HomeMy WebLinkAbout12-09-2020 Lease Agreement with County of SLO and for 1100 Mill Street_Executed CopyPage 1 of 10
LEASE AGREEMENT
THIS LEASE AGREEMENT (Lease) is entered into between the County of San Luis Obispo, a political
subdivision of the State of California (County) and the City of San Luis Obispo (Lessor) (collectively the Parties).
NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties
hereto agree as follows:
1.Premises: Lessor hereby leases to County, and County hereby hires and takes from Lessor, for the
term, at the rental and upon the conditions hereinafter set forth, those certain premises located at 1100 Mill Street
(eight spaces marked as #10-#17 in the Northeast corner of Santa Rosa and Mill parking lot), San Luis Obispo,
California, depicted as a portion of APN: 002-316-007 as shown on Exhibit "A" attached hereto and incorporated
herein.
2.Quiet Enjoyment: Lessor agrees to and shall on the commencement date of the term of this Lease
hereinafter set forth, place County in quiet possession of the leased Premises and shall secure to County the quiet
possession hereof against all persons claiming the same during the entire term and any renewals or extensions
thereof.
3.Term: The term of this Lease shall commence on the date the Lessor signs this Lease and continuing
through August 31, 2024, at which time the Term will continue on a month-to-month basis. Either party may terminate
this Lease at any time upon ninety (90) days advance written notice to the other party.
4.Rental: Beginning on the date the Lessor sign’s this Lease and continuing for the term of the lease,
County shall pay Lessor as rent for the Premises the sum of Two Hundred, Fifty Two and 00/100 Dollars ($250.00) per
month (hereinafter referred to as Base Monthly Rent), payable in advance on the first day of each month. All rental
payments, unless changed in writing by Lessor, shall be sent to:
City of San Luis Obispo – Parking Services
1260 Chorro Street, Suite B
San Luis Obispo, CA 93401
A.Annual Rent Increase: Beginning on the first day of the month following the anniversary of the
Commencement of the Term, and on that same date as occurring during the term, and any extensions
of the term, each year thereafter (hereinafter referred to as the Adjustment Date), the Base Monthly
Rent shall be increased by three percent (3%) over the Base Monthly Rent due immediately prior to
the Adjustment Date. Lessor shall provide written notice to County of the adjusted Base Monthly
Rent amount on an annual basis. If for any reason the Lessor fails to provide such notice to the
County prior to an Adjustment Date, County may continue to pay the Base Monthly Rent for the prior
period until notice of the adjustment is provided, at which time County shall promptly pay to Lessor
any accrued adjustment deficiencies and shall thereafter pay Base Monthly Rent as adjusted.
5.Late Charge; Interest: County acknowledges that either late payment of Rent or issuance of a non-
sufficient funds check may cause Lessor to incur costs and expenses. These costs may include, but are not limited to,
processing, enforcement, and accounting expenses. If any installment of Rent due from the County is not received
by Lessor within seven (7) business days after due date, or if a check is returned for non-sufficient funds, County shall
pay to Lessor 10% interest per annum on the delinquent amount and $25.00 as a non-sufficient funds fee, if any, any
of which shall be deemed additional Rent. Lessor’s acceptance of any late charge or non-sufficient funds fee shall
not constitute a waiver as to any default of the County. Lessor’s right to collect a late charge or non-sufficient funds
fee shall not be deemed an extension of the date Rent is due under paragraph 4, or prevent Lessor from exercising
any other rights and remedies under this agreement, and as provided by law.
6.Use of Leased Premises: The Premises shall be used only as a parking lot for the regular use of the
County, and the limited use by the Lessor on weekends and after 6:00 pm and until 6 am on weekdays. The County
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warrants that it has received written authorization from the Ahearn Revocable Trust (Exhibit B) for the Lessor’s access
across a portion of the Ahearn parcels (APN: 002-316-008 and 002-316-017, as depicted on Exhibit A) (“Ahearn
Parcel”) to the Premises. Lessor agrees that the scope of the use of the Ahearn Parcel under this Agreement is limited
to use on weekends and after 6 pm on weekdays and until 6 am on weekdays (After Hours), during which time the
Lessor can access its 8 spaces from the Ahearn Parcel and use any available parking space for its official City vehicle
use only.
7.Zoning and Land Use: County accepts the Premises subject to all local, state, and federal laws,
regulations, and ordinances (hereinafter referred to as Laws). Lessor makes no representation or warranty that
Premises are now or in the future will be suitable for County’s use. County has made its own investigation regarding
all applicable Laws.
