HomeMy WebLinkAbout4.11 Property Mgmt Svcs Dulbin Square
CITY CLERK
File # D[lJ0[QJ-~[Q]
AGENDA STATEMENT
CITY COUNCIL MEETING DATE: May 15,2007
SUBJECT:
Agreement with Straface & Riele Commercial Real Estate to
provide Property Management Services for the Dublin Square
Shopping Center
Report Prepared by: Christopher 1. Foss
Economic Development Director
ATTACHMENTS:
1) Resolution Approving a Property Management Agreement with
Straface & Riele Commercial Real Estate for the Property Located at
11759 Dublin Boulevard (Dublin Square Shopping Center), with
Agreement attached as Exhibit A
2) Budget Change Form
RECOMMENDATIO~
\
1) Adopt the proposed resolution approving the Property
Management Agreement with Straface & Riele Commercial Real
Estate for the property located at 11759 Dublin Boulevard (Dublin
Square Shopping Center), with Agreement attached as Exhibit A;
and
2) Approve the Budget Change.
FINANCIAL STATEMENT:
Property Management Services fees will cost $1,100 per month, and
there are funds available to cover these expenses.
DESCRIPTION: On May 1,2007, the Dublin City Council approved a Purchase and
Sale Agreement, as well as an Assignment and Assumption of Leases Agreement, with the Berkeley Land
Co. to acquire 11759 Dublin Boulevard (the Dublin Square Shopping Center) as part of Capital
Improvement Program (CIP) Project No. 95556 - Dublin Historic Park Acquisition (Heritage Center
Expansion). At the same meeting, the City Council approved the Final Relocation Impact Statement to
identify the needs of the 13 affected businesses located at the property that would need to be relocated.
To assist City Staff in managing the property during the tenant relocation process, Staff received a
proposal from Straface & Riele Commercial Real Estate to provide property management services.
COPY TO:
Page 1 of2
ITEMNO.~
G:\Chris\Berkeley Land\Agenda statement Straface May 15 2007 Final doc. DOC
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Straface & Riele Commercial Real Estate is a full service commercial real estate firm that has focused on
the Tri-Valley for nearly 30 years. The firm has managed, leased and/or sold approximately 350,000
square feet of commercial buildings in Dublin over the past several years, and are currently managing 8
properties in the Tri- Valley area.
The property management agreement calls for Straface & Riele's responsibilities to include: Collection of
rents and operating expenses from tenants, receive and pay bills for services provided at the property,
communicate with and react to tenants' needs, administer the terms and conditions of all leases, and
provide the City with detailed monthly financial statements. The fees for the services provided will be a
fixed fee of $1,100 per month. The agreement also calls for the payment of start-up costs by Straface &
Riele. The proposed agreement can be terminated by either party with thirty (30) days written notice.
The property management agreement constitutes an agreement for professional services, and is therefore
exempt from competitive bidding requirements pursuant to Section 2.36.050A.l of the Dublin Municipal
Code. Staff would also request, through approval of this item, that the City Treasurer be authorized to
establish financial accounts as necessary for this project.
The proposed budget change will account for the income derived from the pro-rated May 2007 rents that
have been collected as well as the expenses related to property management (services ofStraface & Riele
as well as monthly maintenance expenses through the end of June 2007..
RECOMMENDATION: Staff recommends that 1) the City Council adopt the proposed resolution
approving the Property Management Agreement with Straface & Riele Commercial Real Estate for
property management services at 11759 Dublin Boulevard (Dublin Square Shopping Center), with
Agreement attached as Exhibit A and 2) Approve the Budget Change
'P(t ~ 2-
'1(;,
RESOLUTION NO. -07
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
**********************
APPROVING A PROPERTY MANAGEMENT AGREEMENT WITH STRAFACE &
RIELE COMMERCIAL REAL ESTATE FOR PROPERTY MANAGEMENT
SERVICES FOR THE PROPERTY LOCATED AT 11759 DUBLIN BOULEVARD
(DUBLIN SQUARE SHOPPING CENTER)
WHEREAS, at the May 1,2007 City Council Meeting, the City Council of the City of
Dublin (the "City") approved a Purchase and Sale Agreement, as well as an Assignment and
Assumption of Leases Agreement, with the Berkeley Land Co. to acquire the real property
located at 11759 Dublin Boulevard (the "Dublin Square Shopping Center") as part of Capital
Improvement Program (CIP) Project No. 95556 - Dublin Historic Park Acquisition (Heritage
Center Expansion); and
WHEREAS, at the same City Council Meeting, the City Council approved the Final
Relocation Impact Statement to identify the needs of the 13 affected businesses located in the
Dublin Square Shopping Center; and
WHEREAS, Staffhas determined it necessary to hire professional property management
services to serve the Dublin Square Shopping Center properties on behalf of the City during the
tenant relocation process; and
WHEREAS, Straface & Riele Commercial Real Estate provides expertise in property
management services with a particular focus in management of Tri-Valley properties; and
WHEREAS, Staff recommends that the City execute a Property Management
Agreement, attached hereto as Exhibit A, with Straface & Riele Commercial Real Estate (the
"Agreement"); and
WHEREAS, the Agreement has been reviewed and approved by the City Attorney's
Office.
