DATE: November 5, 2025
TO: President and Directors of the Harbor District Board
FROM: Public Works Department
TITLE: AMENDMENT 6 TO THE PERCENTAGE LEASE AGREEMENT WITH BILL MIDDLETON & SEAN D. WHITE, DBA BREAKWATER YACHT SALES
RECOMMENDATION
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Staff recommends that the Harbor District Board of Directors approve Amendment 6 to the Percentage Lease Agreement between the Oceanside Harbor District and Bill Middleton & Sean D. White, dba Breakwater Yacht Sales, for the premises at 1351 Harbor Drive North, Suite B, extending the term of the agreement from December 1, 2025, through November 30, 2027, for a two-year minimum total revenue of $34,010; and authorize the City Manager to execute the amendment upon receipt of all supporting documents.
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BACKGROUND AND ANALYSIS
The Oceanside Harbor District (“District”) entered into a Percentage Lease Agreement dated December 2, 2015 (“Agreement”) with Bill Middleton, doing business as Bill Middleton Yachts (“Lessee”), and subsequently approved five renewal extensions via Amendment 1 dated November 5, 2017, Amendment 2 dated December 18, 2019, Amendment 3 dated December 1, 2021, Amendment 4 dated October 4, 2023 and Amendment 5 dated June 18, 2025 for the office space located at 1351 Harbor Drive North, Suite B (“Premises”). The Agreement provides that Lessee may request an extension of the term for an additional two years at the District’s calculated percentage lease payment rate. Lessee has requested an extension of the term for an additional two years to continue ongoing yacht brokerage operations.
Amendment 6 to the Percentage Lease Agreement (“Amendment”) extends the term of the Agreement for two years, commencing December 1, 2025 and terminating November 30, 2027, and provides for one additional two-year renewal option. The minimum rent is adjusted annually based on the semi-annual Consumer Price Index or 5 percent, whichever is greater.
FISCAL IMPACT
|
Description |
1st Year Annual Amount |
2nd Year Minimum Revenue Amount |
Revenue Account |
|
Breakwater Yacht Sales Minimum Rent Revenue |
$16,590 |
$17,420 |
Harbor Leases 1751.4496 |
The Amendment will increase the minimum annual rent from $15,800 to $16,590 for the 1st year and $17,420 for the 2nd year, and will be deposited to Harbor account 1751.4496. Total minimum rent received over the previous two years totaled $90,780, which is an average of $45,390 per year. Lessee has downsized premises this year in order to reduce rent costs; therefore, in future years we expect to receive lower annual revenues. (No percentage rent was received over previous two years).
COMMISSION OR COMMITTEE REPORT
Does not apply.
CITY ATTORNEY’S ANALYSIS
The referenced documents have been reviewed by the City Attorney and approved as to form.
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Prepared by: Julie Cook, Property Agent II
Reviewed by: Hamid Bahadori, Public Works Director
Submitted by: Jonathan Borrego, City Manager
ATTACHMENTS:
1. Staff Report
2. Amendment 6
3. Lease Calculation