HomeMy WebLinkAboutCRPS-07-021 - Lease Agreement - Williams Coffee PubJ
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Corporate Services
Report To: Committee of the Whole
Date of Meeting: February 5, 2007
Submitted By: Sian E. Williams
Assistant City Solicitor
Prepared By: Sian E. Williams
Assistant City Solcitor
Ward(s) Involved: N/A
Date of Report: February 1, 2007
Report No.: CRPS-07-021
Subject: AUTHORITY FOR EXECUTION OF LEASE AGREEMENT
WITH WILLIAMS COFFEE PUB INC.
RECOMMENDATION:
That the Mayor and Clerk be authorized to execute an agreement with Williams Coffee Pub Inc.
for the lease of the premises located on the ground level of City Hall, subject to the satisfaction
of the City Solicitor.
EXECUTIVE SUMMARY:
N/A
BACKGROUND:
Williams Coffee Pub Inc. has been the tenant of the ground level City Hall premises since 1993.
A new franchisee wishes to purchase the Williams Coffee Pub Inc. franchise for the City Hall
premises from the current franchisee. This is an opportune time to effect desirable changes to
the current lease and a new lease agreement between the City and Williams Coffee Pub Inc. is
therefore under consideration.
REPORT:
With the potential for a new franchisee the City has an opportunity to secure improvements to
the appearance and operation of the restaurant and washroom premises. Improvements to the
premises have been discussed with the tenant, Williams Coffee Pub Inc. The new franchisee is
also aware of the City's concerns in regard to the appearance and operation of the restaurant
and washroom premises.
The new lease agreement will be for a ten year term with a five year option to renew. The new
franchisee will make a minimum capital investment of $15,000.00 in March 2007 to immediately
effect improvements to the restaurant area and this will be matched by the tenant. The City as
landlord will provide a tenant inducement allowance of $51,980.00 to the tenant to cover
leasehold improvements. The City will recover the tenant inducement allowance over the term
of the lease. City staff are satisfied that the business plan of the new franchisee warrants the
City's improvement inducement. The City itself will commit to renovating the washrooms located
on the premises, in order to substantially improve lighting, to insert new wall and floor tile, to
paint all areas and to replace toilet partitions and paper dispensers, at an estimated cost of
$16,500.00.
The new lease agreement will contain provisions pertaining to the appearance and operation of
the restaurant and washroom premises to avoid disrepair, and to improve control over
pedestrian traffic flow into the washroom area. The specific wording of the terms of the new
lease agreement is currently under discussion and Legal will ensure that the City's interests are
protected in this matter.
FINANCIAL IMPLICATIONS:
Facilities Management is able to fund the leasehold improvements totalling $68,500.00 with
$28,000.00 from City Hall contingency and the remainder from various capital accounts. No
additional budget money is therefore required.
COMMUNICATIONS:
N/A
CONCLUSION:
Staff recognize that this is an opportune time to effect desirable changes to the restaurant and
washroom premises. The suggested terms of the new agreement with Williams Coffee Pub Inc.,
involving a new franchisee, will provide immediately for a fresh "look" for the premises, reflecting
well on all parties. A new lease agreement between the City and Williams Coffee Pub Inc. is
therefore advisable.
Sian E. Williams
Assistant City Solicitor