Resolution - 2019-61RESOLUTION NO.2019-61
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST
COVINA, CALIFORNIA, APPROVING AND DIRECTING THE CITY
MANAGER TO EXECUTE A MEMORANDUM OF EXERCISE OF
SUBLEASE EXTENSION OPTION FOR PARKING FACILITIES AT
THE LAKES AT WEST COVINA WITH CH' 2014/SG COVINA
OWNER LLC
The City Council of the City of West Covina, California, does hereby resolves as
follows:
WHEREAS, the Redevelopment Agency of the City of West Covina, as the Agency,
and City of West Covina, as the City, Lease Agreement dated August 1, 1988 (the "Master
Lease") for the Parking Facilities on Agency owned land. The Master Lease was entered into by
and between the Agency as lessor and the City as lessee.;
WHEREAS, the City and Watt Investment Properties, Inc., as the Developer, entered
into an Agreement for Sublease of Portion of Parking Facilities dated August 1, 1988 (the
"Sublease"). The Sublease was entered by and between the City as lessor and the Developer as
sublessee; and
WHEREAS, the Agency entered into a Restated Disposition and Development
Agreement (the "Restated DDA") dated June 26, 1987, a First Implementation Agreement
thereto dated as of December 22, 1987, and a Second Implementation Agreement dated as of
August 1, 1988 with the Operator's predecessor in interest for the sale of certain land (the
"Developer Parcels #I and 2") to the Operator's predecessor in interest for development thereon
of commercial office buildings; and
WHEREAS, the City constructed on the Agency Parking Structure Parcels certain
off-street parking facilities (the "Parking Facilities") and entered into the Sublease, as the
sublessor and defined in the Sublease as the City, (the "Sublessor") with Watt Investment
Properties, Inc. ("Watt"), a predecessor -in -interest to Operator, as the sublessee and defined in
the Sublease as the Developer, (the "Sublessee") for Twenty -Five Percent (25%) of the Parking
Facilities (the "Subject Premises") in order to implement the Redevelopment Plan adopted by
the Redevelopment Agency of the City of West Covina and the Restated DDA (and the
Implementation Agreements thereto), and in order to provide for the operation and maintenance
of the Subject Premises; and
WHEREAS, Operator has also purchased the Developer Parcels #1 and 2 and
succeeded to the interests and assumed all liabilities of the Sublessee under the Sublease; and
WHEREAS, Watt also entered into an operating agreement on August 1, 1988 (the
"1988 Operating Agreement") with the City to manage the 75% of the Parking Facilities which
are not included within the Sublease (the "City's Premises"). On May 15, 2018, the City of West
Covina and the new owner, CIP 2014/SG Covina Owner LLC, entered into new Operating
Agreement and have continued to operate under the terms and conditions of the 2018 Operating
Agreement to date; and
WHEREAS, on or about February I, 2012, the City began acting as the "Successor
Agency" to the Agency pursuant to various California statutes relating to the dissolution of
Redevelopment Agencies in the State (the "Redevelopment Dissolution Laws"). The Successor
Agency is a separate legal entity from the City pursuant to the Redevelopment Dissolution
Laws.
WHEREAS, on or about December 15, 2015, the Agency Parking Structure Parcels
were transferred to the City pursuant to various California statutes relating to the dissolution of
Redevelopment Agencies in the state, but there has been no merger of the Master Lease and the
Sublease.
WHEREAS, Section 3 D of the Sublease, as amended by the First Amendment to
Agreement for Sublease for Portion of Parking Facilities dated January 1, 1989, grants the
Developer the option to extend the Initial Term, which expired August 1, 2018, with 5
additional terms of Five (5) years each (hereinafter referred to as the "Extended Term") subject
to conditions outlined in the section.
