AGENDA CAPTION:
Title
Consider approval of Resolution 2018-107R, approving an Amended and Restated Revised Lease of Unimproved Property for Construction and Operation of Business Facilities with Berry Aviation, Inc. for an aircraft hangar and tract of land at the San Marcos Regional Airport; authorizing the City Manager to execute the Agreement; and declaring an effective date.
Body
Meeting date: June 19, 2018
Department: Airport-Texas Aviation Partners
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Background Information:
In May 2017, City Council approved a 40-year ground lease for the construction of a maintenance facility for Berry Aviation Inc. ("Berry"). Berry has requested that their existing leases be amended to extend the term to match that of the ground lease. The proposed new deal clarifies and cleans up areas of confusion with two amended, new leases that improve our mutual business arrangement at the airport. This lease includes a 55,000 square foot City-owned hangar and an approximately 20,000 square foot hangar owned by Berry Aviation.
Additional changes were made, including:
• Separating hangar facilities from FBO and fueling facilities
• Clarification of leased premises and associated maintenance costs
• Addition of ground leased area to accommodate vehicle parking and storage
• Addition of periodic rent increases
• Removal of 1% gross revenue requirement, consistent with current leasing policy
There is a comparison of Berry's current lease and the proposed new lease prepared by Texas Aviation Partners attached as background. There are two agenda items relating to Berry: one approves Berry's Fixed Based Operator business and the other one Berry's aircraft business.
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Recommendation:
Texas Aviation Partners recommends approval.