HomeMy WebLinkAbout13.A.1. Chamber of Commerce Building Discussion CITY OF SHAKOPEE
Memorandum
TO: Mayor and City Council
Mark McNeill, City Administrator
FROM: Kris Wilson, Assistant City Administratorio
SUBJECT: Chamber of Commerce Building
MEETING DATE: May 17, 2011
INTRODUCTION:
The Shakopee Chamber of Commerce / Convention and Visitors Bureau has requested some
time before the City Council to discuss and gather feedback regarding the future of the Chamber
offices.
BACKGROUND:
The Shakopee Chamber of Commerce / Convention and Visitors Bureau currently has its offices
in a building located within Memorial Park. The building was built and is owned by the
Chamber, but they lease the land it sits on from the City. The 1533 square foot building was
built in 1987 and is currently valued at $140,000 by the Scott County Assessor's Office. The
building is too small for the Chamber's current needs, and is in need of some significant
improvements to remain viable for an extended period of time.
The agreement which the City has with the Chamber for this purpose is attached. As shown, in
the event that the agreement is terminated, the Chamber has a responsibility to remove the
structure, and restore the site to its original condition. It should also be noted that the park
property which is covered in the lease is significantly larger than the footprint of the building.
Finally, when doing research for this issue, it was discovered that a portion of the building is not
within the leasehold footprint.
The Chamber is currently evaluating its space needs and contemplating various repairs and /or
potential improvements to building, as well as the possibility of moving to another location.
Before they make any decisions, they would like input from the City Council regarding what
may or may not be acceptable to the City as the owner of the underlying land. Such issues
include:
1. Will the City consider approving an expansion of the current building?
2. Would the City be interested in the building for its own purposes, should the Chamber
choose to move its operations to another location? If so, would the City consider a
purchase of the building at fair market value?
3. Will the City require site restoration at Chamber expense, in the event that the building is
moved?
4. Would the city allow for the Chamber to lease or sell the building to another user, given
the limited number of uses which might be allowable in the underlying zoning—
Agricultural Preservation (church, or public or private school with CUP, or a riding
academy, kennel, or daycare center)?
5. Others?
REQUESTED ACTION:
The Council is asked to listen the Chamber's presentation and provide feedback.
LEASE AGREEMENT
THIS INDENTURE, made this -mow', day of 1987, by
and between the City of Shakopee, a Minnesota municipal
corporation (hereinafter designated and referred to as "Lessor "),
and Shakopee Chamber of Commerce, a Minnesota non - profit
corporation (hereinafter designated and referred to as "Tenant ").
WITNESSETH:
WHEREAS, Lessor is the owner of the fee title to the
land located in the County of Scott, State of Minnesota, legally
described on Exhibit A attached hereto and made a part hereof and
the improvements to be constructed thereon (said land and
improvements) being hereinafter (referred as "Premises" or
"Demised Premises "); and,
WHEREAS, Lessor desires to lease said Premises to Tenant,
and Tenant desires to hire and take the Premises from the Lessor.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, and for further good and valuable
consideration which each of the parties hereto acknowledge as
adequate and sufficient, the parties hereto agree as follows:
ARTICLE I.
DEMISING CLAUSE
1.1 Lessor, for and in consideration of the rents herein
reserved, and the covenants and agreements herein contained on
the part of the Tenant to be kept, observed and performed, does,
by these presents, demise and lease to Tenant, and Tenant hereby
hires and Lets from Lessor, the Demised Premises, all in
accordance with the terms, covenants and conditions herein set
forth.
(1)
1.2 Tenant shall have and hold the Demised Premises, and
all improvements now or hereafter constructed thereon as they
shall be, as of the date hereof, without any liability or
obligation on the part of Lessor to make any alterations,
improvements or repairs of any kind on or about said Demised
Premises for the term of the within Lease. Tenant agrees to
maintain the Demised Premises and all parts thereof in good and
sufficient state of repair.
ARTICLE II.
TERM
2.1 The term of this Lease shall commence on the 1st day
of May 1987 and shall continue thereafter through and
inclusive to 12:00 o'clock noon on the 30th day of May
2037, unless sooner terminated as herein set :Fourth.
ARTICLE III.
RENTAL
3.1 In consideration of the leasing, aforesaid, and
provided said use as set forth in Article IV. continues, Tenant
agrees to pay to Lessor at Shakopee City Hall, total rental in
the sum and amount of one and no /100 Dollars($1.00).
