V.4. Amendment to Lease Agreement – The Luther Company; ElverumNovember 15, 2018 Council Report 2018-123
AMENDMENT TO LEASE AGREEMENT – THE LUTHER COMPANY
Proposed Action
Staff recommends adoption of the following motion: Move to approve Amendment One to
Lease between The Luther Company, LLLP, and the City of Hopkins.
With this motion, the lease amendment will be executed.
Overview
The City of Hopkins owns a property on Excelsior Boulevard, immediately east of 5th Avenue
South, and currently leases it to The Luther Company. Luther pays the City $400 per month
for use of the site for employee and miscellaneous parking for Hopkins Honda.
During the construction of the Green Line Extension, the site will be impacted through
construction of new curb and gutter, new sidewalk, and new driveway apron. The Metropolitan
Council, responsible for construction of the Green Line Extension, has requested language be
added to the lease agreement that specifically calls out that the property is subject to a
temporary construction easement.
The contractor must maintain access to the parcel at all times. This means the driveway
access could move to allow for the new work to be constructed. Luther Company is aware of
the proposed amendment and has indicated they are accepting of the language.
Primary Issues to Consider
This action does not change the amount Luther Companies pays the City of Hopkins, or any
other substantive terms. It is being recommended in order to limit financial exposure of the
Metropolitan Council for work related to the Green Line Extension.
Supporting Information
• Resolution 2018-087
• Lease between the City of Hopkins and The Luther Company
____________________________
Kersten Elverum
Director of Planning & Development
Financial Impact: $0 Budgeted: Y/N _N___ Source: Related Documents (CIP, ERP,
etc.):
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CITY OF HOPKINS, MINNESOTA
RESOLUTION NO. 2018-087
RESOLUTION AUTHORIZING THE AMENDMENT OF LEASE TO
ACCOMMODATE TEMPORARY EASEMENT
WHEREAS, the City of Hopkins, Minnesota (“City”), entered into a lease agreement with
The Luther Company, LLLP (“Tenant”), dated February 14, 2008 (the “Lease”), for real property
legally described as: that part of Lot 31, Auditor’s Subdivision Number 242, Hennepin County,
Minnesota, lying east of the easterly line of 5th Avenue South in the City of Hopkins (the
“Premises”); and
WHEREAS, pursuant to a separate temporary easement between the City and the
Metropolitan Council for the construction of the Southwest LRT Project (“Easement”), the City
granted certain temporary easement rights over the Premises; and
WHEREAS, the Metropolitan Council has requested that the City amend the Lease to
insure and provide that the Lease is subject to the Easement; and
WHEREAS, the City desires to accommodate the Easement and subject the Lease to its
terms by entering into an amendment to the Lease between the City and Tenant (the “Lease
Amendment”), according to the terms of which Tenant will acknowledge and agree that its use of
the Premises is specifically subject to the Easement, and which amendment is attached hereto as
Exhibit A;
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Hopkins,
Minnesota, that the recitals and the exhibit set forth in and attached to this Resolution are incorporated
into and made a part of this Resolution.
NOW, THEREFORE, BE IT FURTHER RESOLVED, that the City Council of the
City of Hopkins, Minnesota, hereby authorizes the approval of all documents and necessary actions
relative to the Lease Amendment.
NOW, THEREFORE, BE IT FINALLY RESOLVED, by the City Council of the City
of Hopkins, Minnesota, that the Mayor, City staff, City attorney and City consultants are hereby
authorized and directed to take any and all additional steps and actions necessary or convenient in
order to accomplish the intent of this Resolution.
Approved this ___ day of _______, 2018, by the City Council of the City of Hopkins, Minnesota.
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CITY OF HOPKINS, MINNESOTA
Attest:
Molly Cummings, Mayor
Amy Domeier, City Clerk
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EXHIBIT A
Form of Lease Amendment
FIRST AMENDMENT TO LEASE AGREEMENT
This First Amendment to Lease Agreement (this “Amendment”) is made effective as of the latter
signature date hereof (the “Effective Date”) by and between the City of Hopkins, a Municipal
corporation under the laws of the State of Minnesota (“Landlord”) and Luther Company,
LLLP, a Minnesota limited liability limited partnership (“Tenant”) (Landlord and Tenant being
collectively referred to herein as the “Parties”).
RECITALS
WHEREAS, Landlord owns the real property described on Exhibit A attached hereto and by
this reference made a part hereof (the “Premises”); and
WHEREAS, Landlord and Tenant entered into that certain Lease Agreement dated February 14,
2008 (as the same may have been amended from time to time, collectively, the “Lease”),
pursuant to which the Tenant leases the Premises; and
WHEREAS, Landlord and Tenant desire to amend the terms of the Lease as expressly provided
herein.
NOW THEREFORE, in consideration of the foregoing recitals and the mutual covenants set
forth herein and other good and valuable consideration, the receipt, adequacy, and sufficiency of
which are hereby acknowledged, the Parties hereby agree as follows:
1. Consent and Joinder. Tenant acknowledges and agrees that its use of the Premises is
specifically subject to that certain temporary construction easement entered into by and
between the Landlord and the Metropolitan Council for the construction of the Southwest
LRT project.
