DATE: June 18, 2025
TO: President and Directors of the Harbor District Board
FROM: Public Works Department
TITLE: AMENDMENT 5 TO THE PERCENTAGE PROPERTY 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 5 to the Percentage Property Lease Agreement between the Oceanside Small Craft Harbor District and Bill Middleton & Sean D. White, dba Breakwater Yacht Sales, for the premises located at 1351 Harbor Drive North, Suite B, for reduction of the leased premises; and authorize the Administrative Officer to execute the amendment upon the receipt of all supporting documents.
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BACKGROUND AND ANALYSIS
On December 2, 2015, the Oceanside Small Craft Harbor District (“District”) entered into a Percentage Property Lease Agreement (“Agreement”) with Mr. Bill Middleton and Sean D. White, doing business as Bill Middleton Yachts (“Lessee”) for the office space located at 1351 Harbor Drive North, Suite B and adjacent concrete slab (“Premises”). The District subsequently approved four renewal extensions via Amendment 1 dated November 5, 2017, Amendment 2 dated December 18, 2019, Amendment 3 dated December 1, 2021 and Amendment 4 dated October 4, 2023.
Lessee provides yacht brokerage services to the Harbor and at this time no longer requires use of adjacent 1,185 square foot concrete pad. Therefore, Lessee has requested the District to remove the concrete pad from Agreement and continue ongoing operations from leased building space, with a revised total lease area of 462 square feet. Lessee will vacate the concrete pad by May 31, 2025 and the District intends to utilize the 1,185 square foot concrete pad for other visitor serving purposes such as a viewing area with benches for the public with an unobstructed view of Harbor.
The existing minimum annual rent is $47,196 and shall be reduced to $15,800 per year effective June 1, 2025. The minimum annual rent shall be increased each December 1 by a minimum of 5 percent.
FISCAL IMPACT
|
Description |
Monthly Amount |
Annual Minimum Revenue Amount |
Revenue Account |
|
Breakwater Yacht Sales Minimum Rent Revenue |
$1,317 |
$15,800 |
Harbor Leases 1751.4496 |
Amendment 5 minimum annual rent of $15,800 will be effective from June 1, 2025, and will be deposited to Harbor account 1751.4496. FY 2025-26 annual budget will be reduced by $31,396 due to the downsizing of leased premises. The minimum annual rent is adjusted annually based on the semi-annual Consumer Price Index or 5 percent, whichever is greater.
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 5
3. Exhibit A-1