ARTICLE IV.
USE
4.1 The Demised Premises shall be used for purposes of a
Chamber Office, Convention Bureau and Tourist Information Center
and such other and similar uses and for such activities as may be
lawfully carried on, in and about the Demised Premises. Tenant
shall not use or occupy the Demised Premises or knowingly permit
the Demised Premises to be used or occupied contrary to any
statute, rule, ordinance, requirement or regulation applicable
thereto, or in any manner which would substantially diminish the
value or usefulness of the Demised Premises or any part thereof.
ARTICLE V.
INSURANCE
5.1 The Tenant shall, at the Tenant's sole cost and
expense, keep all buildings or structures erected upon the
Demised Premises, and fixtures therein, equivalent to the full
replacement value thereof against (a) loss or damage by fire and
(b) such other risks, of a similar or dissimilar nature, as are
or shall be customarily covered with respect to buildings or
structures similar in construction, general location, use and
(2)
ccupancy, including, but without limiting the generality of the
foregoing, windstorm, hail, explosion, vandalism, riot and civil,
commotion, damage from vehicles and smoke damage and such other
coverage as may be deemed necessary by the Lessor, providing such
additional coverage is obtainable and provided such additional
coverage is such as is customarily covered with respect to
buildings and structures similar in construction, general
location, use and occupancy as are, or shall be, constructed on
the Demised Premises. These insurance provisions shall in no way
limit or modify any off the obligations of the Tenant under any
of the terms or provisions of this Lease.
5.2 The Tenant shall also, at the Tenant's sole cost and
expense, but for the mutual benefit of the Lessor and the Tenant,
maintain (a) general public liability insurance against claims
for personal injury, death or property damage occurring upon, in,
or about the Demised Premises and on, in or about the adjoining
lands, streets and passageways, such insurance to afford
protection to the limit of not less than the maximum amount for
which claim may be made against a municipality, which at the time
this Lease is entered into as Six Hundred Thousand and no /100
Dollars ($600,000.00) per person and Six Hundred Thousand and
no /100 Dollars ($600,000.00) per incident. Should that amount be
changed by the legislature the Tenant will provide insurance
affording protection to the Lessor in the new amounts. Should by
Court action the limitations on amounts of claims that may be
made against a municipality be removed, the Tenant shall provide
such amounts of insurance as the Lessor shall from time to time
by written notice require. Moreover, should the Lessor determine
that it is in its best interest to require Tenant to provide
insurance over and above the amounts hereinbefore set forth, the
Lessor shall give Tenant written notice thereof and the Tenant
shall provide proof of such additional insurance within thirty
(30) days of said written notice.
5.3 All policies of insurance relating to fire, windstorm
and similar coverage shall name the Lessor as the co- insured.
5.4 All policies of insurance shall be written in companies
satisfactory to the Lessor and shall be written in such form and
shall be distributed in such companies as shall be reasonably
acceptable to the Lessor. Said policies shall be delivered to
the Lessor endorsed "premium paid" by the company or agency
issuing the same or accompanied by other evidence satisfactory to
the Lessor that the premiums thereon have been paid, not less
than ten (10) days prior to the expiration of any then current
policies. Said policies shall also contain language whereby the
Lessor shall be notified in writing by the insurer of any
cancellation of said policy.
5.5 The Tenant shall insure the contents of any building or
(3)
ructure occupied by the Tenant, against loss or damage by fire,
windstorm or other casualty for such amount as Tenant may desire
and Tenant agrees that such policy shall contain a waiver of
subrogation clause as to the Lessor. The Tenant waives, releases
and discharges Lessor for all claims or demands whatsoever which
Tenant may have or acquire in the future, arising out of damage
to the destruction of Tenant's contents occasioned by fire or.
extended coverage risk whether such claim or demand may arise
because of the negligence of the Lessor, its agents or employees
or otherwise, and Tenant agrees to look to insurance coverage
only in the event of such loss.
ARTICLE VI.
UTILITIES
6.1 It is further agreed that Tenant will pay for all
charges for water, electricity, light, heat, gas, power, sewer or
other utilities furnished to said premises. Tenant assumes all
risks upon availability or interruption of such utility services
except for causes within the reasonable control of Lessor. The
rent and other obligations hereunder shall not abate, and this
Lease shall not terminate as a result of unavailability or
interruption of said utilities.
ARTICLE VII.
