That the City Council approve a long-term lease agreement with iTennis, Inc. to operate the La Habra Tennis Center. 

In July 2017, the City Council approved a lease for the management and operation of the City-owned La Habra Tennis Center facility at Portola Park to iTennis, Inc. following the previous operator's release of their lease. The lease with iTennis, Inc. among other things, required the contractor to be responsible for all:

Under the current lease, the City remains responsible for the maintenance of driveways, parking and landscaped areas.  The lease set a rental rate for the facility at $3,000 per month for August 2017 and then, in 2019, increased to $3,500 on a month-to-month basis to date. 

The City-owned Tennis Center facility is located at the City's 10-acre Portola Park site on Euclid Street. The park site includes a number of distinct public facilities and uses, including:

Portola Park is, by far, one of the City's most heavily utilized facilities and serves as the current location of the City's summer concerts and movies in the park, the annual Tamale Festival, the Police Department's National Night Out event, the back-to-school backpack giveaway, multiple Children's Museum special events, and most recently, the La Habra Host Lions Club Corn Festival, in addition to the La Habra City Little League's games and practices and the City's Child Development's daily programs for preschool and school-age children. Portola Park also serves as overflow parking for Brio Park across the street, which is heavily utilized during the summer months when the City's splash pad is in operation. Portola Park has hundreds of visitors using various facilities each day, all of whom share the common 138-space parking lot, which is often fully utilized, making it difficult for each distinct function at the park to concurrently operate at full capacity. 

At its Regular Meeting of December 2, 2024, City Council authorized staff to negotiate a long-term lease agreement with iTennis, Inc. with the goal of providing the City with an improved level of community benefits and lease revenue for City Council review and approval. Community Services Department staff met with the owners of iTennis, Inc. to better understand their lease request and capital improvement plans, and to communicate the City's desire to provide the best partnership possible for the benefit of the La Habra community. iTennis, Inc. has created a growing pickleball presence at the facility, along with a sustained tennis program, has consistently paid their monthly lease on time, and has made attempts to increase the number of La Habra residents using the facility. Staff have indicated an expectation that any leaseholder of this facility should be more community-friendly in providing options for La Habra residents, such as resident discounts, cooperative play agreements with the Recreation Division for La Habra senior citizens, allowances for community organizations and local school programs to use the facility, and improved coordination with the City regarding the joint uses that regularly occur at Portola Park. iTennis, Inc. management staff have acknowledged staff's focus and concerns and has indicated a willingness to accept adding provisions such as these to an extended contract. iTennis, Inc. is aware of staff concerns regarding the limited parking at Portola Park and has indicated a willingness to incorporate certain 'closed days' as part of the new lease agreement. 

City staff propose entering into a long-term lease agreement for an initial five-year term, with three additional five-year terms, not to exceed 20 years, with iTennis with the following conditions as outlined in Exhibit A: 

OPERATIONS: The operator, at its own cost and expense, shall operate and manage the La Habra Tennis Center in a professional manner, including memberships, court rentals, tennis and pickleball instruction, tennis and pickleball leagues and tennis and pickleball tournaments, pro shop and Tennis Center marketing program. The operator shall provide the following minimum services:

RECORDS MANAGEMENT:

SUBCONTRACTORS:

CAPITAL INVESTMENTS:

The new multi-year agreement will provide iTennis, Inc. the necessary time to recover the costs of these significant investments while ensuring the La Habra Tennis Center remains in optimal condition for the community. Their continued operation will maintain the quality and accessibility of pickleball and tennis programs for La Habra residents, fostering both recreation and community engagement. 

The long-term lease agreement will generate a steady revenue stream over the next twenty years. 

Years 1–5 ($5,500 per month x 12 months x 5 years) = $330,000
Years 6–10 ($6,500 per month x 12 months x 5 years) = $390,000
Years 11 - 20 ($6,500 + annual CPI x 12 months x 5 years) = To be determined

iTennis, Inc. is committed to making capital improvements to resurface the tennis courts ($77,000) and replace lighting with LED lighting ($148,000) for a total investment of $225,000 within the first two years of the agreement.