2. Landlord and Tenant Acknowledgments. Except as modified herein, the Lease and all
provisions contained therein remain in full force and effect and are hereby ratified and
affirmed. The parties hereby agree that no defaults exist under the Lease.
3. Counterparts. This Amendment may be executed in several counterparts, each of which
when so executed and delivered, shall be deemed an original and all of which, when taken
together, shall constitute one and the same instrument, even though all Parties are not
signatories to the original or the same counterpart. Furthermore, the Parties may execute and
deliver this Amendment by electronic means such as .pdf or similar format. Each of the
Parties agrees that the delivery of the Amendment by electronic means will have the same
force and effect as delivery of original signatures and that each of the Parties may use such
electronic signatures as evidence of the execution and delivery of the Amendment by all
Parties to the same extent as an original signature.
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LANDLORD:
City of Hopkins, a Minnesota municipal
corporation
Signature: ____________________________
Print Name: Molly Cummings
Title: Mayor____________
Date: _________________
Signature: ____________________________
Print Name: Michael Mornson
Title: City Manager____________
Date: _________________
[SIGNATURES CONTINUE ON FOLLOWING PAGE]
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TENANT:
The Luther Company, LLLP
a Minnesota limited liability limited partnership
Signature: _____________________________
Print Name: ____________________________
Title: _________________________________
Date: _________________________________
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EXHIBIT A to Lease Amendment
Legal Description
That part of Lot 31, Auditor’s Subdivision Number 242, lying east of the easterly line of 5th
Avenue South in the City of Hopkins, County of Hennepin, State of Minnesota.
16.
LEASE
Date: February 14, 2008
This Lease ("Lease") is entered into by the City of Hopkins, Minnesota, a Municipal Corporation
under the laws of the State of Minnesota ("Landlord"), and The Luther Company, LLLP, a
Minnesota Limited Liability Limited Partnership ("Tenant"), for real property located at:
That part of Lot 31, Auditor's Subdivision Number 242 lying east of the easterly
line of 5th Avenue South in the City of Hopkins, County of Hennepin
Premises"), as of the date written above.
TERMS
1. DURATION. This Lease is a month to month lease, with a starting date of possession of:
March 1. 2008 , and an Ending Date of possession 60 days after receipt of written notice by
either party expressing its intent to terminate the Lease ("Lease Term").
2. RENT. Tenant agrees to pay $400.00 on or before the first of each month during the Lease
Term as rent. Tenant shall pay the Rent at 1010 Fist Street South, Hopkins, Minnesota, 55343,
attention City Planner, or other reasonable place requested by Landlord. Rent is "paid" when
Landlord receives it, not when mailed or sent by Tenant.
3. TENANT PAYS FOR DAMAGE. Tenant shall pay for all loss, cost, or damage caused by
the negligent or intentional conduct of Tenant, person under Tenant's direction or control, or
invitee of Tenant.
4. LANDLORD'S NON -WAIVER. Landlord's failure or delay in demanding payments does
not constitute a waiver. Landlord's failure to object to any breach of lease shall,,,not constitute a
waiver of Landlord's right to object to any future breach of lease.
5. ATTORNEY'S FEES. In the event that Landlord prevails in any lawsuit to enforce the
terms of this lease, Tenant shall pay Landlords' reasonable attorneys' fees and costs. In the
event that Tenant prevails in any lawsuit to enforce the terms of this Lease, Landlord shall pay
Tenant's reasonable attorneys' fees and costs.
6. LANDLORD'S PROMISES. Landlord makes no warranties, express or implied, of fitness
of the Premises for a particular purpose, or other promises regarding the suitability of the
Premises for Tenant's intended use thereof.
7. TENANT'S PROMISES.
A. Tenant shall not allow damage to the Premises
B. Tenant shall make no alterations, additions or improvements without Landlord's
written consent.
C. Tenant shall keep the Premises clean and tidy.
D. Tenant shall not unreasonably disturb the peace and quiet of others.
E. Tenant shall not use the Premises in any way that is unlawful, illegal, or dangerous.
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8. RESTRICTIONS. Tenant agrees that the property shall be used only for the storage of new
motor vehicles. Tenant expressly agrees' that it will not use the premises for the sale of motor
vehicles. Tenant agrees that "used," "pre -owned," or other similar vehicles shall not be stored at
the Premises. Tenant agrees that no advertising or similar signage shall be placed on the
Premises. All use by Tenant shall comply with all applicable Federal, State, and local laws,
including, but not limited to, licensing and insurance. A breach of this covenant constitutes a
material breach of this Lease.
9. LANDLORD'S RIGHT TO ENTER. Landlord may enter the Premises for any reasonable
business purpose.