REPAIRS
7.1 The Tenant covenants throughout the terms of this Lease
and any renewal terms, at the Tenant's sole cost and expense, to
take good care of the Demised Premises, including the buildings
and improvements now or at any time erected thereon, the
equipment, fixtures, motors and machinery thereof, the sidewalks,
curbs, roadways, parking areas and fences, and to keep the same
in good order and condition, and shall promptly, at the Tenant's
own cost and expense, make all necessary repairs, interior and
exterior, structural maintenance, ordinary as well as
extraordinary, foreseen as well as unforeseen, including
specifically, but not by way of limitation, all repairs made
necessary by the use made by Tenant of the Premises. When used
in this provision, the term "repairs" shall include replacements
or renewals when necessary, and all such repairs made by the
tenant shall be equal in quality and class to the original work.
The Tenant shall keep and maintain all portions of the Demises
Premises and the sidewalks adjoining the same in a clean and
orderly condition, free of accumulation of dirt, rubbish, snow
and ice.
(4)
ARTICLE VIII.
COMPLIANCE WITH LAWS
8.1 The Tenant covenants through the term of this Lease, at
the Tenant's sole cost and expense, promptly to comply with all
laws and ordinances and the orders, rules, regulations and
requirements of all federal, state and municipal P governments and
appropriate departments, commissions, boards and officers
thereof, and the orders, rules and regulations of the Board of `
Fire Underwriters where the Demised Premises are situated, or any
other body now or hereafter constituted exercising similar
functions, foreseen or unforeseen, ordinary as We ll a 1
extraordinary ma y a pplicable the s
s
the fixture thereof and the sidewalks andDecu Premises if an ,
f any,
adjoining the Demised Premises or the use or manner of use of the
Demised Premises. The Tenant will likewise observe a
with the requirements of all and comply
policies of public liability, fire
and all other
Policies of insurance at any time in force with
respect to the building and improvements on the Demised Premises
and the equipment thereof.
ARTICLE IX. {
i
MECHANICS LIENS
9 .1 The Tenant shall not suffer or Permit
liens to be filed against the Demises or m echanics
part
thereof by reason of any work, labor, services or materials J
supplied or claimed to have been supplied to the Tenant.
fi
ARTICLE X.
INTENT OF PARTIES
10.1 It being the intention and
r
parties hereto that all costs or expenses ofsewhateverrcharacter
or kind, general and special, ordinary and extraordinary,
foreseen or unforeseen, and of every kind and nature whatsoever
that may be necessary in or about the operation of the demised
Premises, shall be paid by the Tenant.
10.2 The Tenant covenants and agrees that if it shall at any
time fail to pay any costs, as defined above, or take out
for, maintain or deliver any of the insurance pay
provided for, or shall, fail to make any Payment or perfo rm or perfo above
other act on its rm any
part to be made or performed as in this Lease �
Provided, then the Lessor may, but shall not be obligated so to
do, and without notice to or demand upon the Tenant and without
waiving or releasing the tenant from any obligations of the
(S)
i ) �;
tenant in this Lease contained, pay any such imposition, effect
any such insurance coverage and pay premiums therefor, and may
make any other payment or perform any other act on the part of
the Tenant to be made and performed as in this Lease provided, in
such manner and to such extent as the Lessor may deem desirable,
and in exercising any such right to pay necessary and incidental
costs and expenses, employ counsel and incur and pay reasonable
attorneys fees. All sums so paid by the Lessor and all necessary
and incidental costs and expenses in connection with he
performance of any such act by the Lessor shall be payable to the
Lessor on demand, together with interest thereon at the lessor
rate of twelve (12a) percent per annum or the maximum permitted
by law from the date of making of such expenditure by Lessor.
ARTICLE XI.
DEFAULTS OF TENANT
11.1 If, during the initial term of this Lease or any
renewal term (a) the Tenant shall fail to continue the use of the
Demised Premises, or (b) make an assignment for the benefit of
creditors, or (c) a voluntary petition be filed by the Tenant
under any law having for its purpose the adjudication of the
Tenant a bankrupt, or (d) a receiver by appointed for the
property of the Tenant by reason of insolvency of the Tenant, the
occurrence of any such contingency shall be deemed a breach of
the Lease and this Lease shall, ipso.facto upon the happening of
any of said contingencies be terminated and the same shall expire
as fully and completely as if the day of the happening of such
contingency were the date herein specifically fixed for the
expiration of the initial term or any renewal term, and the
Tenant will then quit and surrender the Demised Premises to the
Lessor, but the Tenant shall remain liable as hereinafter
provided.
