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HomeMy WebLinkAboutCOM 1120.000 2006-2008 +tlop Harry KimWilliam Takaba Mayor Director Nancy E. Crawford i,:• ••M~O Deputy Director TI pj•M~. County of Hawaii v Finance Department m 25 Aupuni Street, Room 118 • Hilo, Hawaii 96720 i (808) 961-8234 Fax(808)961-8248 Or C,) March 25, 2008 = Pete Hoffmann, Chairman and ZD Members of the Hawai'i County Council Hawai'i County Council o 25 Aupuni Street G') Hilo Hawai'i 96720 Re: Resolution to Negotiate Lease Enclosed is a resolution authorizing the Director of Finance to negotiate a new three year lease with Hawai'i Island Adult Care, Inc., formerly known as Hilo Adult Day Care, Inc. for a portion of the premises located at 34 Rainbow Drive, Hilo, Hawai'i, known as the "OLD HILO HOSPITAL COMPLEX" located on property identified as Tax Map Key: (3) 2-3-026: 008. The County of Hawai'i currently has jurisdiction over the property and building located at 34 Rainbow Drive from the State of Hawai'i through Governor's Executive Order No. 3773. Hawai'i Island Adult Care, Inc., formerly known as Hilo Adult Day Care, Inc., has occupied the subject portion of the building since at least 1982. The prior lease and various renewals between the County of Hawai'i and Hawai'i Island Adult Care, Inc. have expired and necessitates the negotiation of a new lease. Although Hawai'i Island Adult Care, Inc. is currently working on future plans for a new facility, they do anticipate having a new facility to move into for at least three years. In the interim, Hawai'i Adult Care, Inc. acknowledges the age and condition of the building and grounds but requests that they be allowed to continue to operate in their location as they provide a very valuable service to the community. If there are any questions, please do not hesitate to call the Department of Finance. William a Director of Finance APPROVED: aw&GHarry Kim Comm. No Mayor Ref. To.. G Ref, Data 1j 77 _ 2nm Enc. Hawaii County is an Equal Opportunity Provider and Employer 583'0$ f Form B-52 7/18/91 DEPARTMENT OF FINANCE REQUEST FOR COUNCIL ACTION DEPARTMENT: FINANCE DATE: March 24, 2008 STAFF CONTACT: Harry Yada PHONE: 961-8009 A. REQUEST: Resolution that authorizes the Director of Finance to negotiate a new three year lease with Hawai'i Island Adult Care, Inc., formerly known as Hilo Adult Day Care, Inc. for a portion of the premises located at 34 Rainbow Drive, Hilo, Hawai'i, known as the "OLD HILO HOSPITAL COMPLEX" located on property identified as Tax Map Key: (3) 2-3-026: 008. B. BACKGROUND AND JUSTIFICATION (USE ADDITIONAL SHEETS AS NEEDED): The County of Hawai'i currently has jurisdiction over the property and building located at 34 Rainbow Drive from the State of Hawai'i through Governor's Executive Order No. 3773. Hawai'i Island Adult Care, Inc., formerly known as Hilo Adult Day Care, Inc., has occupied the subject portion of the building since at least 1982. The prior lease and various renewals between the County of Hawai'i and Hawai'i Island Adult Care, Inc. have expired and necessitates the negotiation of a new lease. Although Hawai'i Island Adult Care, Inc. is currently working on future plans for a new facility, they do anticipate having a new facility to move into for at least three years. In the interim, Hawai'i Adult Care, Inc. acknowledges the age and condition of the building and grounds but requests that they be allowed to continue to operate in their location as they provide a very valuable service to the community. A copy of the lease agreement is attached. ;i SIGNED: wzoc,__-~ DATE: MAR 2 v 200$ Department Head HAWAII ISLAND ADULT CARE LEASE AGREEMENT THIS INDENTURE OF LEASE, made this day of by and between and the COUNTY OF HAWAII, a municipal corporation of the State of Hawaii, whose principal place of business and mailing address is 25 Aupuni Street, Hilo, Hawaii 96720 (hereinafter referred to as the "County"), and HAWAII ISLAND ADULT CARE, INC., a Hawaii corporation, whose principal place of business and mailing address is 34 Rainbow Drive, Hilo, Hawaii 96720 (hereinafter referred to as the "Center"). WI'I'NESSETH: WHEREAS, since at least 1982, the Center has occupied a portion of the premises known as the Old Hilo Hospital complex, located at 34 Rainbow Drive, Hilo, Hawaii 96720, identified as being a portion of Tax Map Key: (3)2-3-026:008 (hereinafter "Complex"); and WHEREAS, the County's possessory interest in the Complex is via an Executive Order from the State of Hawaii. Therefore, all successor interest holder are also subject to any terms and conditions required by the State of Hawaii, including divestment of all interests; and WHEREAS, the Complex is an aged facility and in various states of disrepair; and WHEREAS, the