Report to Mayor and City Council
Tuesday, September 19, 2023
Consent
SUBJECT:
Title
CONSIDERATION OF APPROVAL OF CONSENT TO TRANSFER OF DEVELOPER'S INTEREST IN DEVELOPMENT AGREEMENT NO. 22-19 FOR A DIGITAL OUTDOOR ADVERTISING SIGN LOCATED AT 2201 E. 223RD STREET, APN 7315-040-013, TO WECO RE HOLDINGS, LLC AND TRANSFER OF DEVELOPER'S INTEREST IN THE SUBJECT PROPERTY (CITY COUNCIL)
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I. SUMMARY
In 2021, WIN Chevrolet Properties, LLC (as "Developer"), entered into Development Agreement No. 22-19 ("Exhibit No. 1; the "Sign DA") with the City for removal of two then-existing on-premises digital pylon signs and installation of one new double-sided outdoor digital advertising sign ("Billboard") measuring approximately 64 feet high from ground level at the dealership.
The 30-year Development Agreement requires the Developer to pay the City an annual fee of $40,000 (adjusted every three years by 6%). The Billboard is now operational, and the first payment was recently made by the Developer. The payment was late and therefore included $6,000 in late penalties for a total payment of $46,000 received by the City.
The Developer now seeks to assign its interest in the Development Agreement to WECO RE Holdings, LLC, as the Developer intends to sell the 405 Freeway Site to WECO RE Holdings, LLC. These proposed transfers relate to the sale of the two existing automobile dealerships on the site (Chevrolet and Hyundai) from WIN Chevrolet, Inc. to Carson Chevrolet, LLC for the Chevrolet dealership, and WECO Motors, LLC for the Hyundai dealership, respectively. Developer is currently leasing the respective portions of the subject property (referred to in the Sign DA as the "405 Freeway Site") to Carson Chevrolet, LLC and WECO Motors, LLC to facilitate their operation of the dealerships; the lease to Carson Chevrolet includes the Billboard, and the lease to WECO Motors includes the right to use 50% of the Billboard for operation of the Hyundai dealership.
The proposed "C...
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