Legislation Details

File #: 11699   
Type: Consent Status: Passed
File created: 2/13/2025 Department: Real Estate Services
On agenda: 2/25/2025 Final action: 2/25/2025
Subject: Amendment to Lease Agreement with Blue Jay Retail, LLC for Library and Office Space in Blue Jay
Attachments: 1. R1-CON-RESD-LIB-022525-Lease Amd w Blue Jay Retail 03-474 A8, 2. Item #35 Executed BAI, 3. 3-474 A-8 Executed Contract

REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS

OF SAN BERNARDINO COUNTY

AND RECORD OF ACTION

 

February 25, 2025

 

FROM

TERRY W. THOMPSON, Director, Real Estate Services Department

MELANIE OROSCO, County Librarian, County Library

         

SUBJECT                      

Title                     

Amendment to Lease Agreement with Blue Jay Retail, LLC for Library and Office Space in Blue Jay

End

 

RECOMMENDATION(S)

Recommendation

1.                     Find that approval of Amendment No. 8 to Lease Agreement No. 03-474 with Blue Jay Retail, LLC, for library and office space, is an exempt project under the California Environmental Quality Act Guidelines, Section 15301 - Existing Facilities (Class 1).

2.                     Approve Amendment No. 8 to Lease Agreement No. 03-474 with Blue Jay Retail, LLC, through the use of an alternative procedure, as allowed per County Policy 12-02 - Leasing Privately Owned Real Property for County Use, to extend the term of the lease five additional years, by exercising the five-year option to extend, for the period of March 1, 2025, through February 28, 2030, following a permitted holdover period of June 1, 2024, through February 28, 2025, adjust the rent schedule, add one five-year option to extend the term of the lease and update standard lease agreement language, for approximately 5,513 square feet of library and office space at 27235 Highway 189 in Blue Jay, for the County Library, in the amount of $1,041,555, including the holdover amount of $125,554, for a new total amount of $3,209,403.

3.                     Direct the Real Estate Services Department to file the Notice of Exemption in accordance with the California Environmental Quality Act.

(Presenter: Terry W. Thompson, Director, 387-5000)

Body

 

COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES

Operate in a Fiscally-Responsible and Business-Like Manner.

Pursue County Goals and Objectives by Working with Other Agencies.

 

FINANCIAL IMPACT

Approval of Amendment No. 8 (Amendment) to Lease Agreement No. 03-474 (Lease) with Blue Jay Retail, LLC (BJR) will not require Discretionary General Funding (Net County Cost).  The total cost of this five-year Amendment is $1,041,555.  Lease payments will be made from the Real Estate Services Department (RESD) Rents budget (7810001000) and reimbursed from the County Library (Library) budget (64022152600), which is 100% funded by property tax.  Additional Lease costs include janitorial, maintenance, and utility expenses, which will be paid from the Library budget.  Sufficient appropriation is included in both the Library and RESD Rents 2024-25 budgets and will be included in future recommended budgets.  Annual Lease costs are as follows:

 

Year

Lease Cost

Additional Lease Cost

Total Lease Cost

*June 1, 2024 - February 28, 2025

$95,264

$30,290

$125,554

March 1, 2025 - February 28, 2026

$130,989

$41,567

$172,556

March 1, 2026 - February 28, 2027

$134,918

$42,814

$177,732

March 1, 2027 - February 29, 2028

$138,966

$44,098

$183,064

March 1, 2028 - February 28, 2029

$143,015

$45,421

$188,436

March 1, 2029 - February 28, 2030

$147,429

$46,784

$194,213

Total Cost

 

 

$1,041,555

*Permitted holdover period

 

BACKGROUND INFORMATION

On June 3, 2003 (Item No. 68), the Board of Supervisors (Board) approved the Lease with one three-year option and one two-year option to extend the term for 5,513 square feet of library and office space at 27235 Highway 189 in Blue Jay.  The original term was for the period of June 1, 2003, through May 31, 2008.  In the 20 years since the Lease was originally approved, the Board has approved seven amendments and extended the term through May 31, 2024, added options to extend, modified the rent, reflected changes in ownership, and updated standard lease agreement language.

 

Amendment No.

Approval Date

Item No.

1

November 20, 2007

38

2

October 21, 2008

39

3

May 17, 2011

55

4

May 21, 2013

49

5

May 19, 2015

61

6

April 19, 2016

54

7

May 21, 2019

89

 

In September 2024, RESD received approval from the Library to extend the Lease by five additional years and add one five-year option to extend the term.  Due to the ongoing negotiations between the County and the Landlord, the Lease has been extended into a holdover period.  RESD was able to negotiate a renewal of the Lease at the current rate for year one.  The recommended action will amend the Lease with BJR by extending the term five years by exercising the existing option to extend for the period of March 1, 2025, through February 28, 2030, adjust the rent schedule, add one five-year option to extend the term, and update standard lease agreement language due to the continuing need to provide library and office space for the Library in the Blue Jay area.  All other terms and conditions of the Lease remain unchanged.

 

The project to approve the Amendment was reviewed pursuant to the California Environmental Quality Act (CEQA) and determined to be categorically exempt under Section 15301 - Existing Facilities (Class 1) because there is no possibility that the leasing of the subject property will have a significant effect on the environment.

 

Summary of Lease Terms

Lessor:

Blue Jay Retail, LLC Peter Hollingshead, Managing Partner

 

 

Location:

27235 Highway 189, Blue Jay

 

 

Size:

5,513 square feet of library and office space

 

 

Term:

Five years commencing March 1, 2025

 

 

Options:

One five-year option

 

 

Rent:

Cost per sq. ft. per month

Monthly

Annual

 

$1.98

$10,916

$130,989

 

*Low-range for comparable facilities in the Blue Jay area per supporting lease comparable on file

 

 

Annual Increases:

3%

 

 

Improvement Costs:

None

 

 

Holdover:

Month to Month upon same terms and conditions of the Lease

 

 

Custodial:

Provided by County

 

 

Maintenance:

Lessor to provide exterior maintenance; County to provide interior maintenance

 

 

Utilities:

Lessor to provide trash disposal; County to provide all other utilities

 

 

Insurance:

The Certificate of Liability Insurance, as required by the lease, is on file with RESD

 

 

Right to Terminate:

County has the right to terminate with 90-days’ notice

 

 

Parking:

Sufficient for County needs

 

PROCUREMENT

Exceptions to County Policy 12-02, Leasing Privately Owned Real Property for County Use.  The Policy provides that the Board may approve the use of an alternative procedure to the use of a formal Request For Proposal (RFP) whenever the Board determines that compliance with the formal RFP requirements would unreasonably interfere with the financial or programmatic needs of the County, or when the use of an alternative procedure would otherwise be in the best interests of the County.  The Lease and continued occupancy of the Library best meets the needs of the County in providing uninterrupted public services to the population within the local service area.

 

REVIEW BY OTHERS

This item has been reviewed by County Counsel (John Tubbs II, and Daniella Hernandez, Deputies County Counsel, 387-5455) on January 3, 2025; Library (Melanie Orosco, County Librarian, 387-2220) on December 19, 2025; Purchasing (Ariel Gill, Supervising Buyer, 387-2070) on December 20, 2025; Finance (Elias Duenas, 387-4052, and Eduardo Mora, 387-4376, Administrative Analysts) on February 5, 2025; and County Finance and Administration (Paloma Hernandez-Barker, Deputy Executive Officer, 387-5423) on February 7, 2025.

 

(AR: 501-7579)