work and some construction is completed, after which time the lease will be assigned to Mr. Button's new entity – Imperial Investments, LLC. The tenant name will be the only change that will be made with the future assignment; all other terms and conditions will remain in full force and effect.
ALTERNATIVES
City Council may:
- Approve the West End Hangar Ground Lease with TFES 1167, LLC; or,
- Not Approve the West End Hangar Ground Lease with TFES 1167, LLC.
FISCAL EFFECTS
The initial annual rental for this lease will be $13,545. Lease rentals in subsequent years will be adjusted on an annual basis on the anniversary dates, using the average of the monthly percentage increases for the previous calendar year, as determined by the Department of Labor Consumer Price Index for All Urban Consumers (CPI-U), published by the Bureau of Labor Statistics.