HomeMy WebLinkAboutContract 59329CSC No. 59329
TERMINATION OF SUBLEASE
This Termination of Sublease (the "Termination") is entered into to be effective as of April 11,
2023 ("Effective Date") between City of Fort Worth ("Landlord") and Burns & McDonnell Engineering
Company, Inc. "Tenant" each individually referred to as a "party" and collectively referred to as the
"parties."
RECITALS
WHEREAS Landlord, as successor -in -interest to Hertz Fort Worth Energy Way LP, and Tenant, as
subtenant to Pier 1 Services Company ("Sublandlord"), are parties to that certain Sublease dated April 26,
2016, as amended and modified (collectively, the "Sublease"), regarding the lease of approximately
53,014 square feet of rentable space on the 16th and 171h floor of the Landlord's building located at 100
Energy Way, Fort Worth TX 76102 (the "Premises"); and
WHEREAS a copy of the Sublease is attached hereto as Exhibit "A" and incorporated herein for
all purposes; and
WHEREAS the Sublease provides for a term expiring on August 31, 2024; and
WHEREAS Landlord and Tenant agree that an early termination of the Sublease is in the best
interest of the parties and Landlord is willing to accept an early termination of the Sublease in exchange
for the consideration and provisions contained herein; and
WHEREAS the termination of the Sublease was approved by the Fort Worth City Council on
April 11, 2023 through Mayor and Council Communication No. 23-0279; and
WHEREAS Landlord and Tenant now wish to memorialize (i) the termination of the Sublease
and (ii) the settlement of all claims of Tenant against Landlord relative to the Sublease and Tenant's
occupancy of the Premises.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and for other
good and valuable consideration, the receipt of which is hereby acknowledged, Landlord and Tenant
hereby agree as follows:
1. Recitals. The foregoing recitals are hereby affirmed by the parties as true and
correct and each such recital is incorporated herein by this reference. Unless otherwise defined herein,
capitalized terms used in this Amendment shall have the meanings ascribed to such terms in the Sublease.
2. Termination of Sublease. Landlord and Tenant agree that the Expiration Date of the
Sublease shall be September 30, 2023, as contemplated by this Termination. The Sublease shall be
terminated as of the Expiration Date and Tenant agrees to surrender the Premises to Landlord by the
Expiration Date in accordance with the terms of the Sublease, except as modified herein.
3. Holdover. If Tenant holds over without the consent of Landlord: (a) the Base Rent
payable for the first month of holdover shall be the same as the Base Rent for the month immediately
Tennination of Sublease — 100 Energy Way OFFICIAL RECORD
Burns & McDonnell Engineering Company, Inc. CITY SECRETARY
Pagel of 5 FT. WORTH, TX
preceding the Expiration Date and the Base Rent for any additional holdover shall be 150% of the Base
Rent for the month immediately preceding the Expiration Date; (b) Tenant's right to possession shall
terminate on 30 days' notice from Landlord; and (c) all other terms and conditions of this Sublease shall
continue to apply. Nothing contained herein shall be construed as a consent by Landlord to any holding
over by Tenant.
4. Consideration. For and in consideration of the recitals set forth above, the early
termination of the Sublease, and other provisions contained herein, Tenant agrees to pay Landlord a total
of Six Hundred Thousand and 00/100 Dollars ($600,000.00) ("Termination Consideration"). The
Termination Consideration shall be delivered to Landlord by April 30, 2023.
5. Rent. Tenant shall remain obligated to pay all Rent (including Base Rent,
electricity and HVAC costs and charges, and operating expenses) due under the Sublease until and through
the Tenant's surrender of the Premises to Landlord in accordance with the terms of the Sublease, which
amounts shall be prorated or refunded as applicable.
6. Surrender and Release. Tenant's sole obligations upon surrender of the Premises to
Landlord shall be (i) to the complete the Move Out Checklist attached hereto as Exhibit "B" and (ii) to
deliver the Premises in broom clean condition to Landlord on the Expiration Date. Upon Tenant's
payment of the Termination Consideration and surrender of the Premises as set forth herein,
Landlord and Tenant hereby forever release one another from any and all claims, demands, losses,
damages, compensation, costs, rights, obligations, injuries or liabilities arising from or related to
the Sublease.
