DATE: February 18, 2026
TO: Honorable Mayor and City Councilmembers
FROM: Public Works Department
TITLE: AMENDMENT 5 TO PROPERTY LEASE AGREEMENT WITH CROWN CASTLE GT COMPANY LLC FOR A TELECOMMUNICATIONS FACILITY AT THE HENIE HILLS RESERVOIR
RECOMMENDATION
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Staff recommends that the City Council approve Amendment 5 to the Property Lease Agreement with Crown Castle GT Company LLC, for the lease of City-owned property at Henie Hills Reservoir for a telecommunications facility, extending the term of the agreement for five years to February 28, 2031, with total revenue to the City in the amount of $396,424; and authorize the City Manager to execute the amendment upon receipt of all supporting documents.
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BACKGROUND AND ANALYSIS
On March 1, 1991 Crown Castle GT Company LLC (“Crown Castle”), originally entered into a Property Lease Agreement (“Agreement”) with the City of Oceanside (“City”), for use of a portion of real property at the Henie Hills Reservoir located at 2 Barnard Drive, (“Premises”) for a telecommunications facility. The original term of the Agreement expired on February 28, 1996. Amendment 1 to the Agreement (“Amendment 1”) extended the Agreement for ten years, expiring on February 28, 2016. Amendment 2 to the Agreement (“Amendment 2”) modified terms to allow for co-location, and updated the language for assignment and subletting. Amendment 3 to the Agreement, (“Amendment 3”) extended the term of the Agreement for five years, expiring on February 28, 2021. Amendment 4 to the Agreement, (“Amendment 4”) extended the term of the Agreement for five years, expiring on February 28, 2026. Crown Castle has requested to exercise its option to extend the Agreement for an additional five years to expire February 28, 2031.
The proposed fifth amendment (“Amendment 5”) extends the term of the Agreement an additional five years for the continued use of the Premises by Crown Castle as a telecommunications facility. The use of the Premises by Crown Castle does not interfere with the City’s use of the Henie Hills Reservoir and the City does not anticipate needing the Premises through the extended term of the Agreement. The proposed Amendment 5 would provide Crown Castle one additional five-year option to extend the term of the Agreement after the term expires. Amendment 5 also gives the City the option to request a business summary report pertaining to Crown Castle’s rent obligations from sublessees. This request shall be made in writing one time per calendar year by the City.
The continued use of the Premises by Crown Castle has been evaluated to ensure the City is receiving fair market value rent, and will provide continued revenue to the City.
Pursuant to the terms of the Agreement, the current rent will increase no less than five percent (5%) to $5,642, effective as of March 1, 2026. The rent shall be increased on an annual basis each March 1 of the term at a minimum of five percent (5%) over the previous monthly rent in effect, or by the Consumer Price Index, whichever is greater. In addition, the City is receiving a monthly revenue share of $371 generated by a percentage of revenue received from sublessees at the telecommunication facility. It is anticipated that the five-year term will generate a total combined minimum revenue of $396,424.
Crown Castle has met the terms of the lease throughout its entirety to date, and staff supports continuing the Agreement under the terms of Amendment 5.
FISCAL IMPACT
The Agreement requires an initial annual payment of $67,709, payable in installments of $5,642 a month. Thereafter, said amount will be increased, annually each March 1 at a minimum rate of 5% over the previous year. The current revenue generated from sublessees revenue shares are currently at a monthly rate of $371. This monthly rate may change based on the agreement Crown Castle has with the sublessees. The five-year term will generate a combined minimum total revenue of $396,424 and will be deposited into the City’s General Fund account number 1101.4351.
|
Description |
Total Revenue (Five-Year Term) |
Account # |
|
Amendment 5 |
$396,424 |
1101.4351 |
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: Candice Diaz, Property Agent
Reviewed by: Hamid Bahadori, Public Works Director
Submitted by: Jonathan Borrego, City Manager
ATTACHMENTS:
1. Staff Report
2. Amendment 5
3. Financial Backup