Lease of City-Owned Land on the
North Side of Steeles Avenue and
West of Old Kennedy Road, City of Markham
The Corporate Services Committee recommends the adoption of the following report (January 9, 1998) from the Commissioner of Corporate Services:
Purpose:
To lease the subject property to German Stars Motor Inc.
Funding Sources, Financial Implications and Impact Statement:
This lease will generate revenue of approximately $70,750.00 for the term of the lease.
Recommendation:
It is recommended, subject to such approvals as may be required under the City of Toronto Act, 1997, that:
(1) the City of Toronto enter into a lease agreement with German Stars Motor Inc., on the terms and conditions outlined in this report and in the form acceptable to the City of Toronto Solicitor; and
(2) the appropriate City of Toronto Officials be authorized and directed to take the necessary action to give effect thereto.
Council Reference/Background/History:
The subject property is a parcel of land, irregular in shape, containing approximately 929 square metres (10,000 square feet). It is situated at the north side of Steeles Avenue East and west of Old Kennedy Road and is currently vacant.
Comments and/or Discussion and/or Justification:
Upon request by Mrs. Odait Metyas of German Stars Motor Inc., 40 Cleethorpes Boulevard, M1S 3T3, agreement has been reached on the following terms and conditions:
(1) Leased Area: Approximately 929 square metres (10,000 square feet). The Landlord shall have the right to adjust the location of the leased area to accommodate the access, acting reasonably.
(2) Lease Term: Five (5) years commencing on the first day of the month following the execution of the lease, subject to termination by either party upon 6 months= written notice.
(3) Rent: $11,600.00 per annum, net, for the first two years and $15,850.00 per annum, net, for the remaining of the term, payable monthly in advance, plus all applicable taxes, including but not limited to GST, realty and business taxes, and any costs related to the leased area.
(4) Use: The Tenant agrees that:
(i) the leased area is not to be used for any purpose other than automobile sales, leasing and renting;
(ii) only currently licensed vehicles are to be stored on the leased area;
(iii) all storage of vehicles on site is to be temporary in nature and shall be in direct connection with the tenant=s own business activities and not that of others;
(iv) no vehicles used for carrying petroleum products or waste materials are to be stored on the leased area;
(v) no derelict vehicles are to be stored on the leased area;
(vi) no storage of tires; and
(vii) no automobile repairs of any kind will be permitted on the leased area.
(5) Leasehold Improvements:
The Tenant shall accept the leased area on an Aas is@ basis and the Tenant must satisfy itself, at its own expense, that the Tenant=s intended use complies with existing Zoning By-law, Building Code, Ontario Fire Code and all other rules and regulations. In the event the Tenant intends to perform any construction/improvement, detailed drawings and specifications must be submitted to the Commissioner of Transportation for written approvals and the Landlord shall not be responsible for the costs of such work. In the event of early termination, the Tenant agrees to waive any claim for any compensation and/or reimbursement for any of the improvement costs. In any event, the Tenant shall not commence any work prior to the execution of the lease.
(6) Access:
Access to and from the property is restricted to the existing access on Steeles Avenue East only, and no other access is permitted.
The Tenant acknowledges and agrees that the access shall be shared in common with other tenant(s) on the lot.
(7) The Tenant shall, at its sole expense, erect fences or barrier on the boundaries of the leased area, and shall not be permitted to use and/or occupy the adjoining land owned by the Landlord.
(8) The Tenant shall, at its sole expense, provide to the Landlord the following, prior to the commencement of any construction:
(a) An estimate of total cost of work;
(b) A revolving letter of credit, as may be required from time to time, in an amount or amounts sufficient to secure lienable contracts entered into from time to time for the supply of services and materials to the property, in a form and content satisfactory to the Commissioner of Corporate Services and/or the City of Toronto Solicitor. It is understood that the revolving letter of credit will be designed to provide the security as aforesaid throughout such phases of construction as may be reasonably agreed between the Commissioner of Corporate Services and the Tenant, provided, however, that subsequent phases of the renovation shall not be commenced until the Commissioner of Corporate Services is satisfied that the previous phase has been satisfactorily completed and all lienable contracts have been paid in full. In any event, an amount equal to 10 percent of the initial amount of the letter of credit of each respective phase shall be held back for not less than 45 days following the completion of each construction and/or renovation phase. The Landlord then shall examine title of the property and upon satisfying itself of no registered lien(s) relative to the renovation and/or construction shall release the held back funds forthwith; and
(c) Evidence of insurance coverage in an amount to be determined by the Commissioner of Finance, acting reasonably and in form and content satisfactory to the City of Toronto Solicitor.
(9) During the renovation period, the Tenant shall indemnify the Landlord from and against any and all manner of claims, demands, charges and other proceedings whatsoever brought against directly or indirectly or imposed on the Landlord or its property in respect of any loss, damage or injury (including fatal injury) to any person or property in connection with the renovation of the leased property in a form satisfactory to the Commissioner of Corporate Services and/or the City of Toronto Solicitor.
(10) The Tenant shall not enter into any lienable contracts for the supply of services and/or materials to the property without the consent of the Commissioner of Corporate Services.
(11) During the term of the lease or any renewal thereof, the Tenant, at its sole expense, shall be responsible for compliance with all current Municipal, Provincial and Federal laws, by-laws, rules, building code(s) and regulations and shall obtain all necessary permits and licenses that may be required for the use of the leased premises and shall save the Landlord harmless from any liability or cost suffered by the Tenant or the Landlord as a result of the Tenant=s failure to so comply. At the request of the Landlord, the Tenant shall be required to submit proof of such compliances. More specifically, the Tenant shall not commence work or operation without receipt of permits, licenses or approvals from proper authorities.
