Adopt Resolution #21-332 Approving Lease with Mille Lacs Motor Sports II, Inc. for Outside Storage at 6701 Hwy 10 NW

Mille Lacs Motor Sports (Power Lodge) has requested extension of the lease behind the building at 6701 Hwy 10 for temporary storage of boats and inventory for its business.   This is a request for a temporary storage as Mille Lacs is working on a permanent solution for their business over the next few years.  The timing of lease works well with the proposed improvements coming to Hwy 10 as it concludes just prior to its completion. Staff has worked with Premier Commercial Properties and Mille Lacs Motor Sports to draft a lease agreement for a 2.5 year period.  The City Attorney has approved this lease as to form. The proposed lease rate is $0.62 / SF with 3% annual inflation built in. The use makes sense with Mille Lacs also requesting to lease the rear 18,200 SF for their operations.  Staff supports the request to assist a growing Ramsey business.

N/A

Observations:

The Terms of the lease are straight forward. Here are some of the specifics:

1. Lease.  Landlord leases to Tenant the area outlined in Exhibits A and B along the rear property line of the property located at 6701 Highway 10 (PID 34-32-25-12-0009) (the Leased Area).
2. Term and Rent.  
   Lease Period 1- December 1, 2021 – May 31, 2022 - $373.89 / month
   Lease Period 2 – June 1, 2022 – May 31, 2023 - $385.11 / month
   Option (Lease Period 3) June 1, 2023 – May 31 2024 - $396.66 / month
3. Use.  The Leased Area may only be used for storage of Tenant’s inventory and/or customer’s boats.  The Leased Area may not be used for employee parking or any other use without Landlord’s written permission.  No signage shall be installed by Tenant in or on the Leased Area.  Tenant shall conduct its business and control its agents, employees, invitees and visitors in such a manner as not to create waste, odors, nuisance, or interfere with, annoy or disturb any other tenant of Landlord or Landlord’s employees and agents in its operation of the 6701 Highway 10 property.  Tenant acknowledges that the Leased Area is not fenced except along the rear of the property or otherwise secured in any manner and Landlord makes no representations as to the security of the Leased Area.
4. Access.  To the extent reasonably practicable, the Leased Area shall be accessed by Tenant through the gate on the east fence of Outdoor Storage Area D located at the rear of 6745 Highway 10.  A 15-foot-wide through lane between the rear of the building at 6701 Highway 10 and the Leased Area must be maintained at all times for emergency vehicle access and for City access to the rear of the 6701 building.

Alternatives:

1. Approve Lease Agreement, as presented
2. Approve Lease Agreement, with modifications
3. Something else

N/A. 

Staff supports the proposed lease agreement as presented and recommends adoption of Resolution #21-332 as presented; subject to City Attorney review.

Motion to adopt Resolution #21-332 Approving Lease with Mille Lacs Motor Sports II, Inc. for Outside Storage at 6701 Hwy 10 NW; subject to City Attorney review.