Broken Arrow City Council
Meeting of: 05-21-2019
Title:
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Consideration, discussion and possible ratification of a Lease Agreement between the City of Broken Arrow and Big Sky 40 Corporation for the lease by Big Sky 40 of real property located at 7500 Old Highway 51, Broken Arrow
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Background:
In order to acquire land located at 7500 Old Highway 51which is necessary to complete the 23rd Street Improvements between Houston and Kenosha Streets, the City filed a condemnation action against CWP, Inc., the landowner. In that action, the City has tendered payment to the court in the amount set in the commissioner's report; thus, the land is now City property. Big Sky 40 Corporation (the "tenant") conducts business as a restaurant and bar, called Scooters South 40, on the property. The tenant is relocating the bar business, but needs additional time to complete the relocation. A lease agreement with the tenant was necessary in order to, among other things, ensure the property is properly insured and that the tenant will indemnify the City for liabilities the City may incur as a result of the tenant's use of the property. Thus, the Lease Agreement attached hereto was executed on May 7, 2019, and became effective on that date.
The City will not begin construction on the subject property before the end of the year. The Lease Agreement is for a term ending July 31, 2019. Market rental rate for the subject property is approximately $1300/month. The lease agreement provides for rental payments of $1200/month, with a reduction of $300 per month in the event the tenant loses income due to the removal from the premises of a pool table and juke box owned by a third party. In addition, the Lease Agreement requires the tenant to ensure that all personal property belonging to third parties is removed before the end of the tenancy (July 31, 2019). It is to the benefit of the City that all personal property belonging to the tenant and/or any other party be removed...
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