HomeMy WebLinkAboutItem #76 - Discussion ItemAMSTERDAM
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MELBOURNE
MEW,CO CITY
PEDRO A. MARTIN
1305)789.8903
BAKER & MgKENZI
ATTORNEYS AT LAW
SUITE 1600
BARNETT TOWER
701 BRICKELL AVENUE
MIAMI. FLORIDA 33131
TELEPHONE: 1305) 789-8900
CABLE: ABOGADOMIA - TELEX: 592386
FACSIMILE: (3051 789-8953
Mr. Cesar Odio
City Manager
' City of Miami
3500 Pan American Drive
Miami, Florida 33137
June 1, 1989
Submitted into the public
record in connection with
i tern _ on4�/
Matty Hirai
City Clerk
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Re: Proposed Lease and Option to Purchase (the "Lease")
between F.F. Fund Corp. ("Landlord") and the City of
Miami ("Tenant") of an office building located at 4400
Biscayne Boulevard, Miami, Florida
Dear Mr. Odio:
We represent the Landlord and its representative, Mr.
William Kadish, in connection with the proposed Lease. The
Landlord has authorized me to make the following proposal to you
which modifies and supersedes the Landlord's original offer of
April 21, 1989 and the modifications made at the meeting held at
your office on Thursday, May 18, 1989 as follows:
1. Property - The entire office building and
parking structure facilities
located at 4400 Biscayne
Blvd., Miami, Florida.
2. jerm - 25 Years
3. Lease
Commencement - July 1, 1989
�-.F e-+" .magi' • � k ,.+` `�
e
BAKER & 'I'V Ht ZIE
Mr. Cesar Odio
June 1, 1989
Page 2
4. $ase Rent (Free Parking)
During the first four years of
the lease term, commencing on
July 1, 1989 and terminating
on June 30, 1993, the Tenant
shall pay no rent.
-
During the succeeding one and
one half years, commencing on
July 1, 1993 and terminating
on December 31, 1994, the rent
shall be one million five
hundred thousand and no/100
dollars ($1,500,000.00) per
annum (payable monthly in
Submitted into the public
advance) , meaning that total
rent payments during the
in connection vrith
aforesaid period shall be two
record
million two hundred fifty
(' -7 R
thousand and no/100 dollars
item - on
($2, 250, 000.00) .
Matty Hirai
City Clerk -
During the remainder of the
lease term, commencing on
January 11 1995 and
terminating on June 30, 2014,
the base rent shall be two
million seven hundred seventy
five thousand. and no/100
dollars ($2,775,000.00) per
annum (payable monthly in
advance). Commencing on
January 1, 1996, the monthly
rent payments may increase
based on any CPT increase,
utilizing 1995 as the base
year for determining the
initial increase. The maximum
rent increase in any one year
of the lease term due to an
increase in the CPI shall be
two and three fourths percent
(2 3/4%).
5. Net Lease - Throughout the term of the
lease, the Tenant shall be
responsible for all taxes,
utilities, insurance, repairs,
maintenance, management and
all other operating expenses.
9-57 •.
BAKER & �I VKENZJE .
Mr. Cesar Odio
June 1, 1989
Page 3
6. Purchase
Option
Submitted into the public
record in connection with
itemSon (' t-7 I Fci
7.
Matty Edui
City Clerk
Tenant shall have an option to
purchase the property (non
assignable) by giving Landlord
notice at least 180 days
before closing based on the
following terms:
a) Purchase Price
$17,750,000 - Landlord shall
be entitled to interest at
fifty percent (50%) of the
Prevailing Citibank New York,
New York Prime Rate (not to
exceed five and three fourths
percent (5 3/4%) per annum) on
the aforesaid Purchase Price
from the lease commencement
date to Purchase closing date.
b) closing Date
On or before January 15, 1991
c) Title
Good, marketable and insurable
title, subject to restrictions,
limitations, reservations,
conditions and easements of
record; easements for public
utilities and applicable
zoning regulations.
Ground Floor Landlord offers the following
alternative lease proposal
which may be exercised at the
option of the Tenant prior to
the lease commencement date.
Rather than leasing the entire
building, the ground floor
would be retained by the
Landlord and the Lease to the
City would contain a
corresponding proportionate
rent reduction.
We believe that the lease terms and the option price
are fair and reasonable and are in the best interest of the City
of Miami. In the next few days I will be providing you with a
formal lease agreement and a report from the accounting firm of
BDO Seidman, discussing the economic analysis of our lease
proposal versus the construction of a building at the Government
9` sn-;L
Submitted into t � "Pl '.-slic
BAKER & Mr-REN7,1E
record in c^��.� tici c
Mr. Cesar Odio item on
June 1, 1989
Page 4 Matty Hirai
City Clerk
Center by the City of Miami. BDO Seidman is a very reputable
and internationally known accounting firm. Their analysis
indicates that under the proposed lease terms, it is better and
more cost effective for the City to lease the 4400 Biscayne
Blvd. building than to construct its own building at the
Government Center.
In addition, a copy of a current appraisal, prepared by
an "MAI" appraiser, J.A. MacCurdy & Assoc., Inc., will be given
to you which contains a current minimum market value for the
building of $25,000,000. Without considering a lease to the
City of Miami, the purchase price option afforded to the City is
an extremely fair and reasonable price compared to the current
appraisal of the property. As you know, this is an excellent
building which is risk -free in that, the City can move into the
building and take possession immediately without the cost
overruns and delays associated with building a new building such
as the one proposed at the Government Center. It will also
serve the purpose of consolidating City offices on an expedited
basis. Moreover, a decision by the City to move into the 4400
Biscayne Blvd. building should have a tremendous positive effect
in the surrounding community.
For all of the above reasons, we believe that it is in
the best interest of the City of Miami and the citizens of the
City of Miami to enter into the foregoing lease with an option
to purchase with the owners of the 4400 Biscayne Blvd. building.
The proposed terms of the Lease and option outlined
above are not intended to be binding on either party until a
formal Lease and option agreement is approved by the City of
Miami Commission.
If you have any questions in connection with the above,
please do not hesitate to contact me.
Very ly yours,
PEDRO A. MARTIN
MAF/871
cc: Hon. Xavier L. Suarez, Mayor
Hon. Victor H. De Yurre, Vice Mayor
Hon. Miller J. Dawkins, Commissioner
Hon. Rosario Kennedy, Commissioner
Hon. J. L. Plummer, Jr., Commissioner