Center, being intimately familiar with the condition of the Complex, desires to continue to utilize a portion of the building and grounds of the Complex for office use and to operate an adult day care center. NOW, THEREFORE, THE PARTIES COVENANT AND AGREE AS FOLLOWS: 1. Premises. (a) County hereby leases to the Center, upon the terms and conditions herein set forth, that portion of the Complex located at 34 Rainbow Drive, Hilo, Hawaii, identified as being a portion of Tax Map Key: (3)2-3-026:008 and described in Exhibit "A" attached hereto (hereinafter referred to as the "premises'). (b) The parties acknowledge that the square footage of the premises as set forth in Exhibit "A," is 2,520 square feet of office space and 6.810 square feet of day care space, which constitute a portion of the Complex. (c) The parties understand and agree that the County may only transfer to the Center such rights in the facility and grounds that it receives from the State of Hawaii and under such terms and conditions imposed by the State of Hawaii. Notwithstanding any provisions to the contrary, this lease is subject to any cancellation of use of the facility by the Department of Land and Natural Resources, State of Hawaii. 23026008 -2- 2. Term. The term of this lease shall commence on February 17, 2008, and shall continue for a term of 3 years. 3. Occupancy. The Center shall be given occupancy of the premises by February 17, 2008. 4. Rent. The lease rent shall be paid as follows: Office Space: $1.00/year Day Care Space: $1.00/year 5. Parking _Spaces. Parking space shall be open and joint to all users of the Complex. 6. Use. The premises may be used and occupied for general office use and day care for the Hawaii Island Adult Care, Inc. 7. Use of Premises and Compliance With Law. The County and the Center agree to the following terms and conditions regulating the use of the premises: (a) The Center shall not perform any acts or carry on any practices which may be injurious to the building, or is a nuisance or menace to other tenants in the building, and agrees to maintain them with particular attention being paid to their orderliness, safety, cleanliness and quality. (b) The Center shall not permit the premises to be used for any improper, offensive, or unlawful purpose or for any purpose which will increase the existing rate of insurance on the property. The Center will keep the premises in a strictly clean, safe, neat and sanitary condition, and will observe, perform and comply with all laws, statutes, ordinances, rules and regulations of the health and other government authorities applicable to the premises and of all insurance policies at any time duly issued or in force which are applicable to the conduct of the Center's business on or about the premises or any part thereof, and will defend the County against all actions, suits, damages and claims by whomsoever brought or made by reason of the nonperformance or nonobservance of such laws, statutes, ordinances, rules and regulations or of this covenant. (c) The Center shall not commit or suffer to be committed any waste in or upon the premises or the property or maintain any public or private nuisance or any other action which may interfere with or disturb the quiet enjoyment of any other tenant of the property. (d) The Center shall not maintain, place or store any items in any common area of the premises, including parking areas, without the specific written consent of the County. (e) The Center shall not install or place any exterior signs or other displays on or upon the premises and/or the property without the prior written consent of the County. The 23026008 -3- County shall have the right to establish such specifications and restrictions for exterior Center displays and signs as the County, in the County's sole discretion, shall determine. 8. Rule and Regulations. The County shall have the right to promulgate rules and regulations to police, regulate traffic in, control parking and common area use (including controlled access or paid parking), restrict exterior Center advertising, signage and displays within the Center and otherwise regulate and control the property, and amend the same from time to time, with respect to the use and operation of the property, which shall be binding upon the Center on notice to the Center. In enforcing these rules and regulations, the County shall have all remedies provided in this lease for a breach of a term of this lease, and all other legal and equitable remedies. 