WHEREAS, The City Council finds that the sale of the Eastland Center Parking
Facilities (Parcel D) is exempt from review under the California Environmental Quality Act
pursuant to California Code of Regulations Section 15061 (b) (3) - General rule of no potential
for causing significant impact; as the sale of property does not allow any new uses or activities,
and no development approvals are granted by this purchase and sale of the property.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF WEST
COVINA CALIFORNIA, DOES RESOLVES AS FOLLOWS:
SECTION 1. The City Council of the City of West Covina hereby approves and directs the
City Manager to execute a Memorandum of Exercise of Sublease Extension Option for Parking
Facilities at The Lakes at West Covina in substantially the form of Exhibit A, attached hereto
and by this reference incorporated herein, with CIP 2014/Sg Covina Owner LLC.
(THIS SECTION HAS BEEN INTENTIONALLY LEFT BLANK)
SECTION 2. The City Clerk shall certify to the adoption of this resolution.
PASSED, APPROVED AND ADOPTED on August 20`h, 2019
Lloyd Johnso
Mayor
APPROYED,AS TO FORM ATTEST
Th mas u to Carrie Gallagher
City Attorney Assistant City Clerk
I, CARRIE GALLAGHER, ASSISTANT CITY CLERK, custodian of the original records,
which are public records which I maintain custody and control for the City of West Covina,
California, do HEREBY CERTIFY, the foregoing resolution, being Resolution No. 2019-61 was
adopted at a Regular Meeting of the City Council on August 201h, 2019, by the following roll call
vote:
AYES: Castellanos, Johnson, Lopez-Vaido, Shewmaker, Wu
NOES: None
ABSENT: None
ABSTAIN: None
Carrie Gallagher, CMC
Assistant City Clerk
MEMORANDUM OF EXERCISE OF SUBLEASE EXTENSION OPTION FOR
PARKING FACILITIES AT THE LAKES AT WEST COVINA
THIS MEMORANDUM OF EXERCISE OF SUBLEASE EXTENSION OPTION FOR PARKING
FACILITIES AT THE LAKES AT WEST COVINA (the "Memorandum") is entered into as of the
20th day of August, 2019, between The City of West Covina ("Sublessor") and CIP 2014/SG
Covina Owner LLC, a Delaware limited liability company ("Sublessee"), with respect to the
following facts:
A. Sublessor and Sublessee are parties to that certain Agreement for Sublease of Portion of
Parking Facilities originally by and between City and Watt Investment Properties, Inc. a California
corporation and West Covina Lakes Associates, a California limited partnership (collectively,
together with their successors and assigns, "Watt"), dated as of August 1, 1988, as amended by
First Amendment of Agreement for Sublease of Portion of Parking Facilities between City and
Watt dated January 1, 1989 , and Second Amendment of Agreement for Sublease of Portion of
Parking Facilities between City and Watt dated February 28, 1989 (the "Sublease"). Sublessee
is the ultimate successor in interest to Watt.
B. The initial term of the Sublease was from September 1, 1988 until August 1, 2018
C. Pursuant to Section 3.D of the Sublease, the initial term of the Sublease can be extended
for five (5) additional terms of five (5) years each.
D. The first option to extend the initial term of the Sublease has been exercised, thereby
amending the expiration date of the Sublease term to be August 1, 2023.
NOW, THEREFORE, THE PARTIES DESIRE TO MEMORIALIZE THE AMENDMENT OF THE
SUBLEASE TERM AND AGREE AS FOLLOWS:
The current term of the Sublease will expire on August 1, 2023.
2. Sublessee has four remaining options to extend the term of the Sublease for four (4)
additional terms of five (5) years each, in accordance with the procedure set forth in Section 3.D
of the Sublease.
3. Except as provided herein, the Sublease remains in full force and effect as originally set
forth.
[Signatures on next page]
57037585.v2
IN WITNESS WHEREOF, THE PARTIES HAVE EXECUTED THIS MEMORANDUM AS OF THE
DATE FIRST SET FORTH ABOVE.
SUBLESSOR:
City of West Covina
By: A
Name: Davi Carmany
Title: City Manager
SUBLESSEE:
CIP 2014/SG Covina Owner LLC
By:
me: John Drachman
itle: Authorized Signatory
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