11.2 If, during the initial term of this Lease or any
renewal term (a) the Tenant shall make default in fulfilling any
of the covenants of this Lease or (b) the Demised Premises shall
be heft vacant or deserted for a period of thirty (30) days or
(c) this Lease shall be signed or transferred in any manner, the
Lessor may give to the Tenant notice of any default or of a
happening of any contingencies in this paragraph referred to, and
if at the expiration of thirty (30) days after the service of
such notice, the default or contingency upon which said default
was based shall continue to exist, when the case of a default or
contingency which cannot with due diligence be cured within a
period of thirty (30) days, if the Tenant fails to proceed
promptly after the service of such notice and with all due
diligence to cure the same and thereafter to prosecute the curing
of such default with all due diligence (it being intended that in
connection with a default not susceptible of being cured with due
i
(6) I
�i
diligence e within thirty (30) days the time within which Tenant is `
to cure the same shall be extended for said period as may be #
necessary to complete the same with all due diligence), the
Lessor, at its option, may terminate this Lease and upon such
termination the Tenant shall quit and surrender the Demised
Premises to the Lessor, but the tenant shall remain liable as
hereinafter provided.
11.3 The specified remedies to which the Lessor may resort
under the terms of this Lease are accumulative and are not
intended to be exclusive of any other remedies or means of
redress to which the Lessor may be lawfully entitled in case of a
breach or threatened breach by the Tenant of any provisions of
this Lease. The failure of the Lessor to insist in any one or
more cases upon the strict performance of any of the covenants of
this Lease or to exercise any option herein contained shall not
be construed as a waiver or relinquishment for the future of such
covenant or option. In addition to the other remedies in this
Lease provided, the Lessor shall be entitled to the restraint by
injunction of the violation, or attempted or threatened
violation, of any of the covenants, conditions or provisions of
this Lease.
ARTICLE XII.
ASSIGNMENT
12.1 The Tenant shall not assign this Lease, either in whole
or in part, nor sublet or mortgage the leasehold interest of
Tenant or any part or parts thereof, without prior written
consent of the Lessor, which consent will be given, if at all,
only to an assignment of this Lease to a non - profit corporation
or entity. This condition shall not prevent the Tenant from
leasing space within the Demised Premises on an hourly or similar
basis for purposes connected with the use of the Demised Premises
as a Chamber office, Convention Bureau and Tourist Information
Center.
ARTICLE XIII.
SIGNS
13.1 Tenant may erect such signs as it may deem desirable,
as long as said signs do not violate the laws of the municipality
in which the Demised Premises is situated.
(7)
ARTICLE XIV.
MISCELLANEOUS
14.1 The Tenant covenants not to do or suffer any waste or
damage, disfigurement or injury to any building or improvement
now or hereafter on the Demised Premises, or the fixtures and
equipment thereof.
14.2 The Tenant agrees to permit the Lessor, or its
authorized representatives to enter upon the Demised Premises at
all reasonable times for the purpose of inspecting the same and
making necessary repairs to any facility on the Demised Premises
which the Lessor maintains or operates.
14.3 The Tenant hereby agrees to indemnify and save harmless
the Lessor against and from any and all claims by or on behalf of
any person or persons or firm or firms, arising from the conduct
or management of or from any work or thing whatsoever done in or
about the Demised Premises. Tenant further acknowledges that no
representation, express or implied, has been made by Lessor as to
the suitability of the Demised Premises to be used by the Tenant.
14.4 All notices, demands and requests which may or are
required to be given by either party to the other shall be in
writing. All notices, demands and requests by the Lessor to the
Tenant shall be mailed by United States Mail, postage prepaid,
addressed to the Tenant at the Demises Premises. All notices,
demands and requests by the Tenant to the Lessor shall be sent by
United States Mail, postage prepaid, addressed to the Lessor, at
Shakopee City Hall, Shakopee, Minnesota.
14.5 The Tenant, in the use and occupancy of the Demised
premises and in the conduct of any business therein, shall comply
with the requirements of all laws, orders, ordinances, rules and
regulations of the federal, state, county and municipal
authorities. The Tenant covenants that it will not use or permit
to be used any part of the Demised Premises for any dangerous,
noxious or offensive trade or business and will neither cause nor
suffer any nuisance in, at or on the Demised Premises.
