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South Bend Redevelopment Commission Regular Meeting — Thursday, November 14, 2013 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (2) continued... • Section 10 of that lease agreement requires 30 day notice of lease termination. • This termination request meets the requirement set forth in section 10 of the current agreement. • The police substation space in Michigan Street Shops will be vacated by December 1, 2013. (3) Lease By and Between the South Bend Redevelopment Commission and Irish Cupcakes, Inc. d/b /a/ Yummy Cupcakes. Mr. Zeeb noted that Yummy Cupcakes franchise owner, Lawrence Katz has submitted a proposal to lease space located at 119 S. Michigan St. in the South Bend Central Development Area (SBCDA) with the following items. Synopsis of Proposed Lease: • Lease Term five (5) years, with the option of two - five year lease renewals; • Initial rent is $8.00 per sq. ft., totaling $4,800.00 for six months of year one (due to 180 day rent commencement clause in proposal) and $9,600 years 2 -5; • Common Area Maintenance and real estate tax will be billed at $5.53 per sq. ft. totaling $3,318.00 for six months of year one and $6,636.00 years 2 -5; • Tenant will take procession of space in "as is condition "; • Owner will proved three (3) parking permits for Leighton Parking garage at no cost to tenant and (3) parking permits at a reduced rate of $30.00 each per month. The proposed lease will produce $73,062.00 during the 5 year lease agreement. The Commission will incur $14,400.00 for parking over the 5 year lease. If executed, the lease will net $58,662.00 during the 5 year lease period. The proposed lease will have private investment in the Michigan Street shop space of $24,000.00 (estimated psf. @ 1200 sf.) The lease with Yummy Cupcakes will be paying the taxes and the CAM expenses, which the SBPD lease was not paying. Community Investment is in support of this national retail business locating in downtown South Bend and believes the business is a good fit for the Michigan Street shops. Upon approval of this agreement, Redevelopment Retail will continue to maintain 100% occupancy. Staff recommends approval of Lease with Yummy Cupcakes /Lawrence Katz /Irish Cupcakes. Mr. Katz noted that he is very excited to open up a Yummy Cupcakes store, provide employment, and income for downtown South Bend. 5