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HomeMy WebLinkAbout2023-09 EDARCommissioner Jerzak introduced the following resolution and moved its adoption: EDA RESOLUTION NO. 2023-09 RESOLUTION APPROVING THE TERMINATION OF THE LEASE AGREEMENT AND RELOCATION ASSISTANCE AGREEMENT WITH SHENG ZHENG, WANG LIN, LIN, INC., OPERATING UNDER THE TRADE NAME "OCEAN BUFFET" AND ALATUS BROOKLYN CENTER WHEREAS, the Economic Development Authority of Brooklyn Center, Minnesota (the "EDA") is the owner of certain premises known as Store #5810 consisting of 8,100 rental square feet located at 5810 Shingle Creek Parkway, Brooklyn Center, Minnesota (the "Premises"); and WHEREAS, the EDA leases the Premises to Sheng Zheng, individually, Wang Lin, individually, and Lin, Inc., operating under the trade name "Ocean Buffet" (collectively, the "Tenant"); and WHEREAS, the EDA and the Tenant's predecessors in interest entered into a Lease Agreement for the Premises on March 10, 2011 (the "Lease"), the Lease was amended in March cf 2016 by the EDA and the Tenant; WHEREAS, the EDA intends to sell property that includes but may not be limited to the Premises to Alatus Brooklyn Center, a Minnesota limited liability company (the "Purchaser") for the purpose of redevelopment, including the demolition of the Premises; and WHEREAS, the Tenant is eligible to receive relocation services and assistance from the Authority provided under the Minnesota Uniform Relocation Act, Minnesota Statutes, Section 117.52 if it is required to relocate due to the redevelopment of the Premises; and WHEREAS, the EDA contracted with a relocation consultant to provide relocation services to the Tenant; and WHEREAS, the EDA's consultant has provided relocation services to the Tenant and advised the Tenant of its rights under the Minnesota Uniform Relocation Act; and WHEREAS, the EDA and the Tenant reached an agreement to an amendment to the Lease Agreement to add a Relocation Agreement in January 2021, and Tenant was paid a one-time non-refundable Relocation Payment in the amount of $40,000; and WHEREAS, the Tenant also agreed to terminate the Lease early and the Purchaser agreed to pay the Tenant an early termination payment of $300,000 if the sale of the Premises to the Purchaser occurs; and WHEREAS, during the remaining term of the Lease, the EDA agreed that Tenant did not need to pay any Minimum Annual Rent under Section 4.01(a) of the Lease, but remained obligated to pay Additional Rent and Percentage Rent; and WHEREAS, the parties agreed that in the event that the sale of the Premises did not occur by the lease termination date, the Tenant had the right to notify the EDA, by email, of its exercise of the Option Term under the terms of the Lease, which would extend their lease an additional five years, but no further relocation payments would be due to the Tenant because the Tenant's continued occupancy of the Premises after it had received the relocation payment is an occupancy that begins after the date of the property's acquisition for the project under 49 C.F.R. 24.2(a)(9)(ii)(B); and WHEREAS, the parties agreed to amend the Lease Agreement and Relocation Assistance Agreement in July 2022 to extend the lease termination date to November 30, 2022; and WHEREAS, the parties agreed to amend the Lease Agreement and Relocation Assistance Agreement in September 2022 to extend the lease termination date to February 28, 2023; and WHEREAS, the parties agreed to amend the Lease Agreement and Relocation Assistance Agreement in February 2023 to extend the lease termination date to September 30, 2023; and WHEREAS, the closing of the sale of the Premises has not occurred and will not occur prior to the existing deadline of September 30, 2023, as set forth in the most recent amendment to the Lease Agreement and Relocation Assistance Agreement; and WHEREAS, the closing of the sale of the Premises is not anticipated to take place for a number of months, and therefore, in the best interests of the parties, the parties have negotiated and desire to terminate the Lease, and any and all amendments thereto, effective September 30, 2023, while allowing the Tenant to surrender the Premises no later than October 15, 2023. NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority of Brooklyn Center, Minnesota (the "Board"), as follows: 1. The EDA hereby approves the Termination of Lease Agreement and Relocation Assistance Agreement in substantially the form presented to the Board, together with any related documents necessary in connection therewith (collectively, the "Agreement"), subject to modifications that do not alter the substance of the Agreement and that are approved by the President and Executive Director, provided that execution of the Agreement by those officials shall be conclusive evidence of their approval. 2. The approval hereby given to the Agreement includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the EDA and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the EDA. The execution of any instrument by the appropriate officers of the EDA herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of theofficers, any of the documents authorized by this Resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by suchother officer or officers of the Board as, in the opinion of the City Attorney, may act in their behalf. 3. Upon execution and delivery of the Agreement, the officers and employees of the EDA are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the Authority to implement the Agreement. 4. The Board hereby determines that the execution and performance of the Agreement will help realize the public purposes of the Economic Development Authority Act. September 25, 2023 Date ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by: Graves President Commissionerand upon vote being taken thereon, the following voted in favor thereof: Butler, Graves, Jerzak, Kragness. and the following voted against the same: None. whereupon said resolution was declared duly passed and adopted.