From
Megan Mahan
Title
Resolution authorizing a Fifteen-Year Tenant Lease with Option to Renew for two Ten-Year Terms with MLC Dallas Stadium Co, LLC (or related assignee), for the Conversion Construction and Operation of a Cricket Stadium in the Entertainment District for a base rent of $20,000 monthly for 80 months, and $10,000 monthly for the Remainder of the Lease and percentage rent of 5% of Gross Revenues; Economic Development Agreement for a Cash Grant of $1,300,000 for Construction, a $200,000 Maintenance Reserve, waiver of all construction building permit fees and impact fees, and a 100% rebate of the 1% General Fund sales tax for construction materials; Consent to Easement and Use Agreement between MLC Dallas Stadium Co, LLC (or related assignee) and Anschutz Texas, L.P. for related construction on ancillary land
Presenter
Steve Dye, Deputy City Manager
Recommended Action
Approve
Analysis
A fifteen- year Lease Agreement would be executed with MLC Dallas Stadium Co, or related entity, as the tenant. Tenant will be paying for the conversion of Airhogs Baseball Stadium into a Major League Cricket Stadium, with the City providing a portion of the construction costs for suite, concession, retail upgrades and other improvements.
A large portion of the leased land is subleased from Grand Prairie Sports Development Corporation, so this lease will require their consent. The other smaller portion of the leased land is owned by the City. The building is owned by the City.
Rent would be calculated as follows:
Base Rent: $10,000 monthly for the duration of the term and all respective extensions
Percentage Rent: 5% Gross Revenues for the duration of the term and all respective extensions.
Construction Rent: $10,000 monthly for 80 months
Licensing Revenue Share: 2% of Dallas Licensing Revenue from global sales for 12 years; 2.5% of Dallas Licensing Revenue from US sales for 10 years (years 13-23)
The Tenant would pay all operating costs during the term of the Lease, such as equipment maintenance, insurance, and utilities, and the Tenant would maintain the building structure. The Tenant may not sublet the space and has no right to assign the lease without City approval. The Lease could be renewed for two additional ten-year terms.
The 380 Agreement authorizes any grants required under the Lease to be paid as an economic development incentive, which includes Cash Grant of $1,300,000 for Construction and placing $200,000 into an account as a Maintenance Reserve, which Tenant will then be required to keep this reserve at certain levels from Tenant funds during the term of the Lease. There will also be a waiver of any building permit fees and impact fees, as well as a 100% rebate of the 1% General Fund sales tax for construction materials.
Tenant will also be constructing additional improvements on the land next to the stadium that is currently leased to Anschutz Texas, L.P. The City consents to the terms of this agreement.
Financial Consideration
380 grants will be paid from FY 2020/2021 Baseball Operations Fund (317992) and a new revenue account will be established as a location for the rent payments.
Body
A RESOLUTION OF THE CITY OF GRAND PRAIRIE, TEXAS, TO ENTER INTO A CHAPTER 380 ECONOMIC DEVELOPMENT AGREEMENT WITH MLC DALLAS STADIUM CO llc (or related assignee) ("developer") FOR THE CONSTRUCTION AND operation OF A CRICKET STADIUM IN THE ENTERTAINMENT DISTRICT
WHEREAS, the City of Grand Prairie wishes to enter into this agreement for the Developer to construct and operate a major league cricket stadium and it is in the public interest to do so; and
Whereas, a construction sales tax rebate for 100% of 1% of General Fund sales tax will induce Development to situs construction sales tax to Grand Prairie, and a payment of any grant funds required under the Lease will provide help provide incentive for a high quality project within Grand Prairie; and
Whereas, Developer also desires that the project receive a credit for associated project plans review, building permit and water tap and meter fees; and
WHEREAS, the City Council has determined that it is in the public interest to enter into a Chapter 380 Program Agreement for Economic Development Incentives.
NOW THEREFORE, BE IT RESOLVED, BY THE CITY COUNCIL OF THE CITY OF GRAND PRAIRIE, TEXAS:
Section 1. THAT the granting of this Chapter 380 Economic Development Agreement and Lease Agreement is approved and the City Manager is hereby authorized to execute contracts to effectuate this approval.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAND PRAIRIE, TEXAS, ON THIS THE 3rd DAY OF NOVEMBER, 2020.