December 2, 2003
SUBJECT: Approval of Lease of Space at 420 South Pastoria Avenue for Department of Employment Development from the State of California
REPORT IN BRIEF
City Council is requested to approve rental of office space at 420 South Pastoria Avenue in Sunnyvale for a portion of the City's Department of Employment Development (DED). The proposed lease is with the State of California, and is for approximately 6,597 square feet of office. The lease term is from January 1, 2004 thru June 30, 2006. The cost of the lease is $1.97 per square foot or $12,996.09 per month, for a total of $389,882.70 for the 30-month lease.
It is recommended that City Council approve the lease of office space from the State of California at 420 South Pastoria Avenue, and authorize the City Manager or his designee to execute the lease agreements.
BACKGROUND
In 1999, NOVA initiated a lease with the State of California for space at 420 South Pastoria. The State’s Employment Development Department had unused space, due to its move to telephone-based filing of unemployment claims. DED moved the CONNECT! Job-Seeker Services Center to this facility, evolving a true one-stop environment that is targeted to serve job-seeker’s needs.
EXISTING POLICY
The proposed activities are consistent with the City of Sunnyvale’s Socio-Economic Goal 5.1F, to provide job training and employment services, within constraints of operative Federal regulations and available Federal funding to address the locally-determined employment and training needs of economically disadvantaged residents and others with special needs.
DISCUSSION
NOVA and EDD both desired to continue their lease relationships beyond the end date of the original lease. Using holdover clauses in the previous lease, NOVA continued to pay EDD, while lease negotiations commenced. NOVA requested clarification of elements of the proposed lease rate for the space it occupies at 420 S. Pastoria. Recently, agreement was reached on the rate, and the State agreed to implement the new rate effective January 1, 2004.
The proposed lease for the NOVA space at EDD is for 30 months, beginning on January 1, 2004 and ending on June 30, 2006. The lease is for approximately 6,597 square feet of office space at $1.97 per square foot. Total cost of the lease is $389,882.70 over 30 months, which amounts to $12,996.09 per month. The rental amount includes maintenance and utilities associated with the site.
Fiscal Impact
Sufficient funds exist in NOVA’s grants to pay this cost. The lease includes a clause, which allows NOVA to terminate with 60 days notice.
PUBLIC CONTACT
1. Posting of Council Agenda.
2. Copies of this report are available to the public upon request, and are also available in the Sunnyvale Public Library and on the City of Sunnyvale website.
ALTERNATIVES
1. Approve the lease and sublease as presented.
2. Not approve the lease and have staff identify other facility options.
RECOMMENDATION
Staff recommends that City Council approve the lease of office space from the State of California at 420 S. Pastoria Avenue, and authorize the City Manager or his designee to execute the lease agreements.
Prepared by:
Stephen Quick
Manager, Business Operations
Approved by:
Michael J. Curran, Director
Department of Employment Development
Approved by:
Robert S. LaSala
City Manager
Attachments:
Lease Agreements