9. Improvements Alterations and Fixtures. (a) The Center may, at anytime during said term, with prior consent of County, remove any fixture, addition, or personal property installed by the Center in or about the facility if such removal does not damage any structural portion of the facility. The Center will, at its own expense, promptly repair to the County's satisfaction all damages, cosmetic or structural, caused by such removal. (b) The Center shall obtain all permits, licenses and approvals required for any alterations or improvements and promptly pay all contractors and materialmen so as to minimize the possibility of a lien attaching to the premises or to the property, and should any such lien be made or filed, the Center shall discharge the same after written request by the County. 10. Repairs and Maintenance. (a) Repairs by County. The Center shall at all times keep the premises (including entrances, all interior glass and window moldings) and all partitions, doors, fixtures, equipment and appurtenances therein (including lighting and plumbing fixtures and any air conditioning system, but excluding structural portions of the premises, i.e., foundations, load bearing and exterior walls, and skylights) in good order, condition and repair (including reasonable periodic painting of the interior). (b) County's Right to Cure Center's Default. If the Center refuses or neglects to repair as required under this lease to the reasonable satisfaction of the County as soon as reasonably possible after written demand, the County may make such repairs without liability to the Center for any loss or damage that may occur to the Center's property or to the Centers business, and upon completion thereof, the Center shall pay the County's costs for making such repairs upon a presentation of the bills therefore, as additional rent. 23026008 -4- 11. Liens and Insolvency. The Center shall keep the premises and the property free from any liens or encumbrances arising out of any work performed by the Center, materials furnished by the Center, or obligation incurred by the Center. 12. Assignment and Subletting. (a) Restriction on Assignment and Subletting. The Center shall not assign this lease, or any interest therein, nor sublet the premises or any part thereof, or any right or privilege appurtenant thereto, nor suffer any other person (the agents and employees of the Center excepted) to occupy or use the premises, or any portion thereof, without the prior written consent of the County, which consent may be withheld for any or no reason at the County's sole discretion. (b) Continuing Liability of the Center. No assignment or subletting of the Center's interest permitted under this paragraph or consented to by the County shall in any way release the Center of any liability and responsibility assumed under the terms of this lease. 13. Surrender and Holding Over. (a) Surrender Upon Termination. At the expiration of the term of this lease, the Center shall surrender the premises in the same condition of cleanliness, repair and sightliness as the premises were in upon the Center's commencement of business under this lease, reasonable wear and tear excepted. The Center shall surrender all keys to the premises to the County at the place then fixed for the payment of rent. On such day, unless the County shall in its sole discretion require the removal thereof, all alterations, additions, improvements, all hard surface bonded or adhesively affixed flooring, and all fixtures on the premises shall become the property of the County and shall remain upon and be surrendered with the premises as part thereof, without disturbance, molestation or injury, and without credit to the Center, its sublessees, concessionaires or licensees. On or before the last day of the term or the sooner termination hereof, the Center, if not then in default, shall remove all trade fixtures, operating equipment and other personal property of the Center and, if required by the County, remove all alterations, additions, improvements, flooring and other fixtures, from the premises and repair any damage occasioned by any such removal. If the County is required to repair any damage caused to the premises by such removal, the Center shall repay the County for the cost of the same. Property not so removed shall be deemed abandoned by the Center. If the premises are not surrendered at such time, the Center shall indemnify the County against loss or liability resulting from delay by the Center in so surrendering the premises, including without limitation, any claims made by any succeeding tenant based on such delay and/or the County's lost rental income. The Center's obligation to observe or perform this covenant shall survive the expiration or other termination of the term of this lease. (b) Holding Over. Any holding over after the expiration of the term of this lease, with the consent of the County, shall be construed to be a tenancy from month-to-month at a 23026008 -5- monthly rent that was in effect at the end of the last lease term and on the same terms and conditions specified in this lease, so far as applicable. 