HomeMy WebLinkAbout2024-143 AGRMT - Corrigan Loving Trust COMMERCIAL LEASE
DATED: October , 2024
BETWEEN: Richard W. Corrigan and Donna B. Corrigan, LANDLORD
Trustees of the Corrigan Loving Trust
dated October 7, 1992
285 Amos Rd.
Talent, OR 97540
AND: City of Ashland, an Oregon Municipality TENANT
20 E. Main St.
Ashland, OR 97520
Landlord leases to Tenant the following described property on the terms and
conditions stated below:
The entire property at 2245 Ashland Street,Ashland, Oregon, including two
parking lots.
I. OCCUPANCY
a) Original Term: The term of this Lease shall commence this date and continue
through October 18, 2029.
b) Possession: Tenant's right to possession and obligations under this Lease shall
commence on this date.
c) Renewal Option: If Tenant has not been in default throughout the term hereof,
Tenant shall have the right to renew this Lease for one term of two years as follows:
(1) The renewal term shall commence on the day following the date of
termination of the original term.
(2) The option may be exercised by written notice to Landlord given
not less than ninety (90) days prior to the last day of the expiring term. The giving of
such notice shall be sufficient to make the Lease binding for the renewal term without
further act of the parties.
(3) The terms and conditions of the Lease for the renewal term shall be identical with
the original term except for rent and renewal rights. Basic Rent shall be the rent owing at
the end of the expiring term, subject to the escalation provisions set forth below.
II. RENT
a) Basic Rent: Tenant shall pay to Landlord as rent the sum of Five Thousand
Five Hundred Forty ($5,540.00)per month. Rent shall be payable on the tenth (15th) day
of each month in advance at such place as may be designated by Landlord commencing
November 15, 2024.
b) Additional Rent: All taxes, insurance costs,maintenance costs, utility charges
which Tenant is required to pay by this Lease, and any other sum which Tenant is
required to pay to Landlord or third parties shall be additional rent.
c) Security Deposit: To secure Tenant's compliance with all terms of this Lease,
Tenant has paid Landlord the sum of Five Thousand Five Hundred Forty Dollars
($5,540.00) as a deposit. The deposit shall be a debt from Landlord to Tenant,refundable
within thirty (30) days following expiration of the Lease term or other termination not
caused by Tenant's default. Landlord shall have the right to offset against the deposit any
sums owing from Tenant to Landlord, including rent not paid when due, any damages
caused by Tenant's default, the cost of curing any default by Tenant should Landlord elect
to do so, and the cost of performing any repair or cleanup that is Tenant's responsibility
under this Lease. Offset against the deposit shall not be an exclusive remedy in any of
the above cases, but may be invoked by Landlord, at Landlord's option, in addition to any
other remedy provided by law or this Lease for Tenant's nonperformance. Landlord shall
give notice to Tenant each time an offset is claimed against the deposit, and unless the
Lease is terminated, Tenant shall within ten (10) days following such notice deposit with
Landlord a sum equal to the amount of the offset so that the total deposit amount,net of
offset, shall remain constant throughout the Lease term.
d) Escalation:
Effective October 15, 2025, and on the tenth(15a') day of each October thereafter,
including the renewal term, the basic rent shall increase by four percent(4%) over that in
effect during the preceding year.
III. USE OF THE PREMISES
a) Permitted Use: The premises shall be used for offices and for no other
purpose without the consent of Landlord.
b) Restrictions on Use: In connection with the use of the premises,Tenant shall:
(1) Conform to all applicable laws and regulations of any public authority and restrictive
covenants of record affecting the premises and the use, and shall correct at Tenant's own
expense any failure of compliance created through Tenant's fault or by reason of Tenant's
use or as otherwise required from Tenant by the terms of this lease.
(2) Refrain from any activity which would make it impossible to
insure the premises against casualty, would increase the insurance rate, or would prevent
Landlord from taking advantage of any ruling of the Oregon Insurance Rating Bureau or
its successor allowing Landlord to obtain reduced premium rates for long-term fire
insurance policies,unless Tenant pays the additional cost of the insurance.
(3) Refrain from any use which would be reasonably offensive to
other tenants or owners or users of neighboring premises or which would tend to create a
nuisance or damage the reputation of the premises.
(4) Refrain from loading the floors beyond the point considered
safe by a competent engineer or architect selected by Landlord.