14.6 The Tenant shall, upon termination of this Lease, for
any reason whatsoever surrender to the Lessor the buildings,
structures, fixtures and building equipment upon the Demised
Premises, together with all additions, alterations and
replacements hereof.
14.7 The Tenant shall., upon mutual termination of this Lease
for purposes of relocating Tenant's building and equipment, be
permitted to relocate and shall return the premises to its
original state at no cost to Lessor.
(81
f
14.8 The covenants and agreements herein contained shall
ind and insure to the benefit of the Lessor, its successors and
assigns, and the Tenant and its permitted successors and assigns.
14.9 If any term or provision of this Lease shall to any
extent be invalid or unenforceable, the remaining terms and
provisions of this Lease shall not be effected thereby, but each
term and provision of this Lease shall be valid and enforced to
the fullest extent permitted by law. This Lease shall be
constructed and enforced in accordance with the laws of the State
of Minnesota.
ARTICLE XV.
RENEWAL
15.1 This Lease may be extended for additional. five (5) year
periods according to the same terms and conditions by written
mutual agreement of the parties. hereto.
ARTICLE XVI.
WAIVER OF MECHANICS LIEN
16.1 Before commending any improvement to the Premises, or
allowing any materials, labor or services to be supplied for
improvement to the Premises, the Tenant shall provide the Lessor
with mechanic lien waivers properly executed by all suppliers of
labor and /or materials. Failure of the Tenant to provide said
waivers shall constitute a breach of this lease Agreement and
shall entitle the Lessor to any and all remedies hereinbefore set
forth.
ARTICLE XVII.
NOTICE
17.1 During the term of this Lease and any extension
thereof, Tenant shall cause to be posted in a conspicuous place
on the Premises, and in a manner clearly visible to the public, i
notice stating that the Lessor, the City of Shakopee, is not
responsible for the cost of any labor, materials or supplies
provided for use or improvement of the Premises.
(9)
IN WITNESS WHEREOF, each of the parties hereto has caused
his Lease to be duly executed as of the day and year first above
written.
CITY ?on SHAKOPEE
s
By
El Rei ke, Mayor
By �-�-
"JaTzn Ander on/ 01�' Administrator
B t
�.� / ,
Judith S. Cox, Ci Clerk
This instrument was SHAKOPEE CHAMBER OF COMMERCE
drafted by: / r
. �
Julius A. Coller, II BY
s Pr ident
211 W. 1st Avenue
Shakopee, MN 55379
Its Secreitdry
Appr�zyed as to form this day
of 1987
CityVtttorne y
STATE OF MINNESOTA)
) ss
COUNTY OF SCOTT )
The regoing instrument was acknowledged before .me this ;
day 0 0 1987, by Eldon Reinke, John Anderson--an-d"-7
Judith Cox, respectively the Mayor, the City Administrator and
the Ci Clerk of the City of Shakopee, a Minneso a municipal l
co -of the co ation.
p
Carafes A. ht�ndrr
42 Notary Public
STATE OF MINNESOTA)
COUNTY OF SCOTT )
ss
The foregoing instrument was acknowledged before me this / 4 ,
day of �h .�� ,,• 1987, by / , �, �, .:�w and t;, r,�ax c,�' r` r, , ,�s !'y '4"
respectively the. and the Secrey tar of Shakopee Chamber `"
of Commerce, a Minnesota profit corporation, on behalf of the
corporation,,..-__� -:
ALAN
;. x:' CjOihRY Ff:ztiC —MINNcSO�. =.
t COU
jJiy cormissian ex; sr .Ds Dec. 16, iw� .
Notary Public
'7777 0
EXHIBIT A
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That part of the Northwest Quarter of the Northwest Quarter of {
Section 5, Township 115, Range 23, Scott County, Minnesota, i
described as follows:
at the point where the West line of the Northwest
Commencing �.
Quarter of the Northwest Quarter intersects the North Right -of-
Way of Trunk Highway No. 101 , thence in an Easterly No. 10}1oa I
along the North Right -of -Way line of said Trunk Highway i the
distance of 152.0 feet to the actual point of beginning 01280
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property to be described; s oibass th bea North
ng 68.0 feet thence�North on i
feet, thence Eas
assumed be 127.0 feet, thence East on assumed bearing 170• + feet to the North
feet, thence South on assumed ba Nno. 101,O thence Westerly along
Right --of -Way line of Trunk Highw Y
said North Right -of� -Way line of Trunk Highway Na. 101 to the
point of beginning.
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