HomeMy WebLinkAboutContract 28549 CITY SECRETARY
04-18 03P03 : 19 RCVD CONTRACT NO.
AMENDMENT NO. l TO
CITY SECRETARY CONTRACT NO. 23685
FORT WORTH ALLIANCE AIRPORT
FBO GROUND LEASE AGREEMENT BETWEEN
CITY OF FORT WORTH ANDFBO PARTNERS,LTD. M
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This AMENDMENT NO. 1 O CITY SECRETARY CONTRACT N 23685, Q
("Amendment") is entered into by and etween the CITY OF FORT WORTH, TE S (the
"City"), a home rule municipal corpora 'on organized under the laws of the State of xas and
acting by and through Marc Ott, its duly authorized Assistant City Manager, d FBO
PARTNERS, LTD. ("Lessee"), a Texa limited partnership acting by and through M. Thomas
Mason, Vice President of Hillwood sn, a Texas by its
general partner Hillwood Opgr g,L.P., a Texas limited partnership, general partner of Lessee.
r-Yi I ia,,L-man a�evmev,-h
The following introductory provisions are true and correct and form the basis of this
Amendment.
A. On or about October 14, 1997, the City and Lessee entered into City Secretary
Contract No. 23685 (the "FBO Ground Lease"), a lease of real property at Fort Worth
Alliance Airport, as more specifically defined and depicted in the FBO Ground Lease.
B. The term of the FBO Ground Lease is thirty (30) years. Lessee wishes to extend
the term by an additional ten (10) years. Article X1V, Section 17 of the City's Minimum
Standards for Fixed Base Operators and Other Airport Tenants, a public document
adopted by the Fort Worth City Council on June 16, 1992, limits the term of any lease of
property on a City-owned airport to a maximum of thirty (30) years, with an option or
options to renew the lease for up to ten(10) additional years. Therefore, Lessee's request
can only be achieved by amending the Lease to grant Lessee an option to renew the Lease
for a ten (10) year term following expiration of the initial thirty (30) year term of the
Lease.
NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the City and Lessee agree as follows:
1. Article 1 (Term; No Cross Default) of the Lease is hereby amended by deleting Section
1.1 in its entirety and replacing it with the following:
1.1. The term of this FBO Ground Lease shall commence on September 6,
1996 (which is the date on which the City issued a certificate of
occupancy for the FBO Facility and is the "Effective Date" as used in this
FBO Ground Lease) and shall expire on September 27, 2025; unless
sooner terminated in accordance with the provisions hereof ("Initial
Term"). NCNB
CITY *11111EAPY
Amendment No. 1 to City Secretary Contract No.23685
Page 1
1.1.1 If Lessee performs and abides by all provisions and conditions of this
lease, then upon expiration of the Initial Tenn Lessee will have an option
to renew this FBO Ground Lease for an additional term of ten (10) years
("Renewal Term"). Lessee may exercise this option by providing written
notice of its intent to renew this FBO Ground Lease for the Renewal Term
not less than one (1) year prior to the expiration of the Initial Term. If
Lessee exercises its option to renew this FBO Ground Lease for the
Renewal Term, all terms and conditions of this FBO Ground Lease shall
continue in full force and effect during the Renewal Term.
1.1.2. Not more than three (3) years prior to expiration of the Renewal Tenn,
Lessee may notify the City in writing of a desire to renew this FBO
Ground Lease for an additional ten (10) year term (the "Subsequent
Renewal Request"). The City, in the City's sole discretion, may(i) grant
the Renewal Request, either by entering into a new lease or, if allowed by
then-current laws and/or City regulations, by amending this FBO Ground
Lease, or (ii) deny the Renewal Request, provided that the basis for such
denial is not unreasonable under the circumstances.
2. Unless otherwise specifically indicated, references in the FBO Ground Lease to the
"term" of the FBO Ground Lease shall, without limitation, include the Initial Term and the
Renewal Term.