8.Insurance:
A.Liability Insurance.
1)Lessor: Lessor agrees to maintain in force throughout the term hereof, at Lessor’s sole cost
and expense, commercial general liability insurance. This insurance shall include, but shall not be limited to,
commercial general liability insurance providing protection against third party claims arising from bodily and personal
injury, including death resulting therefrom, and damage to property resulting from any act or occurrence arising out
of Lessor’s operations during the time of this Lease and includes Lessor’s access across the Ahearn property. The
commercial general liability policies shall name the “County of San Luis Obispo, its officers, and employees” as
additional insureds.
2) County: County is presently self-insured. County agrees to maintain in force throughout
the term hereof, at County’s sole cost and expense, commercial general liability insurance with a broad form general
liability endorsement insuring against any liability to the public for any claim for damages due to death, bodily injury
or property damage related to County’s occupancy of the Premises, with single limit coverage of not less than
$1,000,000 per occurrence. Lessor shall be named as an additional insured in such policy. County shall provide Lessor
with at least thirty (30) days’ notice of cancellation of insurance.
9.Indemnification: County shall indemnify, defend, and hold Lessor harmless from all claims, disputes,
litigation, judgments, and attorney fees arising out of County’s use of the Premises. Lessor shall indemnify, defend,
and hold County harmless from all claims, disputes, litigation, judgments, and attorney fees arising out of Lessor’s
use of the Premises and Lessor’s use of the Ahearn’s property to access the Premises.
To the fullest extent permitted by law, Lessor and County shall indemnify, defend, and hold harmless the
other party and its officers, agents, employees, and volunteers from and against all claims, demands, damages,
liabilities, loss, costs, and expense (including attorney’s fees and costs of litigation) of every nature arising out the
breaching party’s failure to comply with any of its obligations contained in the agreement, except such loss or damage
which was caused by sole negligence or willful misconduct of the breaching party.
Lessor and County shall at all times and in all respects comply with all federal, state, and local laws,
ordinances, and regulations, including Hazardous Materials Laws. Lessor and County shall further indemnify, defend,
protect, and hold each other free and harmless from and against any and all claims, liabilities, penalties, forfeitures,
losses or expenses (including attorneys' fees) or death of or injury to any person or damage to any property
whatsoever, arising from or caused in whole or in part, directly or indirectly, by Lessor’s or County’s failure to comply
with any law.
10.Surrender: County shall surrender the Premises unto Lessor on the last day of the term or sooner
termination of this Lease in the same condition as when received, reasonable use and normal wear and tear excepted.
At the termination of the Lease, County shall remove County’s signs, posts, and wheel blocks. County shall patch the
asphalt at the location where signposts and wheel blocks are removed. County shall not be responsible to repave or
reseal the Premises unless County’s use results in degradation of the asphalt. Attached as Exhibit “C” is
photograph documentation of the condition of the Premises at the time this Lease was executed by the Parties.
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11.Improvements, Remodeling, Alterations and Additions: County at its cost shall have the right
and responsibility to stripe the parking area on the Premises, install wheel blocks, and erect signs which may indicate
the parking area is for County’s regular use and the Lessor’s limited use.
County shall not make, or suffer to be made, any other alterations (whether major or minor) of the
Premises, or any part thereof, without the written consent of Lessor first had and obtained.
12.Repairs: Lessor agrees to repair, at Lessor’s sole cost and expense, the parking lot on which the
Premises are a part, and/or the driveway entrance to the Premises. If Lessor fails or neglects to conduct necessary
repairs to a reasonable standard, within thirty (30) days plus any additional period reasonably required by the
circumstances after County’s notice to Lessor of the need for repairs and/or maintenance, County may repair and/or
perform maintenance of the same and deduct the expenses of such repairs from the rent to the lawful extent without
waiver.
13.Janitorial and Maintenance: County at its cost shall clean the Premises as needed and as associated
with the County’s use of the Premises. Such cleaning will be performed by County’s groundskeepers who shall also
be available to respond if an unusual event needs cleanup as associated with the County’s use of the Premises.
14.Assignment and Default: County shall not assign this Lease, nor sublet the whole or any part of the
Premises, without the prior written consent of Lessor.
15.Signs: County, upon Lessor’s prior written approval, shall at its sole cost, erect, construct and
maintain signs on the Premises, including, but not limited to, signs declaring the Premises parking for the County’s
regular use and the Lessor’s limited use. Any signs County has the right to place, erect, construct, and maintain shall
comply with all laws, and County shall obtain any approval required by such laws. Lessor makes no representation
with respect to County’s ability to obtain such approval.
