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HomeMy WebLinkAboutCOM 0285.000 2014-2016William P. Kenoi Mayor April 17, 2015 County of Hawaii Finance Department 25 Aupuni Street, Suite 2103 • Hilo, Hawaii 96720 (808)961-8234 • Fax(808)961-8569 Dru Kanuha, Council Chair and Members of the Hawaii County Council Hawaii County Council 25 Aupuni Street Hilo, Hawaii 96720 Re: Resolution for multi-year lease Deanna S. Sako Director Lisa K. Miura Deputy Director s gni The Finance Department's Vehicle Registration and Licensing (VRL) Division seeks office space in the Waimea Center, Waimea Hawaii, in order to relocate from their present location within the Hawaii Police Department's Waimea Station which will no longer be available for their use. This office space is owned and operated by Puna Plantation of Hawaii, Limited, who will make improvements to accommodate the VRL operation. Enclosed is a resolution authorizing the County to enter into a ten year, multi-year lease agreement for this office space. We request that this resolution be waived from the Finance Committee and be placed on the May 6, 2015 Council agenda in order to expedite this relocation. If there are any questions, please feel free to contact Hamana Ventura of the Finance Department's Property Management Division at 323-4321. Deanna S. Sako Director of Finance Enc. CDC-) _Cp S� t, M D cc: VRL Comm. No, aK Ref. To: w FLT Hawaii County is an Equal Opportunity Employer and Providdt ef• ()ata APR 17 2015 Form #: B-52 7/18/91 DEPARTMENT OF FINANCE REQUEST FOR COUNCIL ACTION DEPARTMENT: Finance DATE: STAFF CONTACT: Hamana Ventura A. REQUEST: 4/07/15 PHONE: 808-323-4321 Please prepare a resolution authorizing the payment of funds - in a later fiscal year and for more than one fiscal year - for a 10 year intitial lease with two (2) 5 year options to Lease approx. 2,190 sq ft at Waimea Center for Vehicle Registration and Licensing (VRL). The monthly per sq ft rent schedule is as follows: For year 1 monthly base rent shall be $2,737.50 For year 2 monthly base rent shall be $2,803.20 For year 3 monthly base rent shall be $2,868.90 For year 4 monthly base rent shall be $2,934.20 For year 5 monthly base rent shall be $3,000.30 For year 6 monthly base rent shall be $3,066.00. For year 7 monthly base rent shall be $3,131.70. For year 8 monthly base rent shall be $3,197.40. For year 9 monthly base rent shall be $3,263.10. For year 10 monthly base rent shall be $3,328.80. B. BACKGROUND AND JUSTIFICATION (USE ADDITIONAL SHEETS AS NEEDED): In an effort to provide expanded services to the Waimea and Honoka'a areas, VRL is looking to move out of the Police Station in Waimea to the Waimea Center. This is designed to reduce congestion in both Kona and Hilo. SIGNED: L&'o DATE: Lg1111- Department Head LAND COURT REGULAR SYSTEM (AREA ABOVE RESERVED FOR RECORDING INFORMATION) After Recordation, Return by ® Mail or ❑ Pick-up Phone#: 961-8251 FILL IN NAME AND ADDRESS BELOW: Office of the Corporation Counsel (CTM) 101 Aupuni Street, Suite 325 Hilo, Hawaii 96720 DOCUMENT CONTAINS PAGES TITLE OF DOCUMENT: COUNTY OF HAWAPI OFFICE AND SPACE LEASE AGREEMENT PARTIES TO DOCUMENT LESSOR/LANDLORD: LESSEE/TENANT: PUNA PLANTATION HAWAPI, LTD. c/o BARRY TANIGUCHI 50 E. Puainako Street Hilo, Hawaii 96720 COUNTY OF HAWAPI 25 Aupuni Street Hilo, Hawaii 96720 AFFECTS TAX MAP KEY: (3) 6-5-005-003(por.) COUNTY OF HAWAII OFFICE AND SPACE LEASE AGREEMENT This LEASE AGREEMENT, made this day of , 2015, by and between PUNA PLANTATION HAWAII, LTD. c/o BARRY TANIGUCHI., whose mailing address is 50 E. Puainako Street, Hilo, Hawaii 96720 (hereinafter referred to as "Landlord" or "Lessor"), 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 "Tenant" or "Lessee"). 1. Grant. In consideration of the rents, covenants, and agreements hereinafter reserved and contained and on the part of the Tenant to be observed and performed, the Landlord demises and leases to the Tenant, and Tenant rents from the Landlord, the following for use as an office space for the Tenant: Those certain premises consisting of approximately 2,190 square feet of office space, in the Waimea Center, identified as space No. 1-A, located at 65-1158 Mamalahoa Hwy., District of Waimea, County and State of Hawaii, and hereinafter "the premises", more particularly described in Exhibit A. Together with the full right of access to said premises in common with others over, across, and through any alleys, common entrances, lobbies, stairways, halls, elevators, and corridors in or around said building. 2. Use and Fitness. The premises shall be fit to be utilized as an office space for the Division of Vehicle Registration and Licensing. Term. The term of this lease and the Tenant's obligation to pay rent hereunder, shall be for ten (10) years, commencing on July 1, 2015 to June 30, 2025, or the date of delivery of the space suitable for occupancy under the terms of this lease agreement, whichever is later. 