7. Governmental Powers. It is understood and agreed that by execution of this
Termination, Landlord does not waive or surrender any of its governmental powers or immunities.
8. Governing Law and Venue. This Termination will be construed in accordance
with the laws of the State of Texas. If any action, whether real or asserted, at law or in equity, is brought
pursuant to the Lease or this Termination, venue for such action will lie in state courts located in Tarrant
County, Texas or the United States District Court for the Northern District of Texas, Fort Worth Division.
9. Severability. If any provision of this Termination is held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be
affected or impaired.
10. Signature Authority. The person signing this Termination hereby warrants that
they have the legal authority to execute this Termination on behalf of the respective party, and that such
binding authority has been granted by proper order, resolution, ordinance or other authorization of the
entity. This Termination may be executed by any authorized representative of Tenant. Each party is fully
entitled to rely on these warranties and representations in entering into this Termination.
11. Electronic Signatures. This Termination may be executed by electronic signature,
which will be considered as an original signature for all purposes and have the same force and effect as
an original signature. For these purposes, "electronic signature" means electronically scanned and
Termination of Sublease — 100 Energy Way
Burns & McDonnell Engineering Company, Inc.
Page 2 of 5
transmitted versions (e.g. via pdf file or facsimile transmission) of an original signature, or
signatures electronically inserted via software such as Adobe Sign.
[signature page follows]
Termination of Sublease — 100 Energy Way
Burns & McDonnell Engineering Company, Inc.
Page 3 of 5
IN WITNESS WHEREOF, the parties hereto have executed this Amendment in multiples.
LANDLORD:
CITY OF FORT WORTH
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By: Dana Burghdoff (AI028, 20 :30 CDT)
Name: Dana Burghdoff
Title: Assistant City Manager
Date: Apr 28, 2023, 2023
APPROVAL RECOMMENDED:
CONTRACT COMPLIANCE MANAGER:
By signing I acknowledge that I am the person
responsible for the monitoring and administration
of this contract, including ensuring all performance
and reporting requirements.
By:
Name
Title:
Greg Wingate
Sr. Facility Planner, Property Management
Department
By: ste�ero6kee((Apr 27, 2023 11:10 CDT) APPROVED AS TO FORM AND LEGALITY:
Name: Steve Cooke
Title: Director, Property Management Department
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ATTEST: b0F FOR.*
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By: 0
Oaan nEXA?o�p
Name: Jannette S. Goodall
Title: City Secretary
TENANT:
By:
Name:
Title:
Matthew A. Murray
Assistant City Attorney
CONTRACT AUTHORIZATION:
M&C: 23-0279 (April 11, 2023)
Form 1295: N/A
BURNS CD N �M=
G COMPANY, INC.
By:
Name: '9w4a AA- Ab l (rnat1
Title: C'I�i ern i Simiyo _ O{'�e
Date:
Termination of Sublease — 100 Energy Way
Burns & McDonnell Engineering Company, Inc.
Page 4 of 5
OFFICIAL RECORD
CITY SECRETARY
FT. WORTH, TX
Exhibit B
MOVE -OUT CHECKLIST
Building Name: Future CitV Hall fka Pier 1 Imports Building
Tenant Name: Burns & McDonnell
Suite: 1600 & 1700; RSF: 53,014; Rent Stop Date: TBD, tentative_
Tenant Contact and Forwarding Address:
Attention:
Burns & McDonnell
Return Items
Keys -
Access Cards -
Door Codes —
Mutual Walk Through of Suite 1600 & 1700
Damages — Provide detailed explanation:
Sr. Facilities Manager & Date: Burns & McDonnell Representative & Date:
Termination of Sublease — 100 Energy Way
Burns & McDonnell Engineering Company, Inc.
Page 5 of 5
5/4/23, 8:09 AM
M&C Review
CITY COUNCIL AGENDA
Create New From This M&C
DATE: 4/11/2023 REFERENCE
NO..