16.Destruction of Premises: If during the term of this Lease, the Premises are injured or destroyed by
fire or other cause, so as to render the Premises, in County’s judgment, unfit for use of the Premises for intended
purposes, then this Lease shall terminate at the option of County.
17.Environmental Matters / Covenants Regarding Hazardous Materials: Lessor and County shall at
all times and in all respects comply with all federal, state and local laws, ordinances and regulations ("Hazardous
Materials Laws") relating to industrial hygiene, environmental protection or the use, analysis, generation, manufacture,
storage, disposal or transportation of any oil, flammable explosives, asbestos, urea formaldehyde, radioactive
materials or waste, or other hazardous, toxic, contaminated or polluting materials, substances or wastes, including,
without limitation, any "hazardous substances," "hazardous wastes," "hazardous materials" or "toxic substances"
under such laws, ordinance or regulations (collectively, "Hazardous Materials").
Lessor and County shall further indemnify, defend, protect, and hold each other free and harmless from and
against any and all claims, liabilities, penalties, forfeitures, losses or expenses (including attorneys' fees) or death of
or injury to any person or damage to any property whatsoever, arising from or caused in whole or in part, directly or
indirectly, by:
(A) the presence in, on, under or about the Premises or discharge in or from the Premises of any Hazardous
Materials or Lessor's or County’s use, analysis, storage, transportation, disposal, release, threatened release, discharge
or generation of Hazardous Materials to, in, on, under, about or from the Premises, or
(B) Lessor's or County's failure to comply with any Hazardous Materials Law. Lessor's and County's
obligations hereunder shall include, without limitation, and whether foreseeable or unforeseeable, all costs of any
required or necessary repair, cleanup or detoxification or decontamination of the Premises, and the preparation and
implementation of any closure, remedial action or other required plans in connection therewith, and shall survive the
expiration or earlier termination of the term of this Lease. For purposes of the release and indemnity provisions
hereof, any acts or omissions of Lessor or County, or by employees, agents, assignees, contractors or subcontractors
of Lessor or County or others acting for or on behalf of Lessor (whether or not they are negligent, intentional, willful
or unlawful) shall be strictly attributable to Lessor or County.
In no event shall County be liable to Lessor, any regulatory agency or governing body for any
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Hazardous Materials existing, stored, released, or disposed of on, in, or under the Premises prior to the
commencement of the Lease.
18.Notices: Any notices, demands, or communication, under or in connection with this Lease, may be
served by regular mail, personal delivery, or electronic transmission (“e-mail”). Such e-mail notice, and all attachments
thereto, shall for all purposes be deemed received and effective upon receipt at the e-mail address provided, and that
such notice is effective irrespective of whether the addressee shall actually open or read the e-mail notice and/or
attachments. Any e-mail notice to the County shall be addressed as follows:
Central_RPS@co.slo.ca.us
or if by regular mail, such mail must be deposited in the United States Post Office, postage prepaid, and if addressed
to the County at:
County of San Luis Obispo
Central Services Agency
1087 Santa Rosa Street
San Luis Obispo, CA 93408
Attention: Real Property Manager
and may likewise be served on Lessor via e-mail at:
parkinginfo@slocity.org
or if by regular mail, such mail must be deposited in the United States Post Office, postage prepaid, and if addressed
to the Lessor at:
City of San Luis Obispo - Parking Services
1260 Chorro Street, Suite B
San Luis Obispo, CA 93401
Either County or Lessor may change such address by notifying the other party in writing as to such new
address as Lessor or County may desire used and which address shall continue as the address until further written
notice.
19.Successors: The agreements herein made shall apply to, bind, and inure to the benefit of the
successors and assigns of Lessor, and the successors and permitted assigns of County.
20.Provisions Deemed Covenants and Conditions: The parties hereto agree that all the provisions
hereof are to be construed as covenants and conditions as though the words importing such covenants and
conditions are used in each instance, and that all of the provisions hereof shall bind and inure to the benefit of the
parties hereto and their respective heirs, legal representative, successors and assigns.
21.Binding Effect Law: Subject to any provisions hereof restricting assignment or subletting by County,
this Lease shall bind the parties, their personal representatives, successors, and assigns. This Lease shall be governed
by the laws of the State where the Premises are located and any litigation concerning this Lease between the parties
hereto shall be initiated in the County of San Luis Obispo.