14. Default. (a) Right to Reenter. In the event of (i) any failure to perform any terms, conditions, or covenants of this lease to be observed or performed by the Center (except for a default in the payment of rent) for more than ten days, the County shall have in addition to any other recourse, the right to immediately terminate this lease with sixty days' written notice of such default or breach, or (ii) the occurrence of any event described in paragraph 11 above, or (iii) if the Center shall abandon the premises, or suffer this lease to be taken under any writ of execution, any such happening shall be considered a default by the Center, and the County, besides any other rights or remedies it may have, shall have the immediate right, with or without termination, of reentry and may remove all persons and property from the premises and such property may be removed and stored in a public warehouse or elsewhere at the cost of and for the account of the Center, all without service of notice or resort to legal process and without the County being deemed guilty of trespass, or becoming liable for any loss or damage which may be occasioned thereby. (b) Termination. In addition to any default by the Center, as that term is defined in paragraph 14(a) above, the County and the Center may terminate this lease by giving sixty days' written notice of termination with cause. No reentry or taking possession of the premises by the County shall be deemed its election to terminate this lease unless a written notice of termination is given to the Center or unless the termination is decreed by a court of competent jurisdiction. The County may at anytime after reletting the premises without terminating this lease, elect to terminate this lease for the Center's previous default. (c) Damages to County. If the County terminates this lease because of a default by the Center, in addition to any other remedies the County may have, it may recover from the Center all damages it may incur by reason of such default, including the cost of recovering the premises, attorney's fees, and the worth at the time of such termination of the excess, if any, of the amount of rent and additional rent reserved in this lease for the remainder of the stated term over the then reasonable market rental value of the premises for the remainder of the stated term, all of which amounts shall be immediately due and payable from the Center to the County. (d) Separate Suits. The County shall have the privilege of splitting its cause of action for rent so as to permit institution of a separate suit or proceeding for the base and additional rent due the County under this lease, and a separate suit or proceeding for any other payment required under this lease and neither the institution of any such suit or proceeding nor the entering of judgment therein, shall bar the County from bringing a subsequent suit or proceeding for the base rent, the additional rent, or for any other payments required hereunder. 23026008 -6- (e) Nonwaiver. The waiver by the County of any breach of any term, covenant or condition of this lease shall not be deemed a waiver of such term, covenant or condition or of any subsequent breach of any term, covenant or condition. The subsequent acceptance of rent by the County shall not be deemed a waiver of any preceding breach by the Center of any term, covenant or condition of this lease, other than the failure of the Center to pay the particular rent so accepted, regardless of the County's knowledge of such preceding breach at the time of such acceptance. (f) Waiver of Jury Trial and Venue. The parties each hereby waive trial by jury in any action, proceeding or counterclaim brought by either against the other on any matter whatsoever arising out of or in any way connected with this lease or the Center's use or occupancy of the premises, including any claim of injury or damage, and any emergency and other statutory remedy with respect thereto. The parties also agree that the venue of any such action, proceeding or counterclaim shall be in the South Hilo Division of the District or Circuit Court of the Third Circuit, as appropriate. 15. Damaee to or Destruction of Buildin¢. The Center shall, in the event of any damage or destruction affecting the premises, unless this lease shall be terminated as provided in paragraph 14(b), promptly replace or fully repair all fiuniture, improvements, trade fixtures, equipment and other fixtures originally installed by the Center. The County shall have no interest in the proceeds of any insurance carried by the Center on the Center's interest in this lease, and the Center shall have no interest in the proceeds of any insurance carved by the County. 