CODE: G TYPE:
Official site of the City of Fort Worth, Texas
FoRTWORin
**M&C 23- LOG NAME: 21 BURNS & MCDONNELL
0279 EARLY TERMINATION 2023
CONSENT PUBLIC NO
HEARING:
SUBJECT: (CD 9 / Future CD 9) Authorize Early Termination of Sublease with Burns & McDonnell
Engineering Company, Inc. for Suites 1600 and 1700 in the Future City Hall Located at
100 Energy Way, Fort Worth, Texas 76102 in Exchange for a Payment from Burns &
McDonnell Engineering Company, Inc. in the Amount of $600,000.00
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize early termination of sublease with Burns & McDonnell Engineering Company, Inc.
for Suites 1600 and 1700 in the future City Hall building located at 100 Energy Way, Fort
Worth, Texas 76102; and
2. Accept a one-time payment of $600,000.00 from Burns & McDonnell Engineering Company,
Inc. as consideration for the early termination.
DISCUSSION:
The purpose of this Mayor and City Council Communication (M&C) is to authorize an amendment to
and early termination of the sublease (Sublease) with Burns & McDonnell Engineering Company, Inc.
(Burns & McDonnell) for Suites 1600 & 1700, consisting of the entirety of the 16th & 17th floors or
approximately 53,014 rentable square feet of space, in the future City Hall located at 100 Energy Way,
Fort Worth, Texas 76102. On December 15th, 2020, the City Council authorized the acquisition of the
building from Hertz Fort Worth Energy Way L.P. and accepted assignment of the building's existing
leases, including the Sublease with Burns & McDonnell (M&C 20-0910).
On January 25, 2022, City Council approved an amendment to the Sublease to (1) allow Burns &
McDonnell to use and occupy the remainder of the 16th floor and (2) revoke Burns & McDonnell's
option to extend the term of the Sublease, providing for an expiration date of August 31, 2024 (M&C
22-0072).
As amended, the total amount of rent due and payable to the City of Fort Worth (City) under the
Sublease is $3,945,272.98. Property Management staff has determined that an early termination of
the Sublease in exchange for a one-time payment of $600,000.00 would be in the best interests of the
City. If approved, the Sublease would be amended to provide for a termination date of September 30,
2023. Burns & McDonnell would continue to pay rent until the termination of the Sublease, amounting
to approximately $811,693.20. The Sublease would also be amended to provide that any holdover of
the Sublease after September 30, 2023 would be paid by Burns & McDonnell at a prorated amount of
150\% of the current Sublease rent.
An early termination of the Sublease will allow the City to more quickly program and utilize space on
the 16th and 17th floors. The City intends to use the revenue from the early termination payment of
$600,000 to offset future borrowing requirements related to improvements associated with the new
City Hall. Staff will return to Council with an M&C to appropriate the revenue at the time debt is issued
for this purpose.
The property is located in COUNCIL DISTRICT 9 / FUTURE COUNCIL DISTRICT 9.
FISCAL INFORMATION/CERTIFICATION:
apps.cfwnet.org/council_packet/mc_review.asp?I D=30906&counciIdate=4/11 /2023 1 /2
5/4/23, 8:09 AM M&C Review
The Director of Finance certifies that upon approval of the above recommendations and authorization
of the amendment funds will be deposited into the General Capital Projects Fund. The Property
Management Department (and Financial Management Services) is responsible for the collection and
deposit of funds due to the City.
TO
Fund Department Account Project Program Act Budget Reference # Amount
ID I ID Year (Chartfield 2)
FROM
Fund Department Account Project Program Activity Budget Reference # Amount
ID I I ID 1 1 Year (Chartfield 2)
Submitted for City Manager's Office by_ Dana Burghdoff (8018)
Originating Department Head: Steve Cooke (5134)
Additional Information Contact: Gregory Wingate (0496)
ATTACHMENTS
21BURNS & McDONNELL EARLY TERMINATION FID TABLE BLANK 03.21.23.xlsx (CFW Internal)
Form 1295 Certificate 101019005 City of Fort Worth 2023.pdf (CFW Internal)
apps. cfwnet.org/counci I_packet/mc_review.asp? I D=30906&cou nciIdate=4/11 /2023 2/2