(5) Refrain from making any marks on or attaching any sign,
insignia, antenna, aerial, or other device to the exterior or interior walls, windows, or roof
of the premises without the written consent of Landlord.
(6) Refrain from causing or permitting any hazardous substance,
as that term is defined by federal or state law from time to time, or other toxic substances
or controlled substances,to be generated, manufactured, refined, stored, disposed,
processed,produced, or released on the leased premises except in compliance with all
applicable federal, state and local laws and regulations.
TV. REPAIRS AND MAINTENANCE
a) Landlord's Obligations: The following shall be the responsibility of Landlord:
(1) Repairs of the roof and gutters, exterior walls (including painting),
bearing walls, structural members, and foundation.
(2) Repair of sidewalks, driveways, curbs, and parking areas.
(3) Repair and maintenance of water, sewage, gas, plumbing, and
electrical services up to the , with the exclusion of minor light fixtures and switches per
IV.b.1, of the leased premises.
(4) Repair or replacement of the heating and air conditioning system if
the cost thereof is$2,500.00 or more. In analyzing costs, each repair will be viewed in
isolation and not aggregated with other repairs.
(5) Before November 15,2024, Landlord shall have the landscape
professionally restored,without new plantings or removal of living trees,to a condition
reasonably acceptable to Tenant. By that date,Landlord shall also have the interior and
exterior of the building professionally cleaned,including the windows, floors, walls,
mirrors, dusting, and installation of air filters.
b)Tenant's Obligations: The following shall be the responsibility of Tenant:
(1) Repairs of interior walls, ceilings, doors, windows, and
related hardware, light fixtures, switches, and wiring and plumbing
from the point of entry to the premises.
(2) Any repairs necessitated by the negligence of Tenant,
Tenant's agents, employees, and invitees.
(3) All repairs and maintenance concerning the heating and air
conditioning system except as provided above.
(4) All other repairs and maintenance of the premises which
Landlord is not required to make.
(5) Maintenance of the subject premises in a clean and orderly
condition.
(6) All utility charges incurred during the term of this lease,
including but not limited to water, gas, electricity,trash removal
and any other services deemed necessary for the occupancy of the
premises.
c)Landlord's Interference with Tenant:Any repairs,replacements, alterations, or
other work performed on or around the leased premises by Landlord shall be done so as
to interfere as little as reasonably possible with use of the premises by Tenant. Tenant
shall have no right to an abatement of rent nor any claims against Landlord for any
inconvenience or disturbance resulting from Landlord's activities performed in
conformance with the requirement of this provision.
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d) Reimbursement for Repairs Assumed: If either party fails or refuses to make
repairs which are required by this Lease,the other party may make the repairs and charge
the actual costs of repairs to the first party. Such expenditures by Landlord shall be
reimbursed by Tenant on demand together with interest at the rate of Twelve percent
(12%) per annum from the date of expenditure by Landlord. Such expenditures by 3
Tenant may be deducted from rent and other payments subsequently becoming due or, at
Landlord's election, collected directly from Landlord. Except in an emergency creating
an immediate risk of personal injury or property damage,neither party may perform
repairs which are the obligation of the other party and charge the other party for the
resulting expenses unless at least thirty (30) days before work is commenced the
defaulting party is given notice, in writing, outlining with reasonable particularity the
repairs required and such party fails within that time to initiate such repairs in good faith.
e)Inspection of Premises: Landlord shall have the right to inspect the premises
upon 24 hours written or electronic notice or immediately in the event of an emergency to
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determine the necessity of repair. Whether or not such inspection is made,the duty of
Landlord to make repairs shall not mature until a reasonable time after Landlord has
received from Tenant notice in writing of the repairs that are required.
f) Cost Share: The parties shall equally share the cost of completing the flooring
on the main level,replacing the carpet on the upper level, and painting the interior. Based
on bids reasonably acceptable to both parties,Tenant shall arrange for the work and pay
for same.Tenant shall be credited for half the cost of each component, following delivery
of proof of payment, against the Basic Rent due for the month following. Tenant's
maximum credit will be $10,000.00.
V. ALTERATIONS
a) Alterations Prohibited: Tenant shall make no improvements or alterations on
the leased premises of any kind without first obtaining Landlord's written consent.
b) Ownership of Alterations: All improvements and alterations performed on the
leased premises by either Landlord or Tenant shall be the property of Landlord when
installed unless the applicable Landlord's consent specifically provides otherwise.