(12) The Tenant shall not be permitted to install, erect any fence(s), sign(s), structure(s) and/or fixture(s) on the leased area without prior written approval of the Commissioner of Transportation and/or Commissioner of Corporate Services.
(13) The Tenant shall not make any changes in surfacing, grading, landscaping to the leased area or remove tree(s) without the prior written approval of the Commissioner of Transportation and/or Commissioner of Corporate Services.
(14) The Tenant shall not be permitted to store or use any hazardous materials, or conduct any act which may cause soil contaminations.
(15) The Tenant shall protect all public works= services and/or utilities easement(s) that may encumber the property, and shall be liable for any damage to such by its action(s) or omission(s).
(16) The Tenant shall, at its expense, keep the leased area in a clean and well-ordered condition, and not to permit any rubbish, refuse, debris or other objectionable material to be stored, or to accumulate, thereon.
(17) The Tenant shall ensure that nothing is done or kept at or on the leased area which is or may be a nuisance, or which causes disturbance, damage to or interference with normal usage of any adjoining property.
(18) The Tenant shall, at its expense, keep the parking lot, sidewalks, common area, and areaways in, around and about the leased area free and clear of obstructions and free and clear at all times of snow and ice and in the case of areaways, closed and properly guarded.
(19) The Tenant shall, at its sole expense, obtain Liability Insurance of an amount not less than $2,000,000.00 with the City of Toronto shown as an additional insured and to contain Cross Liability and Waiver of Subrogation Clauses.
(20) The Tenant shall not install any equipment or carry on any operation at the leased area in such way as to increase the insurance risk.
(21) (i) The Tenant shall, at all times, indemnify and save harmless the Landlord from and against any and all manner of claims, demand, losses, costs, charges, actions and other proceedings whatsoever (including those under or in connection with the Worker=s Compensation Act or any successor legislation) made or brought against, suffered by or imposed on the Landlord or its property in respect of any loss, damage or injury (including fatal injury) to any person or property (including, without restriction, employees, agents and property of the Landlord or of the Tenant) directly or indirectly arising out of, resulting from or sustained as a result of the Tenant=s occupation or use of, or any operation in connection with the leased area or any fixtures or chattels thereon; and
(ii) The Tenant shall at all times indemnify and save harmless the Landlord from and against any and all claims, demands, losses, costs, charges, actions and other proceedings whatsoever under the Construction Lien Act, 1983, or any successor legislation in connection with any work done for the Tenant at or on the leased area, and shall promptly see to the removal from the registered title to the leased area, of every claim for lien and certificate of action having to do with such work.
(22) During the term of the lease, the Tenant shall keep the leased area in a neat and tidy condition and, at the termination of the lease or any renewal or extension thereof, the Tenant shall, at its sole expense, remove all fixture(s), equipment, structure(s) and debris and repair all damages caused by its occupation and use of the leased area. The Commissioner of Transportation, may, at its sole discretion, require the Tenant, at its expense, to restore the leased area to its original condition prior to the Tenant's occupancy.
(23) The Tenant acknowledges and agrees that the Landlord=s adjoining land is leased to other party(ies); and to comply with any future rules and regulations as set by the Landlord from time to time relating to the maintenance and the shared use of the access and right-of-way as determined by the Landlord, at its sole discretion.
(24) The Tenant shall be responsible, at its expense, to co-operate with the other tenant(s) on the lot to secure and restrict the access to the leased area and the adjoining land owned by the Landlord and the maintenance of the access and the mutual right-of-way.
(25) The Landlord, and any of its employees, agents and contractors shall have the right, on at least Twenty-four hours= advance notice to the Tenant, or in the case of emergency or pressing urgency, without advance notice provided that the Tenant is notified thereof as soon as may be convenient thereafter, to enter on the leased area for the purposes of maintenance, repair, or construction with or without all necessary or convenient gear and equipment as the Landlord=s Commissioner of Transportation and/or Commissioner of Corporate Services deems necessary, and the Tenant hereby authorizes such entry and acknowledges that the said Commissioner(s) shall be the sole judge of any emergency or pressing urgency as aforesaid. The Tenant shall ensure that once any notice of entry is given to the Tenant, the leased area is cleared of all persons and vehicles during the performance of the work therein referred to, other than as authorized by the Commissioner of Corporate Services or Transportation.
(26) The Tenant shall not sublet or assign without the written consent from the Landlord; such consent may not be unreasonably withheld.
(27) Upon execution of the lease, the Tenant shall pay to the Landlord the first month=s rent and a deposit of an amount equal to 3 months rent. Such deposit may be paid by certified cheque or Letter of Credit from a major bank in a form satisfactory to the City of Toronto Solicitor and shall bear no interest. The deposit is to be applied to costs incurred by the Landlord in the event of Tenant=s default, including but not limited to legal and administrative cost to collect rent in arrears, clean-up, repair and remediation of leased property.
(28) All documentation shall be in the Landlord=s standard form and notwithstanding any terms and conditions contained or not contained in this proposal, shall be in a form and content satisfactory to the City of Toronto Solicitor.
(29) The lease may be signed under a company name, provided at sole discretion of the Commissioner of Corporate Services, the authorized person shall personally guarantee the covenants of the lease, and such guaranty is to be in a form and content satisfactory to the City of Toronto Solicitor.
(30) The Landlord will not pay any real estate commissions associated with this transaction.
Conclusions:
In my opinion, these terms and conditions are fair and reasonable and I have been advised by the Transportation Department that it has no objection to the leasing of the subject property.
Contact Name and Telephone Number:
Mr. Tony Pittiglio, Manager of Property Services, Tel: 392-8155.