16. Condemnation. (a) Automatic Termination of Lease. Except as may otherwise be required by any mortgage on the property, if the whole of the premises shall be taken by any public authority under the power of eminent domain, then the term of this lease shall cease as of the day possession is taken by such public authority, and all rent shall be paid up to that date. If only a part of the premises shall be taken under eminent domain, this lease shall terminate as to the portion taken, and, unless this lease shall be terminated as hereinafter provided, it shall continue in full force and effect as to the remainder of the premises, and the base rent shall be reduced in the proportion the floor area taken bears to the total floor area leased, and the Center at its own cost and expense, shall make all necessary repairs and alterations to the premises required by such taking. (b) Option to Cancel. If the remainder of the premises cannot be made tenantable for the purposes for which the Center has been using the premises, the Center shall have the option, to be exercised within thirty days after the filing of such eminent domain action, of canceling this lease effective as of the date the condemning authority shall take possession; provided, however, that if more than fifty percent of the floor area of the premises shall be taken under power of eminent domain, either party, by written notice to the other delivered on or before the date of surrendering possession to the public authority, may terminate this lease, effective as of such surrender of possession. 23026008 -7- i All compensation and damages of any type awarded for any taking, whole or partial, shall belong to and is the property of the County except as hereinafter provided. (c) Center's Damages. The Center shall have the right to claim and recover from the condemning authority, but not from the County, such compensation as may be separately awarded or recoverable by the Center in the Center's own right on account of any cost or loss to which the Center might be put in removing the Center's merchandise, finniture, fixtures and equipment. 17. Nonliability of County. The County and its agent shall not be liable to the Center for any damage or loss, including loss or interruption to the Centers business or services, occasioned by any service provided by the County or its agent under this lease for electricity, plumbing, gas, water, air conditioning, sprinkler or other pipes and sewage systems, or the loss, interruption or stoppage thereof, or by the bursting, leaking, overflowing or running over of any tank, washstand, closet, waste or other pipes in or about the premises or the property, nor for any damage occasioned by water coming into the premises from any source whatsoever or for any damage arising from any acts or neglect of the cotenants or other occupants of the property or of adjacent property, or of the public, unless such damage or loss shall result from a wanton and willful act of the County or the County's negligence. All property of the Center kept or stored on the premises shall be kept or stored at the risk of the Center only, and the Center shall hold the County harmless from any claims arising out of damage to the same, including subrogation claims by the Center's insurance carriers, unless such damage shall be caused by the wanton and willful act or negligence of the County. In no event shall the County or any of its agents, employees, or principals be liable to the Center, its principals, agents or employees, for lost profits or any other consequential damages suffered by the Center, its principals, agents or employees, from any cause, unless such losses or damages shall result from a wanton and willful act of the County or the County's negligence. 18. Defense of the County. The Center shall defend and save the County and its agent, if any, harmless against and from any and all claims, damages, costs and expenses, including reasonable attorney's fees, arising from the operation of the business conducted by the Center in the premises or arising from any default by the Center in the performance of any of the covenants, conditions or terms of this lease, or from any act or negligence or omission to act of the Center, its agents, contractors, servants, employees, sublessees, concessionaires or licensees in or about the premises or in connection with this lease or any sublease. 