VI. INSURANCE
a) Insurance Required: Landlord shall keep the leased premises insured at
Tenant's expense against fire and other risks covered by a standard all-risk insurance
policy with an endorsement for extended coverage. All coverage shall show Landlord as
the insured and provide that coverage will not be cancelled nor diminished without
Landlords'written consent. Tenant shall bear the expense of any insurance insuring the
property of Tenant on the premises against such risks but shall not be required to insure.
b) Waiver of Subrogation: Neither party shall be liable to the other(or to the
other's successors or assigns)for any loss or damage caused by fire or any of the risks
enumerated in a standard all-risk fire insurance policy with an extended coverage
endorsement, and in the event
of insured loss neither party's insurance company shall have a subrogated claim against
the other.
VII. TAXES
a) Prope , Taxes: Tenant shall pay as due all taxes on Tenant's personal
property located on the leased premises. Tenant shall pay as due all real property taxes
and special assessments levied against the leased premises if taxes are assessed by the
County.
b) Special Assessments: If an assessment for a public improvement is made
against the leased premises, said party may elect to cause such assessment to be paid in
installments, in which case all of the installments payable with respect to the Lease term
shall be treated the same as real property taxes as set forth above.
c) Contest of Taxes: Tenant shall be permitted to contest the amount of any tax
or assessment so long as such contest is conducted in a manner which does not cause any
risk that Landlord's interest in the leased premises will be foreclosed for
nonpayment. Landlord shall cooperate in any reasonable manner with such contest by
Tenant. Tenant shall post a surety bond in the full sum of the taxes claimed no later than
the due date thereof.
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VIII. DAMAGE AND DESTRUCTION
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a) Partial Damage: If the leased premises are partly damaged and the following
subsection does not apply,the property shall be repaired by Landlord at Landlord's
expense if insurance proceeds are available. Repairs shall be accomplished with all
reasonable dispatch subject to interruptions and delays from labor disputes and matters
beyond the control of Landlord.
b) Destruction: If the leased premises are destroyed or damaged such that the
cost of repair exceeds the available insurance proceeds, either party may elect to
terminate the Lease as of the date of the damage or destruction by notice given to the
other in writing not more than forty-five (45) days following the date of damage. In such
event, all rights and obligations of the parties shall cease as of the date of termination,
and Tenant shall be entitled to the reimbursement of any prepaid amounts paid by Tenant
and attributable to the anticipated term. If neither party elects to terminate, Landlord
shall proceed to restore the leased premises to substantially the same form as prior to the
damage or destruction. Work shall be commenced as soon as reasonably possible and
thereafter shall proceed without interruption except for work stoppages on account of
labor disputes and matters not under control of Landlord.
c) Rent Abatement: Rent shall be abated during the repair of any damage to the
extent the premises are untenantable, except that there shall be no rent abatement where
the damage occurred as the result of the fault of Tenant.
d) Damage Late in Term: If damage or destruction referred to within Subsection(b)
would apply occurs within 90 days prior to the end of the then current Lease term,
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Landlord may elect to terminate the Lease by notice in writing to Tenant given within
thirty (30) days after the date of the damage.
IX. EMINENT DOMAIN
a) Partial Taking: If a portion of the leased premises is condemned, and
Subsection (b) does not apply,the Lease shall continue on the following terms: Landlord
shall proceed as soon as reasonably possible to make such repairs and alterations to the
premises as are necessary to restore the remaining premises to a condition as comparable
as reasonably practicable to that existing at the time of the condemnation.
b) Total Taking: If a condemning authority takes all of the leased premises or a
portion sufficient to render the remaining premises reasonably unsuitable for the use
which Tenant was then making of the premises,the Lease shall terminate as of the date
the title vests in the condemning authorities. Landlord shall receive all condemnation
proceeds.
c) Sale in Lieu of Condemnation: Sale of all or part of the leased premises to a
purchaser with the power of eminent domain in the face of a threat or probability of the
exercise of the power shall be treated for the purposes of this Section as a taking by
condemnation.
X. LIABILITY AND INDEMNITY
a) Liens:
(1) Except with respect to activities for which Landlord is
responsible, Tenant shall pay as due all claims for work done on, and for services
rendered or material furnished to, the leased premises and shall keep the premises free
from any liens. If Tenant fails to pay any such claims or to discharge any lien,Landlord
may do so and collect the cost as additional rent. Any amount so added shall bear interest
at the rate of Twelve percent(12%)per annum from the date expended by Landlord and
shall be payable on demand. Such action by Landlord shall not constitute a waiver of any
right or remedy which Landlord may have on account of Tenant's default.
