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AGENDA
Transportation Committee Regular Meeting
4:30 PM - Monday, March 6, 2017
Council Conference Room, 7th Floor, City Hall – 1055 S. Grady Way
1. NORTHWEST SEAPLANES, INC. ADDENDUM 11-16
a) AB - 1847 Transportation Systems Division recommends approval of Addendum 11-16 to
LAG-91-005, with Northwest Seaplanes, Inc. for a ground lease rate adjustment from
$0.62 per square foot per year to $0.7252 per square foot per year, effective January 1,
2017 through December 31, 2022.
2. SUNSET LANE ROADWAY CLOSURES/DETOURS
Briefing
3. EMERGING ISSUES IN TRANSPORTATION
Including Airport Control Tower Construction
AB - 1847
City Council Regular Meeting - 13 Feb 2017
SUBJECT/TITLE: Northwest Seaplanes, Inc. Addendum 11-16
RECOMMENDED ACTION: Refer to Transportation (Aviation) Committee
DEPARTMENT: Transportation Systems Division
STAFF CONTACT: Harry Barrett, Jr, Airport Manager
EXT.: 7477
FISCAL IMPACT SUMMARY:
Airport annual revenue increase of $9,630.60 for the 860 West Perimeter Road leased parcel on the Airport.
Total new annual revenue for this lease is $66,388.85.
SUMMARY OF ACTION:
Northwest Seaplanes, Inc. has a ground lease for the tenant owned building at 860 West Perimeter Road.
Northwest Seaplanes lease LAG-91-005 allows for a periodic ground lease rate adjustment every five years.
The next periodic ground lease adjustment period is effective January 1, 2017 and will continue until
December 31, 2022.
Northwest Seaplanes, Inc. was notified by certified letter on October 6, 2016 of the City’s intent to adjust the
annual ground lease rate effective January 1, 2017. The method used to adjust the rate was based on the Pro-
Flight Aviation lease arbitration process that established the ground lease rate of $0.7252 per square foot per
year. This rate is the current standard ground lease rate for all Airport leases.
An addendum to Northwest Seaplanes lease to increase the ground lease rate from $0.62 per square foot per
year to $0.7252 per square foot per year for the 91,545.57 square feet of leased ground space was drafted
and approved by legal counsel. This ground lease rate is in effect until December 31, 2022. The Northwest
Seaplanes, Inc. lease expires on December 31, 2029.
EXHIBITS:
A. Addendum 11-16 to Lease LAG-005-91
STAFF RECOMMENDATION:
Authorize the Mayor and City Clerk to execute Addendum 11-16 to lease LAG-91-005 with Northwest
Seaplanes, Inc. for a periodic ground lease rate adjustment that will increase the ground lease rate from $0.62
per square foot per year to $0.7252 per square foot per year for the 91,545.57 square feet of leased ground
space effective January 1, 2017.
AGENDA ITEM #1. a)
LAG005-91
Addendum 11-16
ADDENDUMTO LEASEAGREEMENT
(City of Renton to Northwest Seaplanes,Inc.)
THIS ADDENDUMto Lease Agreement LAGO05-91 is effective as ofJanuary 1,
2017.
RECITALS:
WHEREAS,under lease LAG005-91,effective January 1,1992,the City of Renton
(Lessor)had leased to Northwest Seaplanes,Inc.(Lessee )certain land on the Renton
Municipal Airport,Renton,Washington,until December 31,2029;and
WHEREAS,on January 1,2012,the land rental rate for the approximately
91,545.57 square feet of land area leased by Northwest Seaplanes,Inc.was determined
to be $0.62 per square foot per year and continuing until January 1,2017;and
WHEREAS,pursuant to LAG005-91,Addendum 9-07,in a letter dated October 6,
2016,Lessee was notified by certified letter that the lease rate would be readjusted
using a means other than the Consumer Price Index-Urban;and
WHEREAS,on January 8,2015,a new land rental rate was established,through
the lease arbitration process,at a rate of $07252 per square foot per year;and
WHEREAS,on January 1,2017,the land rental rate is being adjusted using the
lease arbitration process,to a rate of $07252 per square foot per year for the
91,545.57 square feet of leased land,resulting in an annual rental amount of
$66,388.85 (91,545.57 x $0.7252),and a monthly rental rate of five thousand five
hundred thirty two dollars and forty cents ($5,532.40)($66,388.85/12=$5,532.40)and
continuing until December 31,2022.
NOW,THEREFORE,IN CONSIDERATIONOF THE TERMSAND CONDITIONSHEREIN
CONTAINED AND FOR OTHER GOOD AND VALUABLECONSIDERATION,THE RECEIPT
AND SUFFICIENCYOF WHICH IS HEREBYACKNOWLEDGED,LESSORAND LESSEEAGREE
TO AMEND THE LEASEAND LEASEADDENDAAS SET FORTH BELOW:
WITNESSETH:
1.Effective on the date of this addendum,section 3.1.2:of LAG005-91,is hereby
added as follows:
LLeaseAgreementLAG005-91 0 RlGlNA
City of Renton to Northwest Seaplanes,Inc.
AGENDA ITEM #1. a)
LAG005-91
Addendum 11~16
3.1.3.Periodic Rental Ad'ustment:Lessor and Lessee do hereby agree that the
Lessee shall pay to Landlord a Minimum Monthly Rent in the sum of five
N thousand five hundred thirty two dollars and forty cents ($5,532.40),which
amount is one-twelfth of the Total Annual Rent,without deduction,offset,prior
notice or demand,payable promptly in advance on the first day of each and
every month during the Term.Allsuch payments shall be made to the City of
Renton,Renton Municipal Airport,616 West Perimeter Road —Unit A,Renton,
Washington 98057.
2.Allother terms and conditions of the original Lease Agreement and Addenda
thereto,insofar as they are not inconsistent herewith,shall remain in full force and
effect.
Northwest Seaplanes,Inc.CITYOF RENTON
a Washington Corporation a Municipal Corporation
Denis Law
Mayor
Title Jason Seth
City Clerk
Date
Approved as to legal form
City Attorney
Lease Agreement LAG O05-91
City ofRenton to Northwest Seaplanes,Inc.
AGENDA ITEM #1. a)