HomeMy WebLinkAboutC-3502(B) - Letter Agreement for Evaluating Lease Alternatives-)00
CITY OF NEWPORT BEACH
CITY COUNCIL STAFF REPORT
Agenda Item No. 12
June 14, 2005
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
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FROM: Office of the City Manager
Homer L. Bludau, City Manager, 949-644-3000 i Jud q
hbludau@city.newport-beach.ca.us
SUBJECT: RETAIN THE FIRM OF CB RICHARD ELLIS, INC. -OF 4MFYOI
BEACH TO PROVIDE LEASE LOCATION ALTERNATIVES FOR THE
RELOCATION OF CITY HALL DURING THE POTENTIAL
CONSTRUCTION OF A NEW CITY HALL
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Does the City Council approve the City Manager's recommendation to retain the
exclusive services of CB Richard Ellis, at no cost to the City, to locate and evaluate
lease alternatives for the potential relocation of City Hall, if required by a construction
project on the existing site?
RECOMMENDATION:
Approve the letter agreement to retain the relocation services of CB Richard Ellis, Inc.
and authorize the City Manager to sign the agreement.
DISCUSSION:
Background:
At its May 10th meeting, the City Council made the decision to focus on the City Hall
complex option of constructing a new city hall, building a 3 -story parking structure and
replacing the existing fire station. That decision means Griffin Structures will prepare
schematic drawings and determine a final cost estimate for the 3 -building project; it will
bring that cost estimate and renderings to the City Council this Fall for the decision of
whether to proceed with the project. Components of that decision will include the
financing methodology recommended by staff and a relocation plan for the operation of
the city hall functions during the demolition and construction process.
Retain the Firm of CB RicharLlis, Inc. of Newport Beach
June 14, 2005
Page 2
The City Manager will be responsible for developing the financing and relocation
recommendations that will be presented to the City Council. One relocation option the
City Manager wants to evaluate is the leasing of property elsewhere in the City to
conduct the city hall functions while the current site is undergoing construction. The
City Manger believes the best way to weigh the merits of leasing property is to hire a
firm that specializes in the leasing of commercial property and put them to work finding
potential sites that can be evaluated for usefulness, timeliness and affordability. The
City Manager has met with Dean Chandler (Sr. VP of Brokerage Services) and Jeff
Morgan (First VP of Brokerage Services) of CB Richard Ellis, Inc., of Newport Beach to
determine this firm's interest in providing these services. Both Mr. Chandler and Mr.
Morgan have agreed to provide these services at no cost to the City, as the property
owner would pay all fees earned by the CB Richard Ellis company if a lease was
entered into by the City.
Since the City is not obligated to pay any fees, this agreement for services is prepared
as a simple letter agreement.
The relocation of the fire station would not be a part of the services being provided
under this agreement.
Should the City Manager believe a suitable temporary location has been found under
this agreement, the City Council would need to approve that lease agreement.
Submitted by:
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Homer L. Bludaid
City Manager
Dean Chandler
Jeff Morgan
CB Richard Ellis, Inc.
3501 Jamboree Road, Suite 100
Newport Beach, CA 92660
Gentlemen:
CITY OF NEWPORT BEACH
June 14, 2005
This is to acknowledge that the City of Newport Beach has retained your firm CB
Richard Ellis, Inc. as exclusive agent to represent the city's interest in evaluating lease
alternatives in the Newport Beach area, for available property to accommodate
temporary office needs for city hall operations while the current facilities undergo
reconstruction.
We have requested that you search for and evaluate existing buildings in the City of
Newport Beach where appropriate space may be available. In addition to your normal
services, you will provide us with the following:
❖ Market knowledge research
•:• Availabilities
•:• Physical economic analysis
Negotiations
Financial analysis
You are authorized, on our behalf, to meet with owners, developers, brokers and
interested parties to explore real estate situations sufficient to accommodate our needs.
We request that all such meetings be held in a confidential manner.
It is to be understood and agreed, that CB Richard Ellis' negotiations and representation
of our interest are subject to in all cases, to the approval of proposals, leases and
related documents by our appropriate city staff and city council. It is also understood
and agreed that the City will incur no fees for the services provided. Any commissions
and fees, to which CB Richard Ellis may be entitled, shall be the sole responsibility of
the owners and/or developers. This agreement shall be in effect until June 30, 2006,
unless terminated by either party upon thirty (30) day written notice.
Sincerely,
Homer L. Bludau
City Manager
City Hall • 3300 Newport Boulevard • Post Office Box 1768
Newport Beach California 92658-8915 • www.city.newport-beach.ca.us