(2) Tenant may withhold payment of any claim in connection with
a good-faith dispute over the obligation to pay, so long as Landlord's property interests
are not jeopardized. If a lien is filed as a result of nonpayment,Tenant shall, within ten
(10) days after knowledge of the filing, secure the discharge of the lien or deposit with
Landlord cash or sufficient corporate surety bond or other surety satisfactory to Landlord
in an amount sufficient to discharge the lien plus any costs, attorney fees, and other
charges that could accrue as a result of a foreclosure or sale under the lien.
b) Indemnification: Tenant shall indemnify and defend Landlord from any
claim, loss, or liability arising out of or related to any activity of Tenant on the leased
premises or any condition of the leased premises in the possession or under the control of
Tenant, unless such claim, loss, or liability is due to the negligence or willful misconduct
of Landlord or Landlords failure to comply with Landlord's obligations under this
Lease. Landlord shall have no liability to Tenant for any loss or damage caused by third
parties or by any condition of the premises unless such loss or damage is due to the
negligence or willful misconduct of Landlord, or Landlord's failure to comply with
Landlord's obligations under this Lease
c) Liability Insurance: Before going into possession of the premises, Tenant
shall procure, and thereafter during the term of the Lease shall continue to carry, the
following insurance at Tenant's cost: public liability and property damage insurance in a
responsible company with limits of not less than$1,000,000,00 for injury to one person,
$2,000,000.00 for injury to two or more persons in one occurrence, and $100,000.00 for
damage to property. Such insurance shall cover all risks arising directly or indirectly out
of Tenant's activities on or any condition of the leased premises whether or not related to
an occurrence caused or contributed to by Landlord's negligence, shall protect Tenant
against the claims of Landlord on account of the obligations assumed by Tenant under
this Lease; and shall protect Landlord and Tenant against claims of third
persons. Certificates evidencing such insurance,naming Landlord an additional insured
thereon, and bearing endorsements requiring ten (10) days' written notice to Landlord
prior to any change or cancellation shall be furnished to Landlord prior to Tenant's
occupancy of the property.
XI. ASSIGNMENTAND SUBLEASE
Tenant may sublease up to 40% of the building square footage.Any subleasing in
excess of 40%requires written consent of the Landlord, which shall not be unreasonably
withheld.
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XII. DEFAULT
The following shall be events of default:
a) Default in Rent: Failure of Tenant to pay any rent or other charge
within ten (10) days after notice to Tenant.
b) Default in Other Covenants: Failure of Tenant to comply with any term or
condition or fulfill any obligation of the Lease (other than the payment of rent or other
charges) within twenty (20) days after written notice by Landlord specifying the nature of
the default with
reasonable particularity. If the default is of such a nature that it cannot be completely
remedied within said period, this provision shall be complied with if Tenant begins
correction of the default within said period and thereafter proceeds with reasonable
diligence and in good faith to effect the remedy as soon as practicable.
XIII. REMEDIES ON DEFAULT
In addition to any other remedies herein, Landlord shall be entitled to a late
charge of 5% of any overdue payment commencing 15 days following its due date. Any
late charge shall be due as soon as it is incurred.
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Upon the termination of this Lease, at its expiration by lapse of time or
otherwise,the Tenant shall yield up immediate possession to the Landlord.
It is mutually agreed as a condition of this Lease, and the Tenant covenants,that if
there shall be a default as defined above,then and in each and every case, the term hereby
granted shall, at the election of the Landlord, immediately thereupon cease, terminate and
come to an end, without further formality and without prejudice to Landlord's right to
rents due or to become due; and the Landlord may recover and resume possession of the
demised premises by any legal means; and in such case,the Landlord shall have the right
to re-enter upon said premises and resume possession of same and without prejudice to
any remedies which might otherwise be available to Landlord.
It is understood and agreed that in the event of default of Tenant's obligations as
defined in this Agreement, so that Landlord resumes possession of the subject real
property and improvements thereon,the Tenant's obligations for monthly installment
payments shall not terminate; that each month's unpaid installment shall constitute a
separate cause of action for which the Landlord may litigate independently. Any action
or suit to recover possession of said real property and improvements shall not terminate
rent obligations due from Tenant.