10. DAMAGE OR INJURY TO TENANT OR TENANT'S PROPERTY/ INSURANCE.
Tenant agrees to indemnify, defend and hold Landlord and its officers and employees harmless
from and against any claim, loss or expense arising out of injury, death or property loss or
damage occurring at the Premises, except only to the extent caused by the negligent act or
intentional misconduct of Landlord or its partners, officers or employees or property manager.
Tenant shall carry general liability insurance in an amount of at least $1,000,000.00 providing
coverage for all liabilities arising from Tenant's use of the Premises. Tenant shall name
Landlord as additional insured on its policy and provide proof of insurance to Landlord before
the starting date of possession. By requiring Tenant to carry insurance, Landlord does not intend
to waive, and does not waive, any statutory or common law immunities or tort claim limits.
11. NOTICE OR DANGEROUS CONDITIONS. Tenant shall promptly notify Landlord of
any conditions that might cause damage to the Premises. The notice may be oral or in writing.
12. SUBLETTING. Tenant shall not sublet part or all of the Premises without Landlord's
written consent. Tenant shall not assign this Lease without Landlord's written consent. Any
assignment or sublet of the Premises without Landlord's written consent shall be null and void.
13. MOVING OUT OR HOLDING OVER. Tenant must move out not later than 11:59 p.m.
on the Ending Date.
14. PREMISES DESTROYED, UNINHABITABLE OR UNFIT FOR OCCUPANCY.
A. If the Premises is destroyed or becomes totally unusable through no fault or neglect of
Tenant or a person under Tenant's direction or control, either Landlord or Tenant may
end this Lease. To end the Lease, Tenant or Landlord shall give prompt written notice to
the other. Rent shall be prorated as of the date the Premises became unfit for occupancy.
B. If the Premises is destroyed or becomes totally unusable or completely unfit for
occupancy through the fault or neglect of Tenant or a person under Tenant's direction or
control, Landlord may end this Lease. Landlord shall give prompt written notice to
Tenant.
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15. BREACH OF LEASE [RE-ENTRY CLAUSE]. If Tenant materially breaches this Lease,
Landlord may do these things:
A. Demand in writing that Tenant immediately give up possession of the Premises. If
Tenant does not give up possession, Landlord may bring an eviction action.
B. Demand in writing that Tenant give up possession of the Premises to Landlord at a
certain date in the future. If Tenant does not give up possession on that date, Landlord
may bring an eviction action. Landlord may accept rent for the period up to the date
possession is to be transferred without giving up Landlord's right to evict.
C. Bring an eviction action immediately.
16. SUBORDINATION. This Lease is subordinate to any mortgage against the Premises.
Tenant shall sign Subordination, Non -Disturbance, and Attornment agreements or other
documents reasonably requested by Landlord, Landlord's lender, or potential purchaser of the
Premises. Tenant appoints Landlord as attorney-in-fact to sign such documents for any
mortgagee.
17. EXERCISE OF RIGHTS AND REMEDIES. Landlord may use any or all of its legal
rights and remedies. The use of one or more rights or remedies is not an election of remedies.
18. SUBROGATION. Tenant has no right of subrogation against the Landlord for loss or
damage covered by insurance.
19. TERMS. Where appropriate, singular terms include the plural and plural terms include the
singular.
20. MISREPRESENTATION. Any materially false statement made by Tenant to Landlord
that induces the signing of this Lease is a breach of this Lease.
21. NOTICES. All notices or other communications required to be given under°this Lease shall
be made in writing and via first class U.S. Mail to the addresses listed below. Notice is effective
when mailed.
To Landlord:
City Planner
1010 1st St. So.
Hopkins, MN 55343
or such other address as designated in writing.
To Tenant:
The Luther Company, LLLP
Attn: Director of Real Estate and Development
3701 Alabama Ave. So.
St. Louis Park, MN 55416
or such other address as designated in writing.
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22. ENVIRONMENTAL INDEMNITY/ HAZARDOUS MATERIALS. Tenant shall not
install, use, generate, store or dispose of in or about the Premises any hazardous substance, toxic
chemical, pollutant or other material regulated by the Comprehensive Environmental Response,
Compensation and Liability Act of 1985 of the Minnesota Environmental Response and Liability
Act or any similar law or regulation, including without limitation any material containing
asbestos, PCB, CFC or HCFC (collectively "Hazardous Materials") without Landlord's written
approval of each Hazardous Material. Landlord shall not unreasonably withhold its approval of
use by Tenant of immaterial quantities of Hazardous Materials customarily used in automobile
storage operations so long as Tenant uses such Hazardous Materials in accordance with all
applicable laws. Upon expiration or termination of this Lease Tenant shall remove all Hazardous
Materials installed, used, stored or disposed of in the Premises by Tenant. Tenant shall
indemnify, defend and hold Landlord harmless from and against any claim, damage or expense
arising out of Tenant's installation, use, generation, storage, or disposal of any Hazardous
Materials, regardless of whether Landlord has approved the activity.
Landlord and Tenant agree to the terms of this Lease
THE CITY OF HOPKINS, MINNESOTA
Eu e well, Nfayor Date
Richard Getschow, Date
City Manager
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Date
Its: W