3. All terms in this Amendment that are capitalized but not defined shall have the meanings
assigned to them in the Lease.
4. This Amendment contains the final written expression of the City and Lessee with
respect to the subject matter hereof. This Amendment shall be effective upon execution by both
the City and Lessee and may be executed in multiples.
EXECUTED as of the -dayof 2003.
J
CITY OF FORT WORTH: ATTEST:
By: By.
Marc Ott Gloria Pe 1son
Assistant Manager City Secretary
!1 If:I ilk"It I R,E Cr,00 R D Amendment No. 1 to City Secretary Contract No.23685 IR ^11I.NJOHM, HE.
Page 2
APPROVED AS TO FORM AND LEGALITY:
By: � ----
Peter Vaky
Assistant City Attorney
M&C No. C-18972 02-19-02
FBO PARTNERS,
LTD.:
By: Millwood Gpeg,L.P.,
a Texas limited partnership,
its sole general partner
A 1 i anc c. Uj L-LC.
By:HillwoodII n,
a Texas coTer-atien I ►v,,%4--ec I t abi I 14-1,-
and its sole general partner:
By: M �
M. Thomas Mason
Vice President
Amendment No. 1 to City Secretary Contract No.23685 am
Page 3
STATE OF TEXAS §
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on
this day personally appeared Marc Ott, known to me to be the person whose name is subscribed to
the foregoing instrument, and acknowledged to me that the same was the act of the City of Fort
Worth and that he executed the same as the act of the City of Fort Worth for the purposes and
consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this j3 day
12003.
f116.1 1 IE 6�iYdE
Notary Public,State of j
My Commission Expi Notary Public in and for the State of Texas
T
July 26,2003
STATE OF TEXAS §
COUNTY OF DALLAS
\��`�k ��I I ta�rce. M�cv�c�Gterv�er�i,`iL
HiIVavice C P LC,C.
This instrument d==t=n,e me on 74 ti 2003, by M. Thomas
Mason of Hillwood a Texas on behalf of said
co,,, e(\ cnipo�, in its capacity as general partner of Hillwood , L.P., a Texas limited
partnership, on behalf of said limited partnership, in its capacity as general partner of FBO
Partners,Ltd., a Texas limited partnership, on behalf of said limited partnership.
ti. /4 P7eC6
Notary Public, St' e of Texas
ROTARY PUBLIC STATE OF TEXAS
% g COMMISSION EXPIRES:
of• DECEMBER 16,2004
Amendment No. 1 to City Secretary Contract No.23685
City of Fort Worth, Texas
tmagor and councit Communication
DATE REFERENCE NUMBER LOG NAME PAGE
2/19/02 C_18972 55EXTENSION 1 of 2
SUBJECT AMENDMENT OF CITY SECRETARY CONTRACT NO. 20060, AGREEMENT WITH
ALLIANCE AIR MANAGEMENT, LTD. FOR THE MANAGEMENT, OPERATION, AND
MAINTENANCE OF THE FORT WORTH ALLIANCE AIRPORT AND EXTENSION OF
TERMS OF RELATED FORT WORTH ALLIANCE AIRPORT LEASES
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager to amend City Secretary Contract- No. 20060, a Management
Agreement with Alliance Air Management, Ltd. for the management, operation, and maintenance of
the Fort Worth Alliance Airport extending the term and revising the compensation; and
2. Authorize an amendment to City Secretary Contract No. 20061, a Lease Agreement with Alliance
Air Services, Inc. extending the term; and
3. Authorize an amendment to City Secretary Contract No. 23512, a Ground Lease for Parcels 2 and 5
at Fort Worth Alliance Airport extending the term; and
4. Authorize an amendment to City Secretary Contract No. 23685, a Ground Lease for Parcel 3 at Fort
Worth Alliance Airport extending the term.