4. Option. Tenant shall have the option of two additional five (5) year terms at a rental rate to be negotiated based on then existing fair market rental amounts. Delivery of Possession. If the Landlord, for any reason, cannot deliver possession of the demised premises to the Tenant at the commencement of the lease term, as specified above, this lease agreement shall not be void or voidable; but in that event, Landlord shall defer the obligation to pay rent until such occupancy, however the expiration date of the lease shall not be adjusted back and the lease will expire on June 30, 2025. 2 6. Quiet Enjoyment. Landlord agrees that upon payment by the Tenant of the rent herein provided and upon the faithful observance and performance of all the covenants, terms, and conditions in this lease on the part of the Tenant to be observed and performed, the Tenant shall peaceably and quietly hold and enjoy the leased premises for the term of this lease without hindrance or interruption by the Landlord or any other person or persons lawfully or equitably claiming by, through, or under the Landlord. 7. Rent. Tenant shall pay to the Landlord, in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, without any setoff or deduction whatsoever. A common area maintenance charge of SEVENTY FIVE CENTS per square foot, per month ($0.75/sq. ft./month) subject to yearly adjustment based on operating costs, will be paid in addition to the base rent which is established as follows: Year Base Rent 1 $2,737.50 Plus CAM, GE Tax and Interest 2 $2,803.20 Plus CAM, GE Tax and Interest 3 $2,868.90 Plus CAM, GE Tax and Interest 4 $2,934.20 Plus CAM, GE Tax and Interest 5 $3,000.30 Plus CAM, GE Tax and Interest 6 $3,066.00 Plus CAM, GE Tax and Interest 7 $3,131.70 Plus CAM, GE Tax and Interest 8 $3,197.40 Plus CAM, GE Tax and Interest 9 $3,263.10 Plus CAM, GE Tax and Interest 10 $3,328.80 Plus CAM, GE Tax and Interest Tenant reserves the right to prepay rent one year in advance. Excise Tax. In addition to the base rent, the Tenant shall pay the Hawaii general excise tax (currently 4.166%), or any successor tax, which may be payable thereon. 9. Real Property The Tenant shall be responsible for its pro -rata share of the real property taxes. 10. Deposit. No deposit shall be required. 11. Special Conditions. (a) Landlord at Landlord's expense shall improve the premises to meet County specified plans as stated in the Improvement Agreement. The improvements shall not exceed $250,000.00, (b) County shall reimburse improvement costs over a 10 year period at an interest rate of 4.5% annually, (c) Landlord shall maintain plumbing and roof for the duration of the lease term, provided that County shall be responsible for janitorial services for the units interior restroom, and (d) For individuals who are banned from Waimea Center, those individuals shall be allowed to conduct their county business. Waimea Center security can request the banned individuals to leave once their county government business is completed. 12. Common Area Maintenance and Building Services. The common area maintenance charge shall be paid monthly, in addition to the rent, and at the rate noted in paragraph 7 of this lease agreement. Landlord shall operate and maintain the property, common area and facilities therein in a manner deemed as reasonable, appropriate and in the best interest of the tenants of the property. Landlord shall be responsible for all building services included in the CAM charges as provided by Waimea Center. Such services shall include, but not be limited to electricity; water; supplies for restroom; janitorial services; trash removal for common areas and dumpster for Tenant use. All such expenses for the maintenance and operation shall be included in the rental charge. The term "common area and facilities" as used in this lease agreement shall be deemed to include those portions of the property as are designated and/or designed for the non-exclusive use of the Tenant in common with other authorized users, and shall include, but not be limited to: parking areas; roadways; service areas; driveways; areas of ingress and egress; landscaped and planted areas; sidewalks and other pedestrian ways; corridors; courts; public washrooms; drinking fountains; community rooms; toilets; stairs; ramps; buildings or structures used in connection with the maintenance of said common area; and all other similar facilities, from time to time provided for the joint use and convenience of such authorized users. 13. Hold Over Rent. Any holding over after the expiration of the term hereof, with the consent of Landlord, shall be construed as a tenancy from month-to-month. Rent for any hold over period after the expiration of this lease shall be at a rate of the last month's rent and CAM, and all other terms of this lease agreement shall apply. 