REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
June 23, 2026
FROM
TERRY W. THOMPSON, Director, Real Estate Services Department
ARLENE MOLINA, Director, Preschool Services Department
SUBJECT
Title
Amendment to Lease Agreement with SoCal Hospitality & Investments, LLC for Unimproved Land and Parking Area in Rancho Cucamonga
End
RECOMMENDATION(S)
Recommendation
1. Find that approval of Amendment No. 4 to Lease Agreement No. 17-775 with SoCal Hospitality & Investments, LLC, for unimproved land and parking area, is an exempt project under the California Environmental Quality Act Guidelines, Section 15301 - Existing Facilities (Class 1).
2. Approve Amendment No. 4 to Lease Agreement No. 17-775 with SoCal Hospitality & Investments, LLC, utilizing an alternative procedure pursuant to County Policy 12-02 - Leasing Privately Owned Real Property for County Use, to:
a. Extend the term of the lease agreement by five years, from August 1, 2026 through July 31, 2031.
b. Adjust the rental rate schedule.
c. Continue leasing approximately 54,433 square feet of unimproved land and parking area at 9324 San Bernardino Road in Rancho Cucamonga, for the Preschool Services Department.
d. Increase the total lease amount by $762,912, from $731,022 to $1,493,934.
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.
Provide for the Safety, Health and Social Service Needs of County Residents.
FINANCIAL IMPACT
Approval of this item will not result in the use of Discretionary General Funding (Net County Cost). Preschool Services Department (PSD) lease costs are 84% federally funded and 16% state funded. The total cost of Amendment No. 4 (Amendment) to Lease Agreement No. 17-775 (Lease) with SoCal Hospitality & Investments, LLC (SoCal) is $762,912. Lease payments will be made from the Real Estate Services Department (RESD) Rents budget (7810001000) and reimbursed from PSD’s budget (5911452220). Other costs associated with this Lease include utilities, maintenance for the premises, and 50% of landlord’s routine maintenance costs for the shared access lanes at 9324 San Bernardino Road in Rancho Cucamonga (Premises), provided that the County’s share will not exceed $2,500 per Lease year. The County is also responsible for maintenance and custodial services for the County’s improvements at the Premises, including modular units, playground equipment, and fencing. These costs will be paid directly from PSD’s budget (5911452220). Sufficient appropriation is included in the 2025-26 budgets and will be included in future recommended budgets. Annual Lease costs are as follows:
|
Year |
Annual Lease Cost |
Estimated Other Lease Cost |
|
August 1, 2026 - July 31, 2027 |
$143,700 |
$12,118 |
|
August 1, 2027 - July 31, 2028 |
$148,008 |
$12,602 |
|
August 1, 2028 - July 31, 2029 |
$152,448 |
$13,106 |
|
August 1, 2029 - July 31, 2030 |
$157,020 |
$13,630 |
|
August 1, 2030 - July 31, 2031 |
$161,736 |
$14,175 |
|
Total Cost |
$762,912 |
$65,631 |
BACKGROUND INFORMATION
On August 30, 1994 (Item No. 49), the Board approved Lease Agreement No. 94-961 (Original Lease) with Cucamonga Service Club (Original Landlord) for a five-year term with three two-year options to extend the term of the Original Lease for the Premises upon which PSD installed County-owned modular classrooms and playground equipment. The initial term of the Original Lease was for the period of August 1, 1993 through July 31, 1998. During the term of the Original Lease, the Board approved eight amendments to extend the term of the Original Lease through the exercise of options, adjust the rental rate schedule, add additional options to extend the term, and update standard lease agreement language.
On September 26, 2017 (Item No. 29), the Board approved the Lease, as a replacement lease, with the Original Landlord for a 15-year term with two five-year options to extend the term for the property. The initial term of the Lease was for the period of October 1, 2017 through September 30, 2032. Since the Lease was approved, Amendment No. 1 was approved by the Board and Amendment Nos. 2 and 3 were executed by the Director of RESD, pursuant to delegated authority. Collectively, these amendments reduced the term by six years and two months, changing the end date from September 30, 2032 to July 31, 2026, and removed the County’s existing two five-year options to extend. The amendments also updated the termination language and reflected a change in ownership to SoCal.
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Amendment No. |
Approval Date |
Item No. |
|
1 |
March 1, 2022 |
49 |
|
2 |
September 23, 2022 |
*- |
|
3 |
February 17, 2026 |
*- |
*Executed by Director of RESD
PSD requested that RESD negotiate an Amendment to extend the existing Lease term, which is set to expire on July 31, 2026. The recommended Amendment will memorialize the mutual agreement of the parties to extend the Lease term, for the period of August 1, 2026 through July 31, 2031. The Amendment will also adjust the rental rate schedule, update the termination rights to allow the County the right to terminate the Lease with a 90-day notice, and update standard lease agreement language. All other lease terms will 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 - Class 1 Existing Facilities because the proposed Lease is to secure property to operate within the existing structure with negligible or no expansion of existing use.
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Summary of Lease Terms |
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Lessor: |
SoCal Hospitality & Investments, LLC Asrar Khan, Managing Member |
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Location: |
9324 San Bernardino Road, Rancho Cucamonga |
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Size: |
Approximately 54,433 square feet of unimproved land and parking area |
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Term: |
Five years; August 1, 2026 through July 31, 2031 |
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Options: |
None |
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Rent: |
Cost per sq. ft. per month: $0.22* modified gross |
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Monthly: $11,975 |
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Annual: $143,700 |
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*Mid-range for comparable facilities in the Rancho Cucamonga area per the competitive set analysis on file with RESD |
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Annual Increases: |
Approximately 3% |
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Holdover: |
The monthly rental rate during the holdover term shall be increased by 15% of the monthly rent that existed and prevailed at the expiration of the immediately preceding term, but excluding any amortized amounts for improvements, if any |
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Improvement Costs: |
None |
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Custodial: |
Provided by Lessor |
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Maintenance: |
Routine maintenance shall be provided by the County for the Premises and by the Landlord for the shared access lanes serving the Premises, with the County reimbursing 50% of the routine maintenance costs for such shared access lanes, not to exceed $2,500 per lease year |
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Utilities: |
Provided by County |
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Insurance: |
The Certificate of Liability Insurance, as required by the Lease, is on file with RESD |
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Right to Terminate: |
County may terminate the Lease with 90 days’ notice |
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Parking: |
Approximately 22,933 square feet of parking area |
PROCUREMENT
County Policy 12-02 provides that the Board may approve the use of an alternative procedure in lieu of a Formal Request for Proposal (RFP) process 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 interest of the County.
REVIEW BY OTHERS
This item has been reviewed by County Counsel (John Tubbs II, Deputy County Counsel, 387-5455) on June 18, 2026; Preschool Services (Arlene Molina, Director, 383-2028) on May 22, 2026; Purchasing (Ariel Gill, Supervising Buyer, 387-2070) on May 19, 2026; and County Finance and Administration (Allegra Pajot, 388-0218, and Eduardo Mora, 387-4375, Administrative Analysts, and Yael Verduzco, Principal Administrative Analyst 387-5285) on June 18, 2026.
(AH: 840-266-8977)