DISCUSSION:
On December 15, 1993 (City Secretary Contract No. 20060), a twenty-year Management Agreement
was executed with Alliance Air Management, Ltd. (Contractor) for the management, operation, and
maintenance of the Fort Worth Alliance Airport. On the same date (City Secretary Contract No. 20061),
a Lease Agreement with Alliance Air Services, Inc. was executed for certain parcels of property on the
eastside of Fort Worth Alliance Airport.
Under the Management Agreement, the Contractor is obligated to operate Fort Worth Alliance Airport
as a public airport while maintaining and repairing all buildings, structures, runways, taxiways, roads,
and any additions or installations and other property of the City located on Fort Worth Alliance Airport at
the Contractor's sole expense.
The Contractor is also responsible for the administration of construction, submittal of federal and state
grant requests, providing aircraft fueling services, all airport marketing, and making daily deposits of all
airport revenues in. an account established by the City.
During the first 5 years (1993 to 1998) of the.Agreement, the City received 0% of the first $500,000,
15% of any amount from $500,000 to $1.5 million, and 20.`7% of any amount over $1.5 million.
Beginning in 1998, the City began receiving 15% of any revenue up to $1.5 million and 20.7% over $1.5
million. To date, the City has received $768,542 under the Agreement.
City of Fort Worth, Texas
"agoir and Council Communication
DATE REFERENCE NUMBER I LOG NAME PAGE
2/19/02 C-1 8972 55EXTENSION 1 .2 of 2
SUBJECT AMENDMENT OF CITY SECRETARY CONTRACT NO. 20060, AGREEMENT WITH
ALLIANCE AIR MANAGEMENT, LTD. FOR THE MANAGEMENT, OPERATION, AND
MAINTENANCE OF THE FORT WORTH ALLIANCE AIRPORT AND EXTENSION OF
TERMS OF RELATED FORT WORTH ALLIANCE AIRPORT LEASES
The Lease Agreement stipulates that the Lessee (Alliance Air Services, Inc.) has the right to divide the
premises into separately platted portions in order to construct improvements. As those improvements
are constructed, the lease agreement states that a separate lease agreement will be executed for each
portion with a term coinciding with the issuance of the certificate of occupancy for the improvement. To
that end, a separate lease agreement has been executed for Parcels 2 and 5, and one for Parcel 3.
Now in an effort to establish longer term stability and to increase the City's share, the Contractor
requests a 10-year extension with one 10-year option to renew the Management Agreement as well as
the Lease Agreement and the separate Ground Leases for Parcels 2, 5, and 3.
In exchange for the extension, the City's share of the gross revenue will remain the same until
December 31, 2008, but beginning January 1, 2009 to December 31, 2013, the City will receive 20% of
all revenues. Then, beginning January 1, 2014 to December 31, 2023, the share will increase to 25%
of all revenues.
Under the proposed share agreement, the City will receive an additional $309,288 over the amount in
the current Management Agreement. If the Management Agreement ended by its term on December
31, 2013, assuming annual revenues increase by 5%, and annual expenses increase by 3%, the City
will reap an estimated $5,326,303 over the life of the Management Agreement. If the proposed
Management Agreement extension is approved, the City will reap an estimated $13,764,699 from the
beginning of the original agreement, an increase of$8,438,366.
Due to the proposed increase in revenue to the City and the benefit of proving longer term stability and
continuity for the management of the Fort Worth Alliance Airport, City staff recommends that the
proposed extension be approved.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Finance Department, Revenue Office will be responsible for the
collection and deposit of funds due to the City under all documents referenced herein.
MG:n
Submitted for City Manager's FUND ACCOUNT CENTER AMOUNT CITY SECRETARY
Office by: (to)
PE40 491022 0552003
Mike Groomer 6140
Originating Department Head: j
Lisa A.Pyles 5403 (from) APPROVED 02/19/02
Additional Information Contact:
Lisa A.Pyles 5403