19. Notices. (a) Notices to the Center. All notices to be given to the Center may be given in writing and by depositing the same in the United States mail, registered or certified and postage prepaid, addressed to the Center at 34 Rainbow Drive, Hilo, Hawaii 96720. (b) Notice to the County. Notice to the County shall be given in writing personally to an agent or employee of the County or by depositing the same in the United States mail, registered or certified and postage prepaid, and addressed to the County at 25 Aupuni 23026008 -8- i Street, Hilo, Hawaii 96720, or at such other addresses as the County may give to the Center in writing from time to time. (c) Time of Service. Any written notice sent by registered or certified mail shall be deemed to have been served as of the date it is mailed in accordance with the foregoing provisions. 20. Insurance. Center shall maintain liability insurance not less than $750,000.00 at all times during the lease naming the County as an additional insured. Center shall provide a copy of the insurance certificate to the County and shall not reduce coverage, terminate, or otherwise alter the insurance without prior written approval of the County. 21. Force Maieure. In the event that either the County or the Center shall be delayed or hindered in or prevented from the performance of any act required under this lease agreement by reason of strikes, lockouts, labor troubles, inability to procure materials, failure of power, restrictive governmental laws or regulations, riots, insurrection, war, or other reason of like nature, not the fault of the party delayed in performing the work or doing the acts required under the terms of this lease agreement, then performance of such act shall be excused for the period of the delay and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay. 22. Additional Im rovements Upon Property. The County reserves the right, at any time, to make alterations or additions to, and to build additional stories on the building in which the premises are contained and to build in areas adjoining the premises. The County also reserves the right, from time to time, to construct other buildings or improvements on the property and to make alterations or additions thereto and to build additional stories on any such buildings and to build adjoining the same and to construct controlled or elevated parking facilities. 23. Entire Agreement. This lease contains the entire agreement between the parties, and any agreement hereafter made shall be ineffective to change, modify, discharge or effect an abandonment of the lease in whole or in part unless such agreement is in writing and signed by the party against whom enforcement of the change, modification, discharge or abandonment is sought. It is expressly understood and agreed that each and all of the provisions of this lease are conditions precedent to be faithfully and fully performed and observed by the Center to entitle the Center to continue in possession of the premises hereunder; that said conditions are also covenants on the part of the Center; and that time of performance of each is of the essence of this lease. 23026008 9 I IN WITNESS WHEREOF, the parties hereto have executed this lease the day and year first above written. COUNTY OF HAWAII By HAWAII ISLAND ADULT CARE, INC. BY FC14RO RECOMMEND APPROVAL: :4e 6 j(jI ~2L ~Y WILLIAM TAKABA Director of Finance APPROVED AS TO FORM AND LEGALITY: CRAIG T. MASUDA Deputy Corporation Counsel County of Hawaii IIAWAIIISLANDADULTCARE, INC. LEASE AGREEMENT LESSOR-COUNTY OF MWAIL LESSEE--HAWAIIISLANDADULT CARE, INC. TAXMAPKEY: (3)2-3-026.-008 (portion) 23026008 -10- STATE OF HAWAII ) ) SS. COUNTY OF HAWAII ) On before me personally appeared HARRY KIM, to me personally known, who, being by me duly swom, did say that HARRY KIM is the Mayor of the County of Hawaii, a municipal corporation of the State of Hawaii; that the seal affixed to the foregoing instrument is the corporate seal of said County of Hawaii; that the foregoing instrument was signed and sealed in behalf of the County of Hawaii by authority given to said Mayor of the County of Hawaii by Section 5-1.3(g) of the County Charter, County of Hawaii (2000), as amended; and said HARRY KIM acknowledged said instrument to be the flee act and deed of said County of Hawaii. Signature Name (Print or Type) Notary Public, State of Hawaii My Commission Expires: 23026008 -11- STATE OF HAWAII ) ) SS. COUNTY OF HAWAII On r~Il 3, before me appeared ` awV F L t to me personally known, who, being by me duly swom, did say that Sbl G ' C `Dt is the FC&1 d'=-04 of HAWAII ISLAND ADULT CARE, INC., a Hawaii corporation, that said instrument was 'signed on behalf of said corporation by authority of its Board of Directors; and that said `~1Yt15 acknowledged said instrument to be the free act and deed of said corporation. 14'tc~ Signature MTori an 0 Print or Type Name Notary Public, State of Hawaii My commission expires: Z l 23026008 -12-