NOW, THEREFORE, BE IT RESOLVED that the Agreement between the City of
Dublin and Straface & Riele Commercial Real Estate is hereby approved by the City Council of the
City of Dublin and the City Manager is hereby authorized and directed to execute the Agreement in
the form attached as Exhibit A.
PASSED, APPROVED AND ADOPTED BY this 15th day of May 2007 by the following vote:
AYES:
Page 1 of2
51'Qo7 1.+e.n,#-~}}
Attachment 1
NOES:
ABSENT:
ABSTAIN:
ATTEST:
City Clerk
2t2;fG
Mayor
966205_1; 114.4019
Page 2 of2
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STRAFACE & RIELE COMMERCIAL REAL ESTATE
4125 Blackhawk Plaza Circle, Suite 260, Danville, California 94506
(925) 736-1578
PROPERTY MANAGEMENT AGREEMENT
This agreement made by and between CITY OF DUBLIN ("Owner") and STRAFACE & RIELE COMMERCIAL
REAL ESTATE ("Agent"), who agree as follows:
1. Appoint of Agent and Termination:
Owner employs Agent exclusively to operate, and manage the property known and described as: 11759 Dublin
Boulevard (Dublin Square Shopping Center), on the terms set forth below beginning Mav 16. 2007 and continuing until
terminated by either party giving the other at least thirty (30) days prior written notice of the termination date. In the event of
such termination, settlement of accounts between Owner and Agent will be made as of the termination date. Owner assumes all
responsibility for gas, electric, water, sewer, garbage and other services for the property, loan payments, insurance, taxes,
assessments, and all other expenses related to the property upon giving notice oftermination to Agent.
2. Agents Covenants:
a.) Agent shall use its best efforts to perform the Management Services consistent with first-class professional
management practices so that the Premises are managed, operated, and maintained in a first-class manner appropriate for retail
properties in the area in which the Premises are located. Without limiting the generality of the foregoing, Agent shall perform the
Management Services in accordance with Applicable law and upon the terms and conditions of this Agreement so that (i)
Owner's interest in the Premises and its interest as Landlord under the Leases shall be preserved and no default chargeable to
Owner shall occur under the Leases or the Contracts; (ii) no policy of insurance held by Owner might be invalidated; and (iii) no
loss insured under such insurance would be rendered uncollectible. Agent shall use its best efforts to secure full compliance by
the tenants under the Leases with the terms and conditions of the Leases.
b.) Agent shall render monthly statements of receipts, expenses, and charges and shall keep and maintain a
segregated, comprehensive, and organized system of office records, books, and accounts with respect to Agents duties under this
Agreement. In the event the expenses shall be in excess of the rents collected by Agent, Owner agrees to pay such excess
expenses promptly upon demand of Agent. If Owner does not pay the excess expenses within 30 days after Agent's demand,
Owner agrees to pay Agent a service fee of $1 00.00 per month until the excess expenses are paid in full.
c. Accumulate as a reserve in Owner's account each month approximately one-twelfth of the real property
taxes, bond payments or assessments, if any, and to pay same when due.
d. Deposit all receipts collected for Owner (less any sums properly deducted or otherwise provided by this
agreement) in a trust account in a national or state institution qualified to engage in the banking or trust business, separate from
Agent's personal account. Agent will not be held liable in the event of bankruptcy or failure of a depository.
3. Agent Authority and Obligations:
Owner gives to Agent the following authority and powers and agrees to pay any all expenses related to the following:
a. To collect rent or other charges and expenses due or to become due and give receipts therefor; to terminate
tenancies and to sign and serve in the name of Agent such notices as are appropriate; to institute and prosecute legal actions; to
evict tenants and to recover possession of said premises; to sue for in the name of Agent and recover rents and other sums due;
and when expedient, to settle, compromise, and release such actions or suits or reinstate such tenancies; provided however, that
such actions must be reviewed and approved in writing by Owner in advance. Owner agrees to pay all costs and expenses,
including attorney's fees, for such legal actions or proceedings.
b. To make or cause to be made and supervise repairs and alterations, and to do decorating on said premises;
to purchase supplies and pay all such expenses. Agent agrees to secure the prior approval of the Owner on all expenditures in
excess of $5,000.00 for anyone item, except monthly or recurring operating charges and/or emergency repairs in excess of the
maximum, if in the opinion of Agent such repairs are necessary to protect the property from damage or prevent damage to life or
to the property of others or to avoid suspension of necessary services or to avoid penalties or fines or to maintain services to the
tenants as called for in their leases.