14. Utility and Similar Charges. Landlord shall ensure that all utilities are stubbed to the premises. Within the leased premises, the Tenant shall be responsible for janitorial maintenance of the interior of the leased space; electricity as determined on a pro rata basis; trash removal to a common area dumpster; telephone services; and any other special services that may be required by the Tenant. 15. Assignment and Sublease. Tenant shall not, without the prior written consent of Landlord, which consent will not be unreasonably withheld, assign or mortgage this lease or any interest herein, or sublet or grant any concession or license to use the premises or any part thereof, or allow any other person to use the whole or any part of the premises. 16. Use and Maintenance of Premises. Tenant shall use the leased premises solely for the purpose of office and warehouse space and shall not use the same for any other purpose without the prior written consent of Landlord. Tenant shall not make or suffer any waste, strip or unlawful, improper, or offensive use of said premises. Tenant shall not do or suffer any act or carry on any practice which may damage the premises or become a nuisance to other tenants and owners in the building in which the premises are located. Tenant shall keep the premises in good order, condition and repair, and in a strictly clean and sanitary condition. 17. Inspection. As a secured governmental office, Landlord and Landlord's agents will be allowed to enter said premises to examine the state of repair and condition thereof upon reasonable notice to Tenant. Such inspection shall occur during normal business hours unless 4 agreed to by Tenant and the Landlord and/or Landlord's agent shall be escorted at all times by a County designee. 18. Sites. Tenant shall not, without the prior written consent of Landlord, erect, install, or affix any sign about the exterior or on the windows of the premises. Tenant shall allow Landlord, during the last three (3) months of the term of this lease, to affix or keep on the premises a "For Lease" or "For Sale" notice. 19. Alterations. Tenant shall not, without the prior written consent of Landlord, make any alterations or additions to said premises. 20. Landlord's and Agent's Immunity and Insurance. The Tenant is self-insured for liability arising out of Tenant's use of the leased premises and/or any damages, claims of damages, or lawsuits for same, by anyone using or in the leased premises, and shall hold harmless and indemnify and defend Landlord, if the Landlord is named as a defendant in any such suit. 21. Surrender. The Tenant shall, at the end of the term of this lease or earlier termination thereof, peaceably and quietly vacate and deliver up to Landlord the possession of the premises, together with all additions and alterations made by Tenant, unless Landlord requires removal of the same in good order, condition and repair, reasonable wear and tear excepted. Tenant may remove all moveable trade fixtures (if installed by Tenant) on the condition that Tenant shall repair any damage to the premises resulting from the removal of said fixtures. Any property of the Tenant remaining on the premises after the termination of the lease may be disposed of by the Landlord in any manner it sees fit, without any liability whatsoever to the Landlord. The proceeds of such disposition, if any, shall be the sole property of the Landlord. 22. 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 Tenant, 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 Tenant has been using the premises, the Tenant shall have the option, to be exercised within thirty (30) 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 (50%) of the floor area of the premises shall be taken under power of eminent domain, either party, by written notice to the other party, delivered on or before the date of surrendering possession to the public authority, may terminate this lease, effective as of such surrender of possession. All compensation and damages of any type awarded for any taking, whole or partial, shall belong to and is the property of the Landlord, except as hereinafter provided. 23. Destruction of Premises. If the premises are partially or totally damaged or destroyed by fire or other casualty so as to become partially or totally untenantable, such damage or destruction, insofar as the same pertains to the building itself, exclusive of any damage to Tenant's fixtures, furniture or other property, shall be repaired or rebuilt at the discretion of the Landlord. Landlord shall advise Tenant within sixty (60) days after the casualty whether it intends to rebuild or repair. If the Landlord elects not to repair or rebuild, this lease shall terminate without further notice and the obligations of either party shall cease. No rent shall be payable from the date such casualty occurs until the repair or rebuilding shall be completed, unless the premises shall be tenantable and there is no substantial interference with Tenant's business. 