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Home My WebLink AboutTR-78-95 UNFINISHED BUSINESS THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON REPORT Meeting: GENERAL PURPOSE AND ADMINISTRATION COMMITTEE File # Date: MONDAY, DECEMBER 4, 1995 Res. #�l�� - ��• By-Law# Report#: TR-78-95 File#: Subject: SALE BY TENDER SD95-3 , ORONO ARMOURIES i Recommendations: It is respectfully recommended that the General Purpose and Administration Committee recommend to Council the following: I 1 . THAT Report TR-78-95 be received; 2 . THAT the attached By-law marked Schedule "A" be approved authorizing the Mayor and the Clerk to execute a lease agreement with 760719 Ontario Limited/Apogee Productions; and 3 . THAT 760719 Ontario Limited/Apogee Productions be advised of Council' s actions . BACKGROUND AND COMMENT: Subsequent to Report TR-73-95 (see Schedule "B" attached) , and Council Resolution #GPA-595-95 declaring the Orono Armouries . property as surplus land, an advertisement was placed in the local papers and the subject property was offered for sale by public tender. The tender documents that were issued included the following addendum: 1 . A total of 1, 097 square feet of space (front office) is available immediately, with the total building (3 , 953 j square feet) being available on or about May 1, 1996 . 2 . The Municipality will consider offers to purchase and offers to lease with option to purchase at a fixed price and on a date which is to be stipulated on the tender submission. RE i PIED P APED ECYL ILE THIS IS PR,RMLf IXJ RECYClFO PAPER REPORT NO. : TR-78-95 PAGE 2 SALE BY TENDER SD95-3 , ORONO ARMOURIES Subsequently, the following bids were submitted: BIDDER TOTAL BID COMMENT AMOUNT Alfred G. Bowen $40, 000 . 00 offer to purchase Bowmanville, Ontario 760719 Ont . Ltd. /Apogee Prod. $2 . 25 sq. offer to lease- Orono, Ontario ft . option to purchase For the information of Council, a property appraisal was completed on November 22 , 1995 with the property being appraised at $88 , 400 . 00 . As the offer to purchase the property in the amount of $40, 000 . 00 is less than the apprised value of $88, 400 . 00 , it is recommended that this offer not be accepted. i The offer to lease received from 760719 Ontario Limited/Apogee Productions, includes an option to buy the building at the 1994/95 assessed value . The option to buy could be exercised at anytime during the three year lease or for sixty days following the three year period. Apogee would also hold an option to renew the lease for a following three years without an option to buy. During the term of the lease the Municipality would undertake to keep the building envelope and heating equipment in good repair and provide two parking spaces in the area between the armouries and the Orono Town Hall . Under this lease agreement, the Clarke Museum will be able to utilize the existing storage area until May 1, 1996 . Staff will be addressing the issue of storage space requirements for the museum artifacts in the near future. i The Municipality' s solicitor has reviewed the proposed lease and it is therefore recommended that the offer be accepted. I 1 REPORT NO. : TR-78-95 PAGE 3 j SALE BY TENDER SD95-3 , ORONO ARMOURIES I Respectfully submitted, Reviewed by, ie Marano, H.BSc . ,AMCT. , W.H. Stockwell, Treasurer Chief Administrative Officer MM*LB*ld i i i I i SCHEDULE "A" THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON BY-LAW #95- Being a By-law to authorize the execution of an offer to Lease Agreement between the Corporation of the Municipality of Clarington and 760719 Ontario Limited o/a Apogee Productions in respect of a lease of the premises known as the Orono Armouries, Park Street, Orono, Ontario. THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON HEREBY ENACTS AS FOLLOWS : 1 . THAT the Mayor and Clerk are hereby authorized to execute on behalf of the Corporation of the Municipality of Clarington with the Corporation Seal, an Offer to Lease Agreement between 760719 Ontario Limited and Said Corporation; and By-law read a first and second time this day of December, 1995 . By-law read a third time and finally passed this day of December, 1995 . Mayor Clerk i I I SCHEDULE "B" GENERAL PURPOSE AND ADMINISTRATION COMMITTEE MONDAY, OCTOBER 23 , 1995 TR-73-95 LEASE AGREEMENT - ORONO ARMOURIES It is respectfully recommended that the General Purpose and Administration Committee recommend to Council the following: 1 . THAT Report TR-73-95 be received FORTHWITH; 2 . THAT the attached By-law marked Schedule "A" be approved, authorizing the Mayor and the Clerk to execute a lease agreement with 760719 Ontario Ltd. /Apogee Production; and 3 . THAT 760719 Ontario Ltd. Apogee Production be advised of Council' s decision. BACKGROUND AND COMMENT Currently the rear portion of Orono Armouries is being used by the Clarke Museum for storage of artifacts . The front offices have been vacated since the Youth Centre ceased their operations at this location several years ago. Staff recently received an expression of interest, through the Chief Administrative Office, from 760619 Ontario Ltd. /Apogee Productions for utilization of the complete building through a lease agreement . The total square footage of the building is 3 , 953 and a 3 year lease is proposed at a monthly rate of $741 . 18, which will be i reviewed annually and adjusted for inflationary increases . Subject to the review and comment of the Municipality' s solicitor, the proposed lease includes a purchase option up to sixty (60) days following the lease expiry, at a price based on the 1995 appraised value . I i REPORT NO. : TR-73-95 PAGE 2 LEASE AGREEMENT - ORONO ARMOURIES Before the tenant can utilize the entire space of the Armouries, the artifacts of the Clarke Museum will need to be relocated. Their space requirements are 2, 000 square feet which must be heated and secured. There are several options available regarding the Museum' s storage requirements including the use of some existing municipal facilities . Should Council approve the lease to purchase recommendation outlined in this report, details on the storage options will be brought to Council with specific recommendations . The area which would be rented initially is 1, 097 sq. ft . , at a monthly rate of $205 . 69 with the understanding that the complete building would become available within six (6) months . The lease rate proposed is substantially higher than the rate received for this building in its entirety in 1988 and is consistent with current market conditions . In addition, by leasing the facility, the Municipality will not be incurring costs as it relates to heat, water and fire safety equipment and incidental repairs . However, funds in an approximate amount of $2000 . 00 will need to be spent to upgrade various components of the building envelope and will be provided for in the Community Services 1996 Capital Budget . Similar to other lease arrangements, the Municipality will continue to be responsible for the building envelope and heating equipment . For the information of Council, over the past 4 years, the Municipality has, on 2 occasions, publicly advertised this property for sale with unacceptable prices being received. Further to this a written offer to purchase the property, conditional on zoning and financing has now been received. However, the offer in the amount of $50, 000 . 00 is lower than the 1994 appraised value of $95, 000 . 00 obtained for this property. REPORT NO. : TR-73-95 PAGE 3 LEASE AGREEMENT - ORONO ARMOURIES After further review of both the immediate offer to purchase and the offer to lease/purchase, it is recommended that the offer to lease submitted by 760719 Ontario Ltd. /Apogee Productions be accepted. Respectfully submitted, W.H. Stockwell, Chief Administrative Officer MM*LB*ld i i i i I