22.Prior Agreements: This Lease contains all agreements of the parties with respect to any matter
mentioned herein. No prior or contemporaneous agreement or understanding pertaining to any such matter shall
be effective. This Lease may be modified in writing only signed by the parties in interest at the time of the
modification. Except as otherwise stated in this Lease, County hereby acknowledges that neither the broker (if
applicable) acting as agent for Lessor nor any cooperating agent on this transaction nor the Lessor or any employee
or agents of any said persons has made any oral or written warranties or representations to County relative to the
condition or use by County of the Premises.
23.Subordination Agreement: The County’s rights under this Lease may be subordinate to any
mortgage or deed of trust or any other hypothecation or security entered after or placed upon the Premises and to
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any and all advances made on the security thereof and to all renewals, modifications, consolidations, replacements
and extensions thereof. County’s right to quiet possession of the Premises shall not be disturbed if County is not in
default and so long as County shall pay the rent and observe and perform all of the provisions of this Lease, unless
this Lease is otherwise terminated pursuant to its terms. If any mortgage or trustee shall elect to have this Lease prior
to the lien on its mortgage or deed of trust and shall give written notice thereof to County, this Lease shall be deemed
prior to such mortgage or deed of trust, whether this Lease is dated prior or subsequent to the date of said mortgage
or deed of trust on the recordation date thereof. County agrees to and shall attorn to any purchaser in good faith
and for value or any successor in interest of the Lessor herein.
24.Waivers: No waiver by Lessor of any provision hereof shall be deemed a waiver of any other
provision hereof or of any subsequent breach by County of the same or any other provision. Lessor’s consent to or
approval of any act shall not be deemed to render unnecessary the obtaining of Lessor’s consent to or approval of
any subsequent act by County. The acceptance of rent hereunder by Lessor shall not be a waiver of any preceding
breach by County of any provisions hereof, other than the failure of County to pay the particular rent so accepted,
regardless of Lessor’s knowledge of such preceding breach at the time of acceptance of such rent.
25.Severability: The invalidity of any provision of this Lease shall not affect the validity, enforceability
of any other provision of this Lease.
26.Entire Agreement and Modifications: This Lease embodies the whole Lease Agreement between
the parties hereto as it pertains to the subject real property and there are no promised terms, conditions, or
obligations referring to the subject matter hereof, other than as contained herein. Any alterations, changes or
modifications to this Lease must be in writing and executed by both Lessor and County.
/ / / / / / / / / / NOTHING FURTHER PAST THIS POINT / / / / / / / / / /
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IN WITNESS WHEREOF, the parties hereto have executed this Lease RQBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
COUNTY OF SAN LUIS OBISPO
By: _____________________________
Christopher Lopez
Central Services Director
Date: _____________________________
APPROVED AS TO FORM AND LEGAL
EFFECT:
RITA L. NEAL,
County Counsel
By: _____________________________
Deputy County Counsel
Date: _____________________________
LESSOR
By: _____________________________
___________________________________
Printed name and title
Date: _____________________________
APPROVED AS TO FORM AND LEGAL
EFFECT:
J. CHRISTINE DIETRICK,
City Attorney
By: ___________________________
City Attorney
Date: _____________________________
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12/9/2020 | 10:27 AM PST
Heidi Harmon
12/9/2020 | 1:00 PM PST
12/9/2020 | 1:00 PM PST
Mayor
10/26/20
Leased Parcels
City of
San Luis
Obispo
Leased
Parcel Vehicle AccessSANTA
ROSA
MILL
0 50 100 150 20025
Feet ••
1100 Mill Street
San Luis Obispo
Exhibit A
Parcels
Location
Leased Parcels
City of San Luis Obispo - Leased Parcel
3DJHRI
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Ahearn Family Trust
1319 C Garden Street
San Luis Obispo, CA 93401
(805-541-6428)
Phil D’Acri
Real Property Manager
County of San Luis Obispo
Re: Landlord Permission Request
Dear Phil
Thank you for your recent correspondence regarding the County’s ongoing
negotiations with the City regarding the use of the corner parcel at Mill and Santa Rosa.
Based upon the County’s lease for the adjoining/surrounding property, as
Landlords we do not have the “right” to directly grant the City access across your
leasehold according to our legal counsel. Notwithstanding that concern, we do have the
right to consent to the County, as Lessee, providing the City with access across the
County’s leasehold parking area. Please consider this letter as our approval of the County
allowing the City access across the parking area, conditioned only upon the County
providing us with a copy of the agreement between the City and County providing for
that access.
Hopefully this should eliminate any concerns you may have regarding these
circumstances.
Sincerely,
Sandy Ahearn
(;+,%,7%
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(;+,%,7&
3DJH RI
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(;+,%,7&
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