24. Subordination of Lease to Mortgage. Tenant agrees that this lease and all rights of Tenant hereunder shall be subject and subordinate to all present and future mortgages made or to be made by Landlord as security for any indebtedness of Landlord; provided, however, that the mortgagee shall agree to recognize this lease in the event of foreclosure and will cause the sale of said premises to be made subject to Tenant's lease, provided that the Tenant is not in default under any of the terms, conditions, or covenants of this lease at the time of such foreclosure. 25. Parking. Tenant shall have the right to shared used of the Waimea Center parking. 26. Additional Construction or Remodeling. Landlord reserves the right to remodel, repair, paint, or renovate the said building or do additional construction at any time. Said work shall be undertaken by Landlord with minimum interference or inconvenience to Tenant's use of the premises, and any interference or inconvenience resulting to Tenant or its use of the premises shall not constitute a breach or violation of Landlord's covenant of quiet enjoyment or any other covenant. If Landlord's additional work requires entry into Tenant's premises, Landlord and Tenant shall enter into a written agreement on the terms and conditions of such entry and work. 27. Americans with Disabilities Act. Landlord affirms and shall ensure that the building, all improvements and its common areas comply with Title III of the Americans with Disabilities Act ("ADA"). 28. Non -waiver of Breach. The acceptance of rent by Landlord shall not be deemed a waiver by Landlord of any breach by Tenant or of the right of Landlord to terminate this lease for any such breach, and that the failure of Landlord to insist upon strict performance of any covenant or condition of this lease, or to exercise any option herein conferred, shall not be C.1 construed as a waiver or relinquishment for the future of any such covenant or condition but the same shall remain in full force and effect. 29. Notice. a. Notices to the Tenant. All notices to be given to the Tenant should be given in writing and by depositing the same in the United States mail, registered or certified, postage prepaid, and addressed to the County of Hawaii at 25 Aupuni Street, Hilo, Hawaii 96720. b. Notice to Landlord. Notice to Landlord shall be given in writing personally to an agent or employee of Landlord or by depositing the same in the United States mail, registered or certified, postage prepaid, and addressed to Landlord at 65-1158 Mamalahoa Hwy, Suite 22-A, Kamuela, Hawaii, 96743 or at such other addresses as Landlord may give to the Tenant 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. 30. Force Majeure. In the event that either Landlord or Tenant shall be delayed, hindered, 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 parry 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. 31. Hazardous Materials. The Landlord affirms, upon due diligence, that the premises are free of hazardous materials. Landlord warrants that it has not received written notice from any governmental authority having jurisdiction over the premises that the premises is in violation of the Comprehensive Environmental Response, Compensation and Liability Act of 1989, as amended ("CERCLA"), the Resources Conservation and Recovery Act of 1976, as amended ("RCRA"), the Toxic Substance Control Act, as amended, the Hazardous Materials Transportation Act, as amended, or any statute governing underground storage tanks or asbestos. Landlord represents and warrants that to Landlord's actual knowledge (without undertaking any investigation or inquiry) the premises do not contain any hazardous or toxic materials prohibited by law. Landlord shall indemnify and hold harmless the Tenant from and against any and all claims, demands or losses in connection with the release of hazardous or toxic materials caused by Landlord. Tenant shall indemnify and hold harmless the Landlord from and against all claims, demands or losses in connection with the release of hazardous or toxic materials caused by Tenant, its agents or employees. 32. Construction of Language. Nothing herein contained is intended or shall be construed as creating a relationship of principal and agent, or of a partnership or joint venture, between Landlord and Tenant. Wherever used herein, the singular number shall include the plural and the neuter gender shall include the masculine and feminine genders, unless the context clearly requires otherwise. The obligations of the parties executing this lease agreement shall be joint and several. The term "premises" shall mean the premises demised under the lease; the term "Landlord" shall include the Landlord, its successors, and assigns; and the term "Tenant" shall include Tenant and Tenant's successors and permitted assigns. 