To: Mayor and City Council
From: Aaron Rector, Interim City Manager
Subject:
Title
Consider a resolution approving Amendment No. 2 of the Ground Lease Agreement with ME Development, approved by Resolution No. 4716, dated October 17, 2023, through a Chapter 380 Economic Development Program Agreement, pursuant to Chapter 380 of the Texas Local Government Code, and further authorizes the City Manager to execute said documents on behalf of the City of Keller, Texas.
Action Requested:
Consider a resolution amending the rent commencement date of the Ground Lease Agreement with ME Development LLC.
Background:
ME Development LLC., is proposing to build an approximately 60,000 to 75,000 square foot indoor sports facility for basketball, volleyball, cheer and futsal on undeveloped land at the Keller Sports Park.
This ground lease is summarized as follows:
* Lease of the 7.813 acres, more or less;
* Provides a lease term of 50 years;
* Rent payment of $15,000 per year;
* Establishes an escalating rent payment in 10-year increments;
* Controls use of facilities as recreational or approved by City.
Council approved the Ground Lease 380 Agreement on October 17, 2023 and it included a due diligence period of six (6) months, with rent commencing on April 1, 2024. On March 19, 2024, the City Council approved an extension to the due diligence period to June 17, 2024. This proposed Amendment No. 2 to the Ground Lease Agreement is extending the rent commencement date to July 1, 2024, to align with the new Due Diligence Period.
Legal Review:
The City Attorney’s Office has reviewed the proposed Ground Lease Agreement Amendment No. 2.
Alternatives:
City Council has the following alternatives:
- Approve as submitted
- Approve with changes
- Denial