c. To hire, discharge and supervise all labor and employees required for the operation and maintenance of the
premises; it being agreed that all employees shall be deemed employees of Owner and not Agent, and that Agent may perform
Exhibit A
4 rot 0
any of its duties through Owner's attorneys, agents, or employees and shall not be responsible for their acts, defaults or
negligence if reasonable care has been exercised by Agent in their appointment and retention.
d. To make contracts for electricity, gas, fuel, water, telephone, window cleaning, trash or rubbish hauling
and other services or such ofthem as Agent shall deem advisable.
e. To pay mortgage indebtedness, property and employee taxes and special assessments.
4. Agents Compensation:
a. Owner agrees to pay Agent as compensation for Agents services under this Agreement: $1,100.00 per
month for management services. Agent shall be entitled to withdraw Management Fees from Owner's funds in the Trust Account
in arrears monthly on the 5th day of each month. Owner further agrees to compensate Agent One Thousand and 00/100 dollars
($1,000.00) for the initial time and expense of tenant and vendor information as well as an inspection of the property and its
components by Agent and its consultants.
5. Insurance and Indemnity:
Owner further agrees:
a. To carry, at Owner's sole cost and expense, public liability, property damage, and workers' compensation
insurance as shall be adequate to protect the interests of Agent and Owner, the policies for which shall name Agent as well as
Owner of Agent and Owner, the policies for which shall name Agent as well as Owner as the party insured. Such insurance shall
have a single combined liability of not less than $1,000,000 and property damage limits of not less than $1,000,000.
b. To indemnify and hold Agent completely harmless from any and all costs, expenses, attorney's fees, suits,
liabilities, damages or claim for damages, including but not limited to those arising out of any injury or death to any person or
persons or damage to any property of any kind whatsoever and to whomsoever belonging, including Owner, in any way relating
to the management of the premises by Agent or the performance or exercise of any of the duties, obligations, powers or
authorities herein or hereafter granted to Agent. Agent shall not be liable for any error of judgment or for any mistake of fact or
law, or for anything, which it may do or refrain from doing, except in cases of willful misconduct or gross negligence.
c. Agent agrees to carry Errors and Omissions insurance at all times while this Agreement is in effect.
AGENT SHALL HAVE NO RESPONSIBILITY FOR OWNER'S SELECTION OF
INSURANCE POLICIES, COVERAGES, LIMITS, OR THE EXPIRATION,
EXTENSION, RENEWAL OR CANCELLATION OF SUCH POLICIES.
6. Successors and Assigns:
This agreement shall be binding upon the successors and assigns of Agent, and the heirs, administrators, executors,
successors and assigns of Owner. If it shall become necessary for Agent or Owner to give notice of any kind, the same shall be
given, and shall be complete, by sending such notice by certified mail, return receipt requested, to Owner at the address shown
below and to Agent at 4125 Blackhawk Plaza Circle, suite 260, Danville, California 94506.
Owner acknowledges receiving a copy ofthis agreement.
Dated:
,2007, at Danville, California.
All statements and funds shall be mailed to Owner at:
OWNER:
BY:
DATE:
TAXPAYER ID#
5O:fG
STRAFACE & RIELE COMMERCIAL REAL ESTATE
By
DATE:
masters\mgmtagre.doc
CITY OF DUBLIN
BUDGET CHANGE FORM
~'10
CHANGE FORM #
New Appropriations (City Council Approval Required):
Budget Transfers:
From Unappropriated Reserves (Fund)
From Budgeted Contingent Reserve (1080-799.000)
Within Same Department Activity
Between Departments (City Council Approval Required)
Other
xx From New Revenues
Account #:
EXPENSE $ 6,200
Name: General Fund - Building Management
- Contract Services
Name:
$
Account #: 001-10500-740-000
REVENUE
Name: General Fund - Building Rental
$ 11,950
Account #:
Name:
Account #:001-551-003
Name:
Account #:
Name:
Account #:
Name;
Account #:
Name:
Account #:
Name:
Account #:
Account #:
Fin Mgr/ ASD:
RJ ;z". c:?---=)
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Signature
Date: 5/Q/zt>oi-
.
REASON FOR BUDGET CHANGE ENTRY: The City has acquired property to develop an addition to the
Heritage Park. Prior to developing the park there will be a need to manage the property and collect rents, This
budget change will account for property management services and expected rent until June 30, 2007. The
property management agreement was presented for City Council Approval May 15, 2007.
City Manager:
~~c_
Date: ~( <i I~')
Signature
As Approved at th~City Council Meeting on: Date:
Mayor:
Date:
Signature
Posted By:
D::!te:
Signature
Attachment 2