33. Facsimiles. The parties hereto agree that telephone facsimile (fax) copies of any documents required to be executed by the provisions herein will be accepted as if signed in person, as originals. Upon request, the party submitting the facsimile shall provide the original document within a reasonable time. However, failure to provide such an original shall have no effect upon the validity of the execution by facsimile. 34. Dispute Resolution/Forum Selection. Any dispute action or proceeding involving this lease, commenced by any party, if not resolved by mutual consent, shall be commenced in the District Courts of the Third Circuit, County and State of Hawaii. 35. Governing It is agreed that this lease agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Hawaii. 36. Special Conditions. This offer shall be subject to the approval of the Hawaii County Council. Tenant shall have the right to terminate this lease at any time after two years upon 120 day notice to Landlord. 37. Agency Disclosure. The County of Hawaii is represented by the Property Management Division, Department of Finance, County of Hawaii in this transaction. 38. Entire Agreement. This lease agreement, along with the accompanying Offer to Lease for the aforementioned premises, contains the entire agreement between the parties. 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 agreement are conditions precedent to be faithfully and fully performed and observed by the Tenant and to entitle the Tenant to continue in possession of the premises hereunder; that said conditions are also covenants on the part of the Tenant; and that time of performance of each is of the essence of this lease. IN WITNESS WHEREOF, the parties hereto have entered into this agreement as of the day and year first above written. PUNA PLANTATION HAWAII, LTD. c/o BARRY TANIGUCHI. Name: Title: COUNTY OF HAWAII RECOMMEND APPROVAL: By: Deanna Sako Director of Finance APPROVED AS TO FORM AND LEGALITY: CRAIG T. MASUDA Deputy Corporation Counsel County of Hawaii 0 1 rc_ _ 0' : ►I6 •' 1 LESSEE/TENANT STATE OF HAWAII ) SS. COUNTY OF HAWAII ) On , before me personally appeared to me personally known, who, being by me duly sworn (or affirmed), did say that is the of Puna Plantation Hawaii, LTD., that said instrument was signed in behalf of the corporation by authority of its board of directors, and acknowledged the instrument to be the free act and deed of the incorporation. NOTARY CERTIFICATION Doc. Date: Notary Name: Doc. Description: Date Signature Print or Type Name Notary Public, State of Hawaii My Commission Expires: No. of Pages: 10 Circuit STATE OF HAWAII ) COUNTY OF HAWAII ) On this day of SS. 2015 before me personally appeared WILLIAM P. KENOI, to me personally known, who, being by me duly sworn, did say that he 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, the foregoing instrument was signed and sealed on behalf of the County of Hawaii by authority given to said Mayor of the County of Hawaii by Sections 5-1.3 and 13-13 of the County Charter, County of Hawaii (2010), as amended, and said WILLIAM P. KENOI acknowledged said instrument to be the free act and deed of said County of Hawaii. NOTARY CERTIFICATION Doc. Date: Notary Name: Doc. Description: N Date Signature Print or Type Name Notary Public, State of Hawaii My Commission Expires: No. of Pages: Third Circuit 11 EXHIBIT A KAREN EOFF Chairperson VALERIE T. POINDEXTER Vice Chair ,�r April 17, 2015 HAWAII COUNTY COUNCIL Dru Mamo Kanuha, Chairperson Hawaii County Council 25 Aupuni Street Hilo, Hawaii 96720 RE: Resolution No. 181-15 County of Hawai `i Hawaii County Building 25 Aupuni Street Hilo, Hawai `i 96720 AARON S.Y. CHUNG MAILE "MEDEIROS" DAVID GREGGOR ILAGAN DRU MAMO KANUHA DENNIS "FRESH" ONISHI DANNY PALEKA MARGARET WILLE RESOLUTION AUTHORIZING THE PAYMENT OF FUNDS OF A LATER FISCAL YEAR AND OF MORE THAN ONE FISCAL YEAR FOR A MULTI-YEAR LEASE OF REAL PROPERTY FOR THE DEPARTMENT OF FINANCE, DIVISION OF VEHICLE REGISTRATION AND LICENSING, WAIMEA OFFICE Pursuant to Section 2(g) of Rule 4 of the Rules of Procedure of the Council of the County of Hawaii, this written request is submitted with my approval that the above -referenced matter be waived from the Committee on Finance to the full Council for immediate action. In reviewing this matter, timely approval is crucial. It is therefore advantageous that approval is granted and the matter be placed onto the next Council agenda for review. However, in the event this request is denied, for whatever reason, I understand the matter shall be referred to the Committee on Finance for placement on its future agenda. Sincerely, Karen Eoff, Chairperson Committee on Finance pprov / ate/Waive to Council: Disapproved/Date/Refer to FC: AL/i7/l5 Dru Mamo Kanuha, Chairperson Dru Mamo Kanuha, Chairperson Hawaii County Council Hawaii County Council KE/wb Hawaii County is an Equal Opportunity Provider and Employer