The written notice of Landlord's intention to terminate this Lease hereinabove
provided for shall be deemed a re-entry under the law, as to all rights between Landlord
and Tenant herein, and upon any such resumption of possession by the Landlord in any
manner, Landlord may remove all persons and property from the demised
premises. Landlord may thereafter be entitled to hold the Tenant liable for expenses
incurred by the Landlord for necessary repairs to the demised premises, so far as
incumbent upon the Tenant to keep same in repair, or by reason of the breach of any of
the terms, conditions, or covenants of this Lease, and all expenses incurred in recovering
possession of the premises and in reletting same to mitigate Landlord's loss.
XIV. SURRENDER AT EXPIRATION
a) Condition of Premises: Upon expiration of the Lease term, or earlier termination
on
account of default, Tenant shall deliver all keys to Landlord and surrender the leased
premises in first-class condition and broom clean. Alterations constructed by Tenant with
permission from Landlord shall not be removed or restored to the original condition
unless the terms of permission for the alteration so require. Depreciation and wear from
ordinary use for the purpose for which Tenant is responsible shall not be charged against
Tenant. Excess use and damage shall be promptly remedied by Tenant,to be completed
by the latest practical date prior to surrender.
b) Fixtures;
(1) All fixtures placed upon the leased premises during the term,
other than Tenant's trade fixtures, shall, at Landlord's option,become the property of
Landlord. If Landlord so elects, Tenant shall remove any or all fixtures which would
otherwise remain the property of Landlord, and shall repair any physical damage
resulting from the removal. If Tenant fails to remove such fixtures, Landlord may do so
and charge the cost to Tenant with interest at the legal rate from the date of expenditure.
(2) Prior to expiration or termination of the Lease term Tenant
shall remove all furnishings, furniture, and trade fixtures which remain Tenant's
property. If Tenant fails to do so,this shall be an abandonment of the property.
c) Holdover:
(1) If Tenant does not vacate the leased premises at the time
required, Landlord shall have the option to treat Tenant as a tenant from month-to-month,
subject to all of the provisions of this Lease, except the provisions for term and renewal,
and at a rental rate equal to One Hundred Ten Percent(110%) of the rent last paid by
Tenant during the original term or renewal term, as the case may be. Failure of Tenant to
remove fixtures, furniture, furnishings, or trade fixtures which Tenant is required to
remove under this Lease, shall constitute a failure to vacate to which this paragraph shall
apply if the property not removed will substantially interfere with occupancy of the
premises by another tenant or with occupancy by Landlord for any purpose, including
preparation for a new tenant. I
(2) If a month-to-month tenancy results from a holdover by Tenant under this
Subsection,the tenancy shall be terminable at the end of any monthly rental period on
written notice from Landlord given not less than thirty (30) days prior to the termination
date which shall be specified in the
notice. Tenant waives any notice which would otherwise be
provided by law with respect to a month-to-month tenancy.
XV. MISCELLANEOUS
a) Nonwaiver: Waiver by either party of strict performance of any provision of
this Lease shall not be a waiver of or prejudice the party's right to require strict
performance of the same provision in the future, or of any other provision.
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b) Attorney Fees: If suit or action is instituted in connection with any
controversy arising out of this Lease,the prevailing party shall be entitled to recover, in
addition to costs, such sum as the Court may adjudge reasonable as attorney fees at trial
and on appeal. No party shall be entitled to such award of fees unless, prior to filing a
lawsuit, said party offered to participate in mediation with the other party.
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c) Notices: Any notice required or permitted under this Lease shall be deemed
given when actually delivered, or forty-eight(48) hours after deposited in the United
States mail as Certified Mail addressed to the address first given in this Lease, or to such
other address as may be specified from time to time by either of the parties in writing,
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d) Succession: Subject to the above-stated limitations on transfer of Tenant's
interest,this Lease shall be binding upon and inure to the benefit of the parties, their
respective successors or assigns, subject to the above restrictions on assignment.
THIS LEASE WAS PREPARED ON BEHALF OF LANDLORD.
LANDLORD
6 S
Ric rrz an, rustee nna B. Corrigan,Trustee
TENANT
City of Ashland
By:
Sabrina Cotta, City anager
orev1